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GuideStar Webinar (01/09/14) - Overcoming Your Less Than Perfect Board
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GuideStar Webinar (01/09/14) - Overcoming Your Less Than Perfect Board

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What we hear most from nonprofit fundraising consultants is the need for our clients to improve their boards – to keep them engaged and focused on fundraising. …

What we hear most from nonprofit fundraising consultants is the need for our clients to improve their boards – to keep them engaged and focused on fundraising.

If you are serious about improving your board in this new year, your leadership must create a strategic approach and be flexible in changing old habits. You should also consider bringing in an outside consultant to assess and make recommendations. In our combined 50 years of working shoulder-to-shoulder with nonprofits as they improve their board structures and processes, we have learned how to build stronger, more engaged boards that better support the nonprofits they serve.

While fixing your board’s biggest problems is not going to happen overnight, you will walk away from this webinar with ideas for how to kick off the new year with an approach for how to begin to make the adjustments necessary to give you strong board leadership in support of your mission.

Presenters: Stephen K. Orr, Managing Partner, Orr Associates Inc. (OAI); Kelly Dunphy, Vice President, Fundraising and Development, Orr Associates, Inc. (OAI); and Jenny Taylor, Marketing Specialist, GuideStar USA (moderator)

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  • 1. Overcoming Your Less Than Perfect Board January 9, 2014 Steve Orr, Managing Partner, OAI Kelly Dunphy, Vice President, Fundraising and Development, OAI Copyright © 2014 Orr Associates, Inc. All Rights Reserved.
  • 2. Introductions Steve Orr Managing Partner and Co-Founder, Orr Associates, Inc. (OAI) Founder and Executive Director, Youth, I.N.C. Kelly Dunphy Vice President, Fundraising and Development, Orr Associates, Inc. (OAI) w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 2
  • 3. Current Situation* • 75% of executive directors call board member engagement insufficient • 17% of executive directors reported that their boards have no involvement in fundraising at all • Only 48% of development directors at high-performing organizations reported having “a lot of influence” on board member participation in fundraising • 25% of organizations have no board fundraising committee * From Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising., Compass Point. http://www.compasspoint.org/underdeveloped w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 3
  • 4. Agenda • Elements of an Excellent Board • Common Board Issues and How to Overcome Them • Five Changes to Make to Your Board Now • Q&A w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 4
  • 5. Agenda • Elements of an Excellent Board • Common Board Issues and How to Overcome Them • Five Changes to Make to Your Board Now! • Q&A w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 5
  • 6. Elements of an Excellent Board Active Nominating or Governance Committee Job Description Effective Chair Performance Assessments Diversity Commitment 100% Participation in Fundraising w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 6
  • 7. Elements of an Excellent Board: Active Nominating or Governance Committee • The Nominating or Governance Committee should work consistently throughout the year to: – Identify, cultivate, recruit, and orient new members – Identify board leadership through a well-considered succession plan w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 7
  • 8. Elements of an Excellent Board: Job Description • Your organization’s board member job description should include expectations in all or most of the following categories: − Advocacy for the organization and its mission − Service/attendance − Fundraising activity/financial support − Governance − Knowledge of the organization − Access to information and confidentiality − Accountability w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 8
  • 9. Elements of an Excellent Board: Effective Chair • The Board Chair should work effectively with: – The board, both as individuals and as a group, during formal meetings – The CEO and other members of the management team – External stakeholders • Key Skills/Qualities include: – Builds and maintains strong relationships – Committed and proactive – Supports the vision and helps set strategies – Problem-solver – Has and uses connections to advance the organization w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 9
  • 10. Elements of an Excellent Board: Performance Assessments • Each year, the Governance Committee should: – Evaluate the board’s performance – Evaluate the performance of individual board members • A board self-assessment: – Gets input from all board members on how the board is performing against best practice standards – Measures performance against the board job description • BoardSource recommends that boards conduct board selfassessments and individual member assessments in alternating years w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 10
  • 11. Elements of an Excellent Board: Diversity Sectors Skills Demographics Other Factors Defense Legal Age Nonprofit Board Experience High Tech Finance & Accounting Gender Personal Wealth Government Investment Race “Plays well with others” Developers Human Resources Residence Corporate or foundation ties Legal Government Relations Education Marketing Health Care IT Banking Fundraising Ties to other organizations Retail Nonprofit w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 11
  • 12. Elements of an Excellent Board: Commitment • Your organization should be one of the top three philanthropic causes for each of your board members • Consistent meeting attendance • Committee participation • Event attendance • Willing to make hard decisions and address complex issues in order to advance the organization w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 12
  • 13. Elements of an Excellent Board: 100% Participation in Fundraising • Give generously • Be an advocate • Participate in fundraising w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 13
  • 14. Elements of an Excellent Board: 100% Participation in Fundraising • Give generously – Set give/get expectations – Provide board members with an annual commitment form that covers annual giving, events, and any other fundraising activities for which you solicit your board members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 14
  • 15. Elements of an Excellent Board: 100% Participation in Fundraising • Be an advocate – Tell your own personal story related to the organization • How did you get involved? • Why do you stay committed? – Know the organization’s case for support • What are the fact and figures? • How is philanthropic support used by the organization? • How can people give? – Have an “elevator speech” • Compose your own 30 second summary to be used when asked about the organization w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 15
  • 16. Elements of an Excellent Board: 100% Participation in Fundraising • Participate in fundraising – Identification – Cultivation – Solicitation – Stewardship w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 16
  • 17. Elements of an Excellent Board: 100% Participation in Fundraising Identification Current supporters, personal networks, screening, rating, research Stewardship Thanking, recognizing, communicating, involving Cultivation Building the relationship through communications, events, personal visits Solicitation Asking the right person, at the right time, by the right asker, for the right amount w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 17
  • 18. Agenda • Elements of an Excellent Board • Common Board Issues and How to Overcome Them • Five Changes to Make to Your Board Now! • Q&A w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 18
  • 19. Common Board Issues and How to Overcome Them 1. A founder's board 2. A board in need of transition 3. A board recruited without performance expectations or a job description 4. An unengaged board – except for a few members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 19
  • 20. Common Board Issues and How to Overcome Them 1. A founder's board 2. A board in need of transition 3. A board recruited without performance expectations or a job description 4. An unengaged board – except for a few members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 20
  • 21. A Founder's Board • Case Study: Youth, I.N.C. – 20-year old organization – Founder is still Executive Director – Potential issues: • Used personal network to recruit board – lack of turnover • Failure to adapt to changing needs/directions – How they made it work: • Board recruitment is a constant priority • Board members are moved off the board due to non-performance • Created a separate “Sustaining Board” to keep “non-performers” engaged • Involved board members in strategic planning process w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 21
  • 22. Common Board Issues and How to Overcome Them 1. A founder's board 2. A board in need of transition 3. A board recruited without performance expectations or a job description 4. An unengaged board – except for a few members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 22
  • 23. A Board in Need of Transition • Case Study: NYC-based youth social services organization – 30-year old organization – Issues: • Board membership included several non-performers • No established give/get amount • Gap in industries and skill sets, particularly in finance, which is a key industry in NYC from which to target board members • Same donors year after year – needed access to new networks of potential donors w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 23
  • 24. A Board in Need of Transition • Case Study: NYC-based youth social services organization – How they improved: • Recruited a special committee from existing board members, with an objective to identify and recruit new board members from the finance, media, and real estate industries • Established a minimum give/get of $25,000 for new board members • Adopted a new board job description • Board Chair and CEO were highly engaged in the project and acknowledged that the process could take at least a year • Recruited 9 new board members in 12 months, all committed to the new give/get policy and job description • The project injected much-needed energy into the board overall, and helped improve existing board member participation as well w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 24
  • 25. Common Board Issues and How to Overcome Them 1. A founder's board 2. A board in need of transition 3. A board recruited without performance expectations or a job description 4. An unengaged board – except for a few members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 25
  • 26. A Board Recruited without a Job Description • Potential issues: – No giving and fundraising requirement – No ability to measure board members against responsibilities – Greater likelihood of non-performing board members since expectations were not provided in writing during the recruitment process or once onboard w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 26
  • 27. A Board Recruited without a Job Description • Recommendations: – Work with the Governance or Nominating Committee to craft and adopt a job description using industry best practices as well as any customization for your organization – Have board members sign an annual “contract”, committing to the time and financial/fundraising expectations – Conduct annual assessments of board members using the expectations to which they agreed – Have honest conversations with any members who consistently don’t meet their commitments w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 27
  • 28. Common Board Issues and How to Overcome Them 1. A founder's board 2. A board in need of transition 3. A board recruited without performance expectations or a job description 4. An unengaged board – except for a few single members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 28
  • 29. An Unengaged Board • Potential issues: – A few members, by being most engaged with their time and financial capacity, control the agenda and the strategy for the organization – Risk losing the voices of members from different industries, with different skill sets, etc. • Recommendations: – Consider term limits if you don’t already have them – Conduct a board assessment of both the board as a whole and individual members • Use the results to make changes • Have honest conversations with disengaged members – Launch a robust board recruitment effort w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 29
  • 30. Agenda • Elements of an Excellent Board • Common Board Issues and How to Overcome Them • Six Changes to Make to Your Board Now! • Q&A w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 30
  • 31. Six Changes to Make to Your Board Now! 1. Create a board job description and require each board member to sign it annually or at the beginning of each term w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 31
  • 32. Six Changes to Make to Your Board Now! 1. Create a board job description and require each board member to sign it annually or at the beginning of each term 2. Retire non-performing board members w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 32
  • 33. Six Changes to Make to Your Board Now! 1. Create a board job description and require each board member to sign it annually or at the beginning of each term 2. Retire non-performing board members 3. Require 100% of board members to participate in fundraising w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 33
  • 34. Six Changes to Make to Your Board Now! 1. Create a board job description and require each board member to sign it annually or at the beginning of each term 2. Retire non-performing board members 3. Require 100% of board members to participate in fundraising 4. Ensure your CEO/Executive Director is spending at least 30% of his/her time with the board w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 34
  • 35. CEO Working with the Board • Board responsibilities of the CEO: – Train your board on how to fundraise – Provide administrative support to your board (e.g., marketing materials, supporting documents, donation processing, etc.) – Throughout the year, meet with each board member to ensure their needs and goals are being met w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 35
  • 36. Six Changes to Make to Your Board Now! 1. Create a board job description and get each board member to sign it now 2. Remove weak board members by placing them on committees 3. Get your board engaged in fundraising ASAP 4. Ensure your CEO/Executive Director is spending at least 30% of his/her time with the board 5. Identify your board needs and begin to recruit new board members to fill the gaps w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 36
  • 37. Board Recruitment is a Year-Long Function Identify needs for the next several years using a profile of your current board Approve the slate - inform new and renewed board members Orient new board members Determine renewals and retirements and have conversations with both; Identify candidates who meet identified needs Interview candidates using a job description - determine a “slate” to be presented to the full board; cultivation could take several steps w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 37
  • 38. Six Changes to Make to Your Board Now! 1. Create a board job description and get each board member to sign it now 2. Remove weak board members by placing them on committees 3. Get your board engaged in fundraising ASAP 4. Ensure your CEO/Executive Director is spending at least 30% of his/her time with the board 5. Identify your board needs and begin to recruit new board members to fill the gaps 6. Consider working with outside counsel for an objective voice to help steer the board toward needed transition w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 38
  • 39. Six Changes to Make to Your Board Now! 1. Create a board job description and get each board member to sign it now 2. Remove weak board members by placing them on committees 3. 4. Remember: Changes to Get your board engaged dofundraising ASAP your board in not happen Ensure your overnight – could take CEO/Executive Director is spending at least months, even years 30% of his/her time with the board 5. Identify your board needs and begin to recruit new board members to fill the gaps 6. Consider working with outside counsel for an objective voice to help steer the board toward needed transition w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 39
  • 40. Agenda • Elements of an Excellent Board • Top Board Issues and How to Overcome Them • Six Changes to Make to Your Board Now! • Q&A w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 40
  • 41. Q&A Thank you! Steve Orr sorr@oai-usa.com (202) 719-8080 Kelly Dunphy kdunphy@oai-usa.com (212) 424-1933 w ww.oai-usa.com Copyright © 2014 Orr Associates, Inc. All Rights Reserved. 41