Board Member Workshop
February 6, 2014
Haas School of Business
UC Berkeley
Welcome

2
Agenda
• 3:00 – 3:45

Welcome
• Dynamic Board Lessons

• 3:45 – 4:00

LinkedIn For Good
• Nonprofit Resources

• 4:00 – 5:...
Boards and Directors have Legal Duties of
Care, Loyalty and Obedience
Hold public benefit corporation ―in trust‖ for the c...
Types of Boards
 Organizing Board
– small, homogeneous, informal
– committed to purpose
– Very hands on to support start ...
Creating a Dynamic Board
Environment

• Monitor external and
internal environment to
prioritize areas for
Board attention
...
9 Responsibilities of Nonprofit Boards
• Shape, clarify
mission and
vision
• Engage actively
in strategic
decision making
...
Importance Ratings Vary Greatly by Organization
Q: Over the next one to two years, how important is it for your Board to f...
The Governance Gap
• 97% said that a high-performing board was important to a high-performing
nonprofit...
— However, only...
Board Performance GPA
Survey response to ―give your board a letter grade‖ on each dimension
Understanding mission

Financi...
5 Enablers are Key to Closing Execution Gap
• Effective board leadership must drive for a true
partnership at board and co...
Self Assessment Is Critical

Select, evaluate
and develop CEO

1

2

3

4

Poor

Average

Good

Distinctive

Succession pl...
Relative Priority (ratio vs average)

Dynamic Boards Set Priorities Based on
Need and Performance
1.4

Change

Maintain

E...
Summary Take-Aways
• Roles Matter: There are 9 clearly defined responsibilities of a nonprofit
board, with a gold standard...
A Good Board is a
Victory, Not a Gift
Cyril Houle

15
Breakout Group Coaching
•
•
•
•
•

Governance/Board Development
Marketing: Telling Your Story/Branding
Strategy
Fundraisin...
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Berkeley Board Fellows - Board Member Training 2-6-2014

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  • Welcome to the Board Fellows Program Kick-off I have been communicating with most of you, reading applications and really excited to see you all here together today.We are delighted to see students, mentors, nonprofit staff and board members represented today
  • The purpose of today isProvide the opportunity for fellows and mentors to meet one another and to plan for the year aheadProvide a chance for all participants to meetExplain program expectations, roles and responsibilitiesProvide an introduction to best practices in board governanceGive you a chance to hear from past participants and ask questions Introduce and thank Nora, Evin and Jean
  • The Agenda for today.
  • This page should be highlighted as they need to have an understanding of the benefits and requirements are of a tax exempt organization
  • Berkeley Board Fellows - Board Member Training 2-6-2014

    1. 1. Board Member Workshop February 6, 2014 Haas School of Business UC Berkeley
    2. 2. Welcome 2
    3. 3. Agenda • 3:00 – 3:45 Welcome • Dynamic Board Lessons • 3:45 – 4:00 LinkedIn For Good • Nonprofit Resources • 4:00 – 5:00 Topic-Specific Group Coaching • Governance, Strategy, Marketing, Fundraising, Board Recruitment 3
    4. 4. Boards and Directors have Legal Duties of Care, Loyalty and Obedience Hold public benefit corporation ―in trust‖ for the community Duty of care Duty of loyalty Duty of obedience • An obligation to act in good faith – with best interests of nonprofit in mind – with such care of a reasonably prudent person • An obligation to keep confidences of nonprofit and avoid actions that benefit self at expense of nonprofit • Required directors to comply with applicable laws, adhere to bylaws and remain guardians of the mission • Be informed e.g. – Attend meetings regularly – Seek and review necessary information • Exercise independent judgment – Ask questions – avoid simply going along with other directors – Rely only on judgment of dependable sources • Avoid self-dealing transactions • Where directors’ firm provides services or products to nonprofit, make conflict known to board, recuse self from discussions/votes • Understand mission and bylaws • Ensure regulatory filings completed • Require operation audit and policy review 4
    5. 5. Types of Boards  Organizing Board – small, homogeneous, informal – committed to purpose – Very hands on to support start up  Governing Board – larger and more diverse board – committees become important – shared authority between board and staff: board chair and executive director are principal leaders – transition to governing board takes at least 3 years and a lot of staff time  Institutional Board – very large (35-60 or more) – prestigious -- includes large donors or those with access to funders – accepts significant responsibility for fundraising – often delegates some governance to executive committee 5
    6. 6. Creating a Dynamic Board Environment • Monitor external and internal environment to prioritize areas for Board attention • Ensure quality performance across 3 primary Board roles • Develop a set of enabling Monitor and improve performance practices around Board composition, size structure, processes, and staff relationships Enablers 6
    7. 7. 9 Responsibilities of Nonprofit Boards • Shape, clarify mission and vision • Engage actively in strategic decision making and policy decisions Monitor and improve performance • Select, evaluate and develop CEO • Ensure adequate financial resources • Lend expertise; provide access to people • Protect/enhance reputation of organization • Oversee financial management, ensure appropriate risk management • Monitor performance, ensure accountability • Improve board performance 7
    8. 8. Importance Ratings Vary Greatly by Organization Q: Over the next one to two years, how important is it for your Board to focus on: 1. Clarifying the organization’s mission or vision 1 2 3 2. Resolving key strategic or policy issues 1 2 3 1 2 3 4. Developing financial resources to support strategy 1 2 3 5. Providing expertise or access to support organizational priorities 1 2 3 6. Building the reputation of the organization with key stakeholders 1 2 3 7. Overseeing financies and ensuring adequate risk management Shape Mission and Strategic Direction 1 2 3 8. Assessing performance against mission and key program priorities 1 2 3 1 2 Medium 3. Developing CEO capabilities Ensure Leadership and Resources Monitor and Improve Performance 9. Improving Board performance Low 3 High Rated Importance Group Average Group Response Range 8
    9. 9. The Governance Gap • 97% said that a high-performing board was important to a high-performing nonprofit... — However, only 19% said they were tapping their boards’ full potential • 94% felt that their boards provide the appropriate level of strategic guidance… — However, only 46% thought that their directors would be able to summarize both the mission and the vision of their organizations • 77% of respondents indicated a desire to improve board fundraising, but… — Just 21% set individual board member fundraising goals — Just 38% provided fundraising training — Moreover, a mere 16% reported having individual board members receive formal feedback on their performance at a regular interval • Source: McKinsey survey of social services organizations 9
    10. 10. Board Performance GPA Survey response to ―give your board a letter grade‖ on each dimension Understanding mission Financial oversight Legal/ethical oversight Supporting CEO Knowledge of programs Director view Monitoring performance CEO view Strategic planning Community relations Increasing diversity Fundraising 0 1 2 3 Source: Boardsource Nonprofit Governance Index 2010 4 10
    11. 11. 5 Enablers are Key to Closing Execution Gap • Effective board leadership must drive for a true partnership at board and committee level • A trust-based relationship with CEO as an underlying foundation • Sweating the details on process is critical to board function and engagement • Composition requires needs-based management and a graceful transition mindset • Size and structure are a balancing act but must ensure coverage of 9 responsibilities 11
    12. 12. Self Assessment Is Critical Select, evaluate and develop CEO 1 2 3 4 Poor Average Good Distinctive Succession planning Board has no clear succession plan Board has informal discussion with CEO on succession and on identifying candidates before need for a CEO transition arises Board has explicit view on succession and works with CEO to identify internal candidates with leadership potential Board has explicit view on succession and actively works with the CEO to identify internal candidates and provide development opportunities for the top 3-5 candidates to “round out” their skills Evaluation and development process Evaluations are subjective and occur on ad-hoc basis; most board members are unaware of process or feedback messages Evaluations performed annually against preagreed criteria; board members have opportunity to provide input to process Evaluations performed formally and annually against pre-negotiated goals; written feedback messages are reinforced through CEO compensation Evaluations performed at annually against predefined gooals; evaluation includes 360-degree feedback and includes a self-assessment by the CEO. Written feedback includes skill development plan. CEO compensation decision reinforces view of performance 12 Comments
    13. 13. Relative Priority (ratio vs average) Dynamic Boards Set Priorities Based on Need and Performance 1.4 Change Maintain Ensure Resources 1.3 1.2 Monitor org performance Enhance reputation 1.1 Shape M/V 1.0 0.9 Improve Board Performance Shape strategy Provide expertise and access 0.8 0.7 Oversee financial performance Develop CEO 0.6 Quick fix only 0.8 0.9 1.0 Reduce effort 1.1 1.2 Relative Performance (ratio vs average response) 13
    14. 14. Summary Take-Aways • Roles Matter: There are 9 clearly defined responsibilities of a nonprofit board, with a gold standard of performance for each. Increasing emphasis on: • Multi-year planning • Performance measurement and accountability • Risk management • Sweat the Enablers: Good governance is execution • Pay attention to the enablers of execution, including the small stuff • Board Chair as CGO • Understand and address the ―human‖ aspects of director interests and styles • Pick Your Battles: There are lots of ways boards, as entities and directors as individuals, can help. Pick your spots carefully to allot valuable time where needed most • Look in the Mirror: Invest significant time in board evaluation and continuous 14 improvement
    15. 15. A Good Board is a Victory, Not a Gift Cyril Houle 15
    16. 16. Breakout Group Coaching • • • • • Governance/Board Development Marketing: Telling Your Story/Branding Strategy Fundraising Board Recruitment: LinkedIn For Good 16

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