The Leadership Role of Nonprofit Boards


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  • Nonprofit organizations play a vital role in society. Their focus on meeting needs that would otherwise go unmet, espcially in the areas of education, the environment, and social services, has resulted in their increasingly significant role central to the well being and health of our communities and our nation.
  • The purpose of the study for my thesis in Leadership and Organizational Studies was to… In my personal experience in working with nonprofit organizations, I have discovered that there tends to be significant issues associated with boards of directors… And no easy or quick fix to resolve the dysfunction.
  • Too many boards interpret their role as one of overlooking as opposed to overseeing. This results in a reactive mindset rather than a proactive one.
  • This trend has not resolved the issues that face nonprofits. Rather, it has only served to send the message that fixing the board is a difficult task. No matter how many seminars one attends, how many books one reads, or how many consultants promise a transformed board…board structure and governance continue to remain the same.
  • Interviews (face-to-face or by phone). Cumulative of 275 years experience. ED, Board Chair, Consultant, Author Ten predetermined questions, transcribed and evaluated.
  • The current model of effective board governance was identified as one possessing the widely accepted and understoon board roles that emanate from the rather broad and vague “duty to care” legal standard for board performance.
  • “Diversity brings more discussion at board meetings because it’s not a homogeneous point of view. It is a point of view that people will bring from their optics, and I tell you, it’s the greatest discussion, and you are able to make good decisions when people bring points up because they live it and breathe it every day” (Participant 5)
  • By embracing 21 st century thinking, we break the cycle of “we’ve always done it that way” or “if it’s not broken, don’t fix it” (just keep using it to death!) Change is the norm in our world…governance models need to be fluid. Information
  • Nonprofit organizations play a vital role in society. Their focus on meeting needs that would otherwise go unmet, espcially in the areas of education, the environment, and social services, has resulted in their increasingly significant role central to the well being and health of our communities and our nation.
  • The Leadership Role of Nonprofit Boards

    1. 1. The Leadership Role of Nonprofit Boards Presented to Association of Fundraising Professionals Joan A. Hensleit-Minasian, MA March 29, 2010
    2. 2. Nonprofits in the United States <ul><li>Over 1.5 million U.S. nonprofits. </li></ul><ul><li>Play a vital role in society. </li></ul><ul><li>Make up 10% of the US gross domestic product (GDP). </li></ul>
    3. 3. <ul><li>As the number of nonprofits have grown, so </li></ul><ul><li>too have the incidents of scandal and/or </li></ul><ul><li>organizational collapse. </li></ul>Fact
    4. 4. Fresno Met Museum Fails
    5. 5. The Fresno Bee <ul><li>“ From its birth, observers say, the museum </li></ul><ul><li>was hampered by an ill-focused mission, </li></ul><ul><li>uneven leadership and the lack of a steady </li></ul><ul><li>revenue source.” </li></ul><ul><li> Russell Clemings & George Hostetter </li></ul><ul><li>March 6, 2010 </li></ul>
    6. 6. Purpose of the Study <ul><li>To ascertain the experiences and attitudes </li></ul><ul><li>of leaders in the nonprofit community </li></ul><ul><li>regarding the role of nonprofit boards. </li></ul>
    7. 7. What Is Good Governance? <ul><li>The Internal Revenue Service suggests that </li></ul><ul><li>“under the rubric of ‘good governance’, is the </li></ul><ul><li>development by each organization of a system </li></ul><ul><li>of internal controls that is appropriate to the </li></ul><ul><li>organization itself.” </li></ul><ul><li>Sarah Ingram, 2009 </li></ul>
    8. 8. Good Governance is Reflected by… <ul><li>A clear understanding and public expression of an organization’s mission. </li></ul><ul><li>A board with real rules and responsibilities. One that is engaged, informed, independent, and transparent. </li></ul>
    9. 9. Reasons For Ineffective Board Governance <ul><li>A controlling chief executive. </li></ul><ul><li>A board that doesn’t understand the real work of the institution. </li></ul><ul><li>Personal board members who lack accountability. </li></ul><ul><li>An inability of the board to work as a team. </li></ul>
    10. 10. History <ul><li>“Tradition has produced boards that spend </li></ul><ul><li>more time looking over their shoulder than </li></ul><ul><li>over the horizon.” </li></ul><ul><li>John Carver, 2006 </li></ul>
    11. 11. The Reality <ul><li>With a plethora of information, training </li></ul><ul><li>materials and consultants available, nonprofit </li></ul><ul><li>organizations are continually looking outward </li></ul><ul><li>for solutions—for someone to show them </li></ul><ul><li>how to fix the problem. </li></ul>
    12. 12. Question <ul><li>What is the role of the board in nonprofit </li></ul><ul><li>organizations? </li></ul>
    13. 13. Objectives <ul><li>To identify current best and effective board practices. </li></ul><ul><li>To identify the specific governance issues that prohibit a board from achieving its leadership role. </li></ul><ul><li>To identify a systematic approach to transition to a new work model of governance. </li></ul>
    14. 14. Qualities of Boards Effective Boards Ineffective Boards Clear roles (6) Members not engaged (6) Orientation and ongoing training (6) Do not understand roles or responsibilities (6) Diverse (6) Lack of orientation or trainings (4) Uses effective committee structure (5) Lack of diversity (4) Good board and CEO relationship (5) Poor board and CEO relationship (3) Financially supports the organization (5) Bad board meetings (2) Assurance of fiscal health (4) No financial support of organization (2) Focus on mission and vision (3) Lack of confidence in roles (2) Annual review of strategic plan (3) No consistent structure (2) Strategic (3) Staff dependent (2)
    15. 15. Key Themes that Emerged <ul><li>Roles and responsibilities of the board and staff. </li></ul><ul><li>Orientation, education and training. </li></ul><ul><li>Diversity. </li></ul>
    16. 16. 1. Roles and Responsibilities for the Board and Staff <ul><li>Good governance provides the systems and support for both the board and the staff to know and embrace clearly defined and delineated roles and responsibilities. </li></ul><ul><li>A positive relationship between the board chair and the CEO. </li></ul>
    17. 17. Participant Comments… <ul><li>“The relationship between the CEO and the board is pivotal in the board achieving its potential leadership role.” (Participant 8) </li></ul><ul><li>“Everybody has a role, knows their role, and does their role.” (Participant 2) </li></ul>
    18. 18. 2. Orientation, Training & Education <ul><li>Good governance provides the systems and support for orientation and ongoing board and staff training and education (resulting in confidence in serving in their roles). </li></ul>
    19. 19. Participant Comments <ul><li>“An effective board practice is the thoughtful recruitment, orientation, and engagement of people in the work that they are confident about.” (Participant 8) </li></ul><ul><li>“An effective board is one that pays attention to all the functions of a board including its own development towards excellence.” (Participant 7) </li></ul>
    20. 20. 3. Diversity: A Broader View <ul><li>Good governance embraces diversity (ideological), not just for the sake of diversity, but rather as a means to see through different lenses resulting in approaches to accomplishing a mission that normally be missed. </li></ul>
    21. 21. Participant Comments <ul><li>“When I talk about diversity, it’s not just cultural diversity. Ultimately, too, it’s ideological and perspective diversity; because even if you get everyone who is different on the outside, but they all think the same – that’s terrible.” (Participant 3) </li></ul>
    22. 22. Observations <ul><li>Boards can readily identify what they are doing well. </li></ul><ul><li>Organizations know what the results of good governance looks like; </li></ul><ul><li>They just do not know how to get there. </li></ul>
    23. 23. Looking Forward <ul><li>“ To achieve significant, visionary community </li></ul><ul><li>and global improvement, it will require </li></ul><ul><li>different approaches to governance, planning, </li></ul><ul><li>program development, and program </li></ul><ul><li>sustainability”. </li></ul><ul><li>Hildy Gottlieb, 2009 </li></ul>
    24. 24. <ul><li>We have the flexibility to develop a system of </li></ul><ul><li>internal controls that is appropriate to our </li></ul><ul><li>organizations themselves under the rubric of </li></ul><ul><li>good governance – that’s where we need to </li></ul><ul><li>put our energy! </li></ul>
    25. 25. Recommendations <ul><li>21 st century thinking. </li></ul><ul><li>Fluid governance models. </li></ul><ul><li>Mentorship and coaching. </li></ul>
    26. 26. The Leadership Role of Nonprofit Boards Joan A. Hensleit-Minasian, MA [email_address] 559-259-6722