The Leadership Role of Nonprofit Boards

The Leadership Role of Nonprofit Boards

Presented to

Association of Fundraising Professionals

Joan A. Hensleit-Minasian, MA

March 29, 2010

Nonprofits in the United States Over 1.5 million U.S. nonprofits.

Play a vital role in society.

Make up 10% of the US gross domestic product (GDP).

As the number of nonprofits have grown, so

too have the incidents of scandal and/or

organizational collapse.

Fact

Fresno Met Museum Fails

The Fresno Bee

“From its birth, observers say, the museum

was hampered by an ill-focused mission,

uneven leadership and the lack of a steady

revenue source.” Russell Clemings & George Hostetter

March 6, 2010

Purpose of the Study

To ascertain the experiences and attitudes

of leaders in the nonprofit community

regarding the role of nonprofit boards.

What Is Good Governance?

The Internal Revenue Service suggests that

“under the rubric of ‘good governance’, is the

development by each organization of a system

of internal controls that is appropriate to the

organization itself.”Sarah Ingram, 2009

Good Governance is Reflected by… A clear understanding and public expression

of an organization’s mission.

A board with real rules and responsibilities. One that is engaged, informed, independent, and transparent.

Reasons For Ineffective Board Governance A controlling chief executive. A board that doesn’t understand the real

work of the institution. Personal board members who lack

accountability. An inability of the board to work as a team.

History

“Tradition has produced boards that spend

more time looking over their shoulder than

over the horizon.”John Carver, 2006

The Reality

With a plethora of information, training

materials and consultants available, nonprofit

organizations are continually looking outward

for solutions—for someone to show them

how to fix the problem.

Question

What is the role of the board in nonprofit

organizations?

Objectives1. To identify current best and effective board

practices.

2. To identify the specific governance issues that prohibit a board from achieving its leadership role.

3. To identify a systematic approach to transition to a new work model of governance.

Qualities of BoardsEffective 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)

Key Themes that Emerged

1. Roles and responsibilities of the board and staff.

2. Orientation, education and training.

3. Diversity.

1. Roles and Responsibilities for the Board and Staff 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.

A positive relationship between the board chair and the CEO.

Participant Comments… “The relationship between the CEO and the

board is pivotal in the board achieving its potential leadership role.” (Participant 8)

“Everybody has a role, knows their role, and does their role.” (Participant 2)

2. Orientation, Training & Education 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).

Participant Comments “An effective board practice is the

thoughtful recruitment, orientation, and engagement of people in the work that they are confident about.” (Participant 8)

“An effective board is one that pays attention to all the functions of a board including its own development towards excellence.” (Participant 7)

3. Diversity: A Broader View 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.

Participant Comments “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)

Observations Boards can readily identify what they are

doing well. Organizations know what the results of

good governance looks like; They just do not know how to get there.

Looking Forward

“To achieve significant, visionary community

and global improvement, it will require

different approaches to governance, planning,

program development, and program

sustainability”.Hildy Gottlieb, 2009

We have the flexibility to develop a system of

internal controls that is appropriate to our

organizations themselves under the rubric of

good governance – that’s where we need to

put our energy!

Recommendations 21st century thinking. Fluid governance models. Mentorship and coaching.

The Leadership Role of Nonprofit Boards

Joan A. Hensleit-Minasian, MA

minasian@comcast.net

559-259-6722