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Friday, June 24, 2011

The Care and Feeding of an NPO Board - Spencer

If you’ve read any of my previous blogs, you’ll understand that I live in a world of analogy (and you may well be weary of it – Sorry, there is more of the same in the hopper…). Actually, I kind of like the title I’ve chosen, though something tells me that I’m robbing someone of a previously penned saying. It speaks to the CEO’s relationship with his/her governing board. Though it sounds a little derogatory - comparing a board to a child or even a pet - it is not meant that way at all. The comparison is simply meant to demonstrate the need for a CEO to provide a board with the sustenance needed to not only survive, but to grow strong and prosper. These nurturing relationships of course differ slightly, but the base concepts are actually quite similar. From this point forward, I’ll avoid reference to a pet and humanize this a bit more. Let’s first consider a board in its infancy.

A newly formed board in a startup NP will often need significant guidance from an experienced professional – one with a deeper understanding of the intricacies of non profit organizations and the oft intangible value of service, versus the fiscal bottom line to which they are accustomed. It is in, well - infancy. As opposed to a human infant however, a new board is likely comprised of seasoned professionals from the private world, who have come together in support of a common cause – generally to fill a void in the community which is not being addressed by government or other means. Members, following their professional (generally for-profit) roots and training, will have likely created (or adopted) a mission statement to help guide their collective actions, and may even feel a bit smug about it. However, given their institutionalized proclivity to follow the “for profit” model to which they are predispositioned, they are in fact, infants in the NP world and will need guidance to successfully navigate the choppy waters. If they are gifted infants, their first decision will be to hire such a person to moderate and guide the subsequent, formative proceedings. Their decision at this stage could easily make or break the enterprise. Lets assume that they make to correct decision and hire the right CEO for the job. We now enter the care and feeding phase.

In my opinion, the CEO’s job encompasses much, much more than ensuring that mundane business tasks are completed. The CEO must skillfully guide the board to success. Make no mistake – The Board should be in charge of an NPO. In a functional operation, it sets to tone for all overarching themes of existence. The CEO is responsible for ensuring the reverberation of that mission through every crevice of the organization. However, a good NP CEO should ensure that the board is ever cognizant of the mission it has set forth, and will take the requisite steps to make certain that all board members, no matter whether green or well seasoned, do not lose sight of their objective. Further, the CEO should provide opportunities for introductory and ongoing training in areas such as fundraising and strategic planning. While some may consider such efforts as providing “busy work” to keep the board from interfering with staff functions, it is far more important than that. In their article Stakeholder perceptions of governance: Factors influencing presidential perceptions if board effectiveness, Proper, et al. tout the importance of ongoing training in achieving and maintaining board focus on primary responsibilities. As stated above, care should be taken by both the CEO and the board to ensure requisite separation between the two. In many instances, the role of parent and child become equivalent and also reverse. The NPO Board should ultimately remain in charge. This is a healthy relationship which protects the Board, the CEO and most importantly, the organization. It amounts to the Ronald Reagan / Cold War mantra of “trust but verify.”

One final thought on care and feeding – The board should be provided with ALL the critical information. Withholding bad news (typically either financial or legal woes) is a supremely flawed tactic. Even if you as CEO, have already recognized and corrected the problem, the Board needs to know about it. Trying to sweep it under the rug will only compound the issue. Trust is paramount and once a board loses trust in the CEO, it is rarely regained. That which you strive to feed will take a big bite out of you.

Proper, Eve, et al. 2009. Stakeholder perceptions of governance: Factors influencing presidential perceptions if board effectiveness. International Journal of Educational Advancement Vol. 9,3, 166-173.

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