In the last year I have had more requests than ever before to spend time with nonprofit boards on governance issues. Most frequently I have been asked to help educate Board members on their roles and responsibilities and
to assess their performance and effectiveness.
The presentation I use for Board Education begins with some attention getting items ripped from the headlines about a Board's failure to effectively govern and steward the organization. Today's Pittsburgh Post Gazette has an article that will surely make it into every future Nonprofit Consultant's Governance presentation.
Among the lessons we Board Members and Nonprofit Leaders need to
take from this:
1. Boards and CEO's need to be partners in organizational governance. The Board must be neither a "rubber-stamp," yielding all decisions to the CEO and never probing beyond the surface of what is presented, nor the micro-manager who insists on getting involved in day-to-day operations.
2. A best practice is for the Board to plan a regular "Executive Session" which is a brief meeting without the organization's staff in attendance. This allows for open discussion of issues regarding staff or organizational performance. In my experience, Board members often hesitate to openly state their concerns when the CEO or other staff are present. And, it can be nerve-wracking to a CEO when an Executive Session is scheduled out-of-the-blue. So standing Executive Sessions are recommended, typically at the end of a board
meeting. If there is no business to discuss during these Executive Sessions then they are very brief.
3. Finally, and I can't stress this enough, the Board has a duty to conduct formal and objective Performance Evaluations of the CEO. Only 65% of Board's do this and a minority of boards do a good job (as reported by CEO's). ADDITIONALLY, Boards should regularly undertake an evaluation of their own governance, practices, and performance. Even fewer Board's do this. An anonymous survey conducted by an objective outsider (like a consultant) often identifies hidden problems and major opportunities for improving a Board's performance.
Here are a few noteworthy quotes from The PG Article:
",,,boards need to operate as equal partners with their presidents, experts
said in interviews. Too often, a board may act with excessive deference toward a president, as seemed to be the case at Penn State, where Mr. Spanier's 16-year reign had brought the school to new heights academically.
At the other extreme, said Richard Chait, a research professor at Harvard's graduate school of education, board members can become "self-appointed vigilantes," looking to attack and expose an administration and delve into areas where they don't belong. "The answer lies in the middle," said Mr. Chait, ..."The board needs to create a climate in which presidents are encouraged and rewarded for disclosure of problems," Mr. Chait said. "And presidents need to create a climate that encourages trustees to be inquisitive, persistent and skeptical, and -- if there's a need -- critical. Presidents should not view that as a vote of no confidence."
A board is charged with oversight, rather than the day-to-day management... Conflicts inevitably arise and can be challenging."
Read more: http://www.post-gazette.com/stories/local/state/psu-trustee-expressed-initial-concerns-644859/#ixzz20nIc8S3L