5 Actions by Boards That Destabilize Nonprofits and What To Do About ItMay 04, 2023
Board recruitment is a challenging endeavor that requires a great deal of vetting, analysis, and careful consideration. It is important to get this right because selecting the wrong person can send even the strongest nonprofit spiraling out of control.
The uncertainties that come with bringing in new members make many nonprofit Executive Directors and CEOs shudder when they think about recruitment. The right board composition can help organizations thrive and grow. On the other hand, misaligned members or individuals with private agendas can quickly destabilize strong and robust organizations. In fact, it only takes one board member who either does not understand their role or has an agenda of self-interest for an organization to spiral out of control.
Destabilizing Nonprofit Board Behavior
Effective board management and organizational oversight strategies should both support and direct the Executive Director and the mission. The following behaviors, on the other hand, can quickly destabilize high-impact organizations that are well-managed by creating a culture of uncertainty, fear, and programmatic stagnation:
- When board members call staff members directly and instruct them to do work without going through the executive director first. This leads staff members to be confused as to whose instructions they should follow, which can disrupt the workflow of the organization.
- When staff members receive gifts as incentives for work they have completed on behalf of board members that are outside of the workload assigned by the executive director. This behavior undermines staff morale and creates the impression that there are favored employees to whom the rules don’t apply, which breeds resentment and chaotic team dynamics.
- When board members identify staff members that they do not like and begin a campaign to fire them. This creates a culture of fear, distrust of the board, and results in great confusion regarding the chain of command. It also increases the risk exposure of organizations.
- When board members begin a campaign to sabotage, micromanage, and undermine the Executive Director, with the ultimate goal of becoming the new Executive Director. This is unethical and diminishes the trust of funders, staff members, and the public. It also compromises the long-term vision and mission of the organization.
- When the Board members do not follow their bylaws, make up their own rules, and do not follow their own decision-making process. This dynamic can be toxic and can lay the foundation for legal action against that organization by increasing the risk exposure of the organization due to compliance voids. Creating an ethical culture in a nonprofit is an essential pillar of its mission. Thus, board members must work in a manner that is serious, ethical, and in accordance with the law.
Good Board Governance is the Cure
Good governance, on the other hand, is the keystone to preventing and managing risk in a nonprofit. This is why it is important to invest a significant amount of time in vetting new board members and helping them understand the role that they should be playing in the organization. The ideal board members:
- Are engaged in fundraising,
- Fill a skill set void for the Board;
- Support the Executive Director, without micromanaging while creating accountability systems;
- Serve as involved fiduciary stewards that do not attempt to get involved in daily transactions;
- Understand how nonprofits work;
- Provide resources and support that help the organization implement the strategic plan; and
- Provide reasonable checks and balances for the Executive Director.
These characteristics then allow for the board to focus on effective governance, functionality, and maintaining ethical organizations through the following:
* Adhering to the standards, procedures, and processes of the organization;
* Meeting their fiduciary responsibilities;
* Defining the strategic vision of the organization and engaging in supervision;
* Using authority properly and maintaining a separation of duties;
* Maintaining clear communications;
* Maintaining a culture of accountability; and
* Creating a culture of transparency and ethical practices.
In short, corporate governance requires that a nonprofit board of directors leads by example. This is accomplished by maintaining an appropriate separation of duties and members must use their authority appropriately. This means that the board does not become involved in the day-to-day operations of the organization. Communications are directed to the executive director for any requests or questions. Maintaining this separation improves stewardship by preventing: 1) power-plays that are intended to undermine the executive director, 2) throwing the work balance for employees off-kilter, 3) compromising the ability of the organization to meet deadlines, and 4) eliminating confusion about decision-making and the chain of command in the organization.
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