Effective Not-For-Profit Boards

The powerful combination of a desire to give to the community and to create and sustain an effective organization attracts passionate and dedicated people to not-for-profit boards.

However, sustaining that dedication and passion is important for the organization in the long term.

The best way to maximize a non-profit board’s expertise is to ensure the board fully understands its governance responsibilities and the parameters of its leadership role. As organizational leaders, the directors not only focus on compliance, legal requirements, hiring and firing the CEO and fundraising, it plays a stewardship role. This means ensuring adequate strategic and operational planning, setting performance standards, measuring efficacy and building and developing the board itself.

There are seven key elements that ensure an effective approach to governance, says Jeffrey Wilcox, President and CEO of Executive Consulting For The Not-for-Profit Sector:

Understand The Mission: Why We Exist

Your board may be able to state the organization’s mission, but does it understand how it influences its role in the organization’s success? A mission statement, according to David Collis and Michael Rukstad at the Harvard Business School, should describe the agency’s underlying reason for being a service provider and what contribution it hopes to make to society. A firm understanding of the organization’s mission will aid board directors in helping to oversee policies, programs and priorities that meet the organization’s purpose.

Know The Values: What We Believe in and How We Work

The agencies’ values statement guides how volunteers and staff will behave towards clients, other service providers, funders and other stakeholders. The values also govern how the board interacts with the rest of the organization and provides the means by which the mission is accomplished. This is not to say that a values statement represents a code of conduct. Rather, it determines how the organization serves the community and its volunteers and staff. The board is charged with ensuring that the agency mission is executed in keeping with the values of the organization.

Define Success: How We Know We Are Making A Difference

Your not-for-profit board must grasp what success means for the organization—what does the mission statement and the described values point to by way of defining success. If the mission is to be realized what does that look like and how are people in the organization going about bringing the mission to fruition? This means the board needs to be aware of what success means to the group, agency or organization as well as determining what makes for an effective board.

Determine the Directives: What Are Our Priorities

What are the organization’s priorities? These are governed by the mission and describe what the agency does. The board must understand the organization’s priorities and these need to be clearly defined. Otherwise, the agency will try to be something for everyone. This is a compassionate stance but one that will burn the organization out. Knowing what the priorities are will define the organization’s activities and ensure its survival – which is key to serving clients or conducting agency business.

Execute the Strategy: Implement The Game Plan

The organization’s strategy refers to the overall plan based on the values and mission of the organization. Your strategy should inform the board, staff and volunteers as to how their activities combine to make the organization successful. An effective strategy will support the board, staff and volunteers to make the difficult choices confronted regularly by not-for-profit agencies. Good governance requires that the board oversees the implementation of the strategy and keep itself and the organization faithful to it.

Measure CEO Performance

The board’s mandate is to evaluate the Chief Executive Officer or Executive Director’s effectiveness in carrying out the mission, values, priorities and strategy of the organization. Board leadership requires an effective relationship with the CEO. This is maintained through adequate feedback mechanisms including regular performance reviews. When reviewing the CEO’s performance, the Board needs to understand the priorities of the organization and be able to measure how the CEO carries out these priorities.

Develop Community Leaders

The board’s role is to develop its directors and the CEO as effective community leaders. Community good depends on a commitment to the growth of those who choose to serve agencies dedicated to helping others. Ensuring that the CEO and the board receive learning opportunities and the means to make progress as leaders is key.

Leadership at the board level requires directors to understand their important stewardship role in the organization and to keep focused on effective governance as the means to this important end.

Dr. Jennifer Newman is Vice-Chair of the RainCity Housing And Support Society Board of Directors. RainCity Housing and Support Society provides housing and support for people living with mental health, substance use and other challenges.
Dr. Jennifer Newman and Dr. Darryl Grigg are registered psychologists and directors of Newman & Grigg Psychological and Consulting Services Ltd., a Vancouver-based corporate training and development partnership. They can be contacted at sunmail@newmangrigg.com

Identifying information in cases cited has been changed to protect confidentiality.

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