Referring back to the basics can help to re-center and re-align individuals with the important role they bear...
The current landscape for nonprofit, faith-based organizations is challenging and can make governance work demanding. Often, time and focus are on vision, strategy, and maybe even basic survival. It is easy to assume that all board members know or remember the basic responsibilities of a trustee, but this assumption may be incorrect. Despite the necessary focus on goals and initiatives, it is important to occasionally revisit the basics.
The basic responsibilities of a board are the following:
- Determine and protect the mission and purpose of the organization.
- Select, support, and annually evaluate the CEO.
- Ensure effective strategic planning.
- Monitor and strengthen programs and services, and ensure they are consistent with the mission.
- Protect the organization’s assets and provide proper financial oversight.
- Build a competent board.
- Ensure legal and ethical integrity.
- Enhance the organization’s public standing.
Periodically, a board should ask themselves these specific questions regarding their financial oversight responsibility:
- Is our budget consistent with our strategic plan?
- Do we have sufficient reserves?
- Are any specific expense areas rising faster than expected?
- Are we regularly comparing our financial activity with what we have budgeted?
- Do we have the appropriate checks and balances to prevent errors, fraud, and abuse?
- Are we honoring donor intent and the guidelines and requirements set by our funders?
There is also considerable legal and ethical responsibility. Board members have a legal responsibility to meet the duty of care, the duty of loyalty, and the duty of obedience:
- Duty of Care means that you exercise reasonable care when you make decisions as a steward of the organization. Duty of care requires competency and prudent decision-making.
- Duty of Loyalty is a standard of faithfulness that a board member gives their undivided allegiance when making decisions affecting the organization. You are always acting in the best interests of the organization and not personally.
- And finally, the Duty of Obedience means that as a board member, you act in a way that is consistent with the organization’s mission and obey the law, and the organization’s internal rules and regulations. The basis for the duty of obedience is that you hold the public’s trust that the funds are appropriately used for the organization’s mission.
Board members must acknowledge any conflicts of interest that exist. A conflict of interest refers to a situation where a certain board member’s interests or activities, whether personal or professional, compromise their duty and responsibility to the organization. When faced with a conflict of interest, the board must consider whether the actions and decisions of the member in question can be considered impartial and, in the organization’s best interest. It is rare not to have some conflicts of interest when serving on a board, especially if the organization is in a small community. It is important to acknowledge and be transparent about any conflicts of interest and refrain from making decisions where the conflict of interest exists.
A board member’s role that is often overlooked is their responsibility to serve as advocates for the organization. Board members are ambassadors meaning you make use of opportunities to articulate the organization’s mission, goals, and accomplishments to people outside of the organization.
As an individual board member, these are responsibilities for you to consider:
- Attend all board and committee meetings and any events where your role as ambassador or advocate is needed.
- Be informed about the organization’s mission, services, policies, and programs.
- Serve on committees and take assignments as requested.
- Be prepared for meetings: Review the agenda and supporting materials before board and committee meetings.
- Make a personal financial contribution to the organization. This shows your commitment and investment in the mission of the organization.
- Support succession planning which is often focused on the CEO role and should also focus on senior leadership as well as board leadership.
- Keep up to date on developments in what’s happening with the organization, both inside and outside of the boardroom.
- Annually sign and follow conflict-of-interest and confidentiality policies.
- Refrain from making special requests of the staff and going around the CEO. The board speaks with one voice and one board member may not make decisions or take actions on behalf of the whole board.
- Know and understand the organization’s bylaws
In his book, The Wise Leader, Uli Chi writes “Healthy institutions need good trustees at all levels. In keeping with Jesus’s vision of leadership, trustees are servants who bear the institution’s pain and offer hope.” Which is a tall order and comes with having a sense of call and purpose in the trustee role. Referring back to the basics can help to re-center and re-align individuals with the important role they bear.