Too many boards are micro-managing the affairs of nonprofit organizations to the frustration and discouragement of the staff involved. Often, instead of recruiting high calibre executives well-experienced in running a substantial business, boards tend to rationalize their hands-on behaviour by specifying clerical level assistance. The problem is that, almost by definition, since volunteer board members usually have their own jobs to hold down, they not only don't have the time to micro-manage, they also often don't have the skills to do so either.
John Carver, author of Boards That Make a Difference, and one of the gurus of volunteer board governance, now argues that "All board authority delegated to staff [should be] delegated through the Executive Director (or President/CEO), so that all authority and accountability of staff - as far as the board is concerned - is considered to be the authority and accountability of the Executive Director."
More senior staff officers being called 'President'
Generally speaking, paid staff are highly trained administrators and are increasingly being well paid to manage the affairs of organizations that often have million-dollar budgets. Indeed, Carver points out, increasing numbers of nonprofits are calling their senior staff officer the president, and even the chief executive officer, to underline the executive responsibilities of the position.
The title of president, in the past commonly attributed in nonprofit organizations to the senior board member elected to an executive position, is now increasingly being changed to chairman of the board, or just chairman. This follows closely the quantum shift being experienced in the for-profit sector, where there is currently substantial pressure to separate the responsibilities of chairman and chief executive officer. If the senior elected board member in a nonprofit organization assumes the title of chairman, says Carver, they are much better placed to ensure that the board imposes checks and balances on paid staff performance than would be the case if they were expected to carry executive duties and responsibilities as well.
Set up "executive limitations policies"
Carver goes on to recommend that the board "direct the executive director to achieve specified results, for specified recipients --through the establishment of ends policies." The board further should ideally limit the latitude that the executive director may exercise in practices, methods, conduct or other `means' to the ends by setting up executive limitations policies. According to Carver, "As long as the executive director uses any reasonable interpretation of the board's ends and executive limitation policies, they should be authorized to "establish all further policies, make all decisions, take all actions, establish all practices and develop all activities."
Where should board authority end and staff authority begin?
Again, Carver recommends "Only decisions of the board acting as a body [be] binding upon the executive director." This presumably would exclude decisions or instructions of individual board members, officers or committees, except in rare instances when the board has specifically authorized such exercise of authority. In addition, whenever board members or committees ask for information or assistance without board authorization, the executive director, says Carver, should be able to refuse any requests that require - in their judgment - a material amount of staff time or funds, or that are disruptive.
The moral is, perhaps, that nonprofits should define carefully both board policies and staff job descriptions, and then go out and recruit the best available candidate the organization can afford. It will probably be the most cost-effective route, particularly if the organization has suffered from declining memberships, reduced contributions, or an increased demand for value for the money and time involved in belonging to the organization.
Once you have competent senior staff in place, Carver stresses, make sure that if board committees are necessary, their assignments are to assist only in the board's job, never to interfere in the direct link between the board and its executive director, and never in a way that fragments the wholeness of the board's job.
Brian Lechem is the president of Boardroom Advisory Services and the Editor of Boardroom, a monthly newsletter of review, analysis and guidance for corporate directors. For more information, call (416) 494-1440.