Tag Archive for 'nonprofit boards'

Nonprofit Board 101 - Accountability

Published
by
Hildy
on September 4, 2008
in Boards / Governance, Capacity Building, Nonprofit Planning and Tools to Use Now
. 0 Comments

“My board shows all the signs of NOT being ready to recruit. So what do we do?”

That question came from a reader of my Board Recruitment & Orientation workbook.  She was responding to a chapter that lists indicators for whether or not a board is ready to recruit.  (There is a similar article at our site, for reference as a checklist.)

So I thought it would be helpful to use the blog as a way to address those indicator issues, one at a time over the next several weeks. (And to those readers who are excited about addressing arts issues, from my last post, we will do both - not to fret!)

First up on the hit parade: Accountability

Knowing What the Board is Accountable For
From the chapter in the book:

“If the board doesn’t understand that it is ultimately accountable, and doesn’t understand how to put that accountability into practice, you are not ready to recruit.”

What to do? The following are discussion questions for your board, to provide them with different ways of considering “accountability.”

Following those questions are some steps the board can take to move forward.

NOTE: For the richest learning for the board, do not show them the “answers” before they have the chance to come to answers for themselves.  Stop “teaching” and let them learn.  These steps are a guide, in the event the board gets stuck.  But if what you are seeking is transformation, let the board find their own answers first.

1: Who owns your organization?

Depending on your answer, here is a follow-up question: Who owns your organization according to the IRS (or other taxing authority that provides exemption, depending on the country you are in)?

Once you know who owns the organization, for every decision the board is about to make, they can ask this question: “How will this decision affect the ‘owners’ of this organization?” If the answer is not what those owners would want to hear, the accountable choice is to reconsider that action.

2: What systems does your board use to hold itself accountable?

Systems are methods for turning intent into action, that live beyond just one individual. Board systems include the board’s agenda, its minutes. Board policies regarding how decisions are made. Systems for annual planning, and systems for monitoring progress on those plans.  An annual calendar that says, “Every year in May, we do X.  Every July, we do Y.”  Do all those systems aim at accountability? If a stranger read your meeting agenda, what would they think you are holding yourselves accountable for?

Board systems also include your annual planning itself. Is that planning proactive - encouraging good circumstances while discouraging potentially harmful circumstances?  Or is it primarily reactive?  Which of those two planning systems leads to acting accountably, and which will lead to always putting out fires?

3: Does your board have a board position whose responsibility is simply to keep discussions focused on the things for which the board is accountable?

This is another system approach - an easy one to institute, and a fruitful one for the board’s accountability.  The board president / chair of the meeting has a specific job - moving the meeting’s agenda forward, making sure everyone has had a chance to address the issue, etc. Because of that, the chair cannot also be on guard to be sure the board is discussing things in light of their accountability to the community (yes, that is the answer to #1, in case you had not figured that out).

This is a GREAT job for the immediate past president - a position that is generally squandered. This person has more knowledge of the organization, the community, the mission, the history than most of the other board members. So make your past president the monitor to keep the board on track for its accountability to the community.

4: What is your board currently holding itself accountable for?

There are four functions for which every board is accountable:

• Leadership in providing benefit to the community
• Legal oversight
• Operational oversight
• Board mechanics - the day-to-day work of the board

Some boards focus more in some areas, less in others. What area are you currently focusing your accountability on? What areas would you like to be focusing on? What area would your community want you to be focusing on?

5: How is your board currently holding itself accountable for Creating Community Results (see the first bullet item under #4 above)?

Accountability is about ensuring - being proactive, encouraging and preventing, rather than reacting. And the only way to do that is to annually create a plan that proactively aims at the community results you intend to create, and then monitoring monthly to ensure those results are happening.

6: How is your board currently holding itself accountable for Legal Oversight (see the second bullet item under #4 above)?

If your organization does not have an attorney and an accountant to guide its activities and keep you legal, find those people and get their help in teaching you what to focus on from the legal perspective.

And do NOT seek that assistance pro bono, for a million reasons. Put their fees in your budget and pay them for their best professional knowledge. Have them teach the board what to look for from a strictly legal perspective.

7: How is your board currently holding itself accountable for Operational Oversight (see the third bullet item under #4 above)?

Again, proactive accountability in this area means planning and monitoring. If your board is not planning every year for how the operations will accomplish what it needs to; and if the board is not planning every year for how the operations will prevent undue risk and liability in all areas of the organization; and if the board is not monitoring the results of that plan monthly - well then I can guarantee you will be putting out fires.

If you are not doing this planning and monitoring, how do you know what should / should not be included in the budget you are voting on? (And if you vote to approve a budget that is not based on a proactive plan - either for community results per #5, or for operational results - is that acting accountably?)

8: How is your board currently holding itself accountable for that last bullet item in #4 - Board Mechanics? How does the board ensure it has everything it needs to do its job well?

There are two steps we use with boards in this area. The first is to facilitate a discussion from the board about where they believe the board needs assistance with its day-to-day work. That is generally a terrific discussion, as it brings up all the things board members worry about but don’t generally discuss aloud.

The second step is to budget for that work. The board is accountable for the workings of the entire organization. If your organization is not budgeting at least 1% of its budget to ensure the board knows what it is doing, is that acting accountably? (And I use 1% because it is the smallest whole number I can come up with, and because most boards don’t even budget that!)

1% of a $1 million budget is $10,000. If your board is not budgeting even just 1% of the budget to ensure the board is accountably keeping the organization both moving forward and out of trouble, how will you accomplish what the organization needs you to accomplish?

(That is not a rhetorical question - answer it.  And if your answer is, “We can’t afford it,” realize that that is not an answer to this question.  The question was not, “Why can’t you?” but “How can you and how will you?”  So go back and answer the question precisely as it was asked:  How will you ensure your board has what it needs to do its job?)

That’s it for this first stab at helping boards move beyond “Not Being Ready to Recruit.” If a board does not know what it is accountable for, and has not made attempts to find out, then recruiting new board members to that old mindset will simply perpetuate bad habits.

If anyone has any other suggestions for questions boards can ask themselves to get them to consider what they are accountable for (or if you are a consultant, questions you ask boards), please join in!

* While the title of this post includes the word “nonprofit,” we prefer the more affirmative and declarative term, Community Benefit Organization.  So why use the word “nonprofit” in the title?  Find out here.

Boards and Fundraising - Enough!

Published
by
Hildy
on August 26, 2008
in Boards / Governance, Capacity Building, Community Engagement and Fundraising
. 2 Comments

When will we stop the ridiculous demand that boards get past their “hang-ups” and just get out there and ask people for money? This morning’s Google Alert linked me to yet another article excerpted from yet another book on how to get boards to “Break Through Fundraising Anxiety” - this one from BoardSource, but it could be from anywhere.

When will fundraising and board experts stop treating the passionate, caring adults who serve on boards as if they were errant children, who, despite our ongoing nagging, simply will not take out the trash?

There are solid, not-to-be-messed-with reasons board members do not want to fundraise / ask for money. I have cited those reasons so often I will not bore you all here - you can head here if you want to see some of those reasons, and the Introduction to FriendRaising has more.

For this post, I will just say this: If there weren’t real, solid reasons for not wanting to ask others for money, board members would have years ago gotten past whatever silly thing was stopping them, and they would have just gone out there and raised all the money the industry tells them they should be raising.

So why do the experts (who are, by the way, well-meaning - really) continue to insist that board membership is about fundraising, when fundraising does not have one single thing to do with leading on behalf of the community’s most extraordinary dreams? (And that, by the way, is what Governance is all about…)

The answer is simple: Organizations need money. The demand that boards ask others for money - despite their oh-so-loud-and-clear and nearly universal refusal to do so - comes from the scarcity mentality. If board members would only raise money, then perhaps we could finally be solvent.

What if we try this instead: Let’s make our organizations systemically sustainable - focusing beyond money towards true sustainability of mission.

And then let’s inspire boards to Govern towards their passion - creating significant, visionary improvement in our communities.

Imagine the difference that could make! Imagine what would be possible if we tapped the energy and passion of those millions of individuals who are RIGHT NOW sitting on our boards, waiting to be inspired to act!

Instead of nagging at boards to fundraise, imagine the results if we inspired boards to engage community members in the issues those board members care about!

Imagine the results if we gave boards easy ways to share their stories, their passion, and to engage the wisdom and passion of those around them!

Nothing destroys passion like being told we are not living up to what is expected of us. We don’t feel inspired to do great things; we feel disappointed in ourselves, embarrassed that we just don’t cut it. That is the effect of demanding that boards raise money. They have proven, year after year, that nagging won’t make them do it - it will just make them dispirited. Talk about squandering an incredible asset!

But if board members were inspired to build an engaged community, what a goal that would be! And it would not be because an engaged community will give you money (which, by the way, they will). It would be because building an engaged community is an incredible goal, in and of itself.

And here’s the real kicker: Board members LIKE doing this work! Engaging the community, making real friends for the organization, without asking them for money - it’s fun!

So let’s start aiming at the target, and stop whining about the arrow.

If the target is sustainability, let’s aim at real sustainability - not the kind that comes with huge dollops of wishful thinking (which is what the “Board Fundraising” issue really is - wishful thinking). Let’s aim at building strong, resilient efforts from the inside out.

If the target is an engaged community that cares passionately about your mission and your work, then let’s aim at building that connectedness.

If the target is a board that holds itself accountable for making a significant difference in its community, let’s aim at inspiring them to do so.

I have said this often, but I will repeat it:

An energized board is engaged in making a difference, and engaged in engaging others in making a difference.

So let’s stop berating boards for their “failure to perform” in the fundraising arena, and let’s build sustainable organizations, once and for all.

And let’s get boards out there to do what they are passionate and excited to do - something each and every board member can feel great about doing: Making a difference, and engaging others in making that difference alongside them.

Building an Energized Board

Published
by
Hildy
on July 24, 2008
in Boards / Governance, Capacity Building, Speaking and Keynotes and Travel Stories
. 2 Comments

Greetings from Reno, Nevada!
I thought it might be fun to share some of what we have been doing on this incredible trip, and figured I would start with the mini-workshop we did on Tuesday - Building an Energized Board.

I love doing this particular talk. First, I love talking about boards, as I really believe boards are the most neglected, most often-blamed, most powerful force for change in our sector.

And so, instead of vilifying them (”They leave their brains at the door! They don’t know their role! They won’t fundraise!” and all the other nasty things people say about boards), I love to energize and inspire boards. I love to show boards their potential for creating change - the reason they got on the board in the first place. And I love to show boards how to govern for that.

So how does one energize a board? First, we show them how to govern for what they care about - making a difference in the community. We show them how to align accountability for the means (legal and operational oversight) behind accountability for the end results they provide to the community.

Then we energize boards by showing them how to remove HUGE chunks of time from their board meetings by using a consent agenda. We show them how a consent agenda allows time for discussing the difference they want to make. Or talking about the values they want to model to the community. Or talking about how they might measure the impact the organization’s work is having.

And then we energize boards by building recruitment processes around that energy, showing them how to recruit for What Matters Most to them and to their communities.

And finally, we energize boards by understanding why boards do not want to fundraise - that it is a serious reason, and one consultants would do well to pay attention to, rather than tsk tsking and suggesting that boards should just “get over it” and get out there and raise money.  And so, we energize boards by encouraging them to engage community members in the organization’s mission - not for the purpose of asking for money, but for the end goal of building an engaged community.  And that when they build that engagement, the money comes in - and so does all sorts of other support.

In other words, we teach that an energized board is engaged in making a difference, and engaged in engaging others to help make that difference.

We did all that in 90 minutes, with a book-signing afterward. And even the most skeptical among the crowd took me aside afterwards to tell me, “I have been on boards for years, and only came because our board chair couldn’t make it. And I can’t believe it, but I really do feel energized! There is so much more boards can be doing, that wouldn’t be hard to adopt!”

And that, of course, is the point. It is the point behind all the work Dimitri and I have been doing these past 10 years - developing systems that do not require the ongoing need for intervention.

If we cannot provide systems that boards can easily and happily maintain on their own, what is the point of creating a system no one can follow? No wonder boards catch so much blame - could this sector have made governance work more complicated?

So that was just one stop during our terrific stay in Reno. I will catch you up on the rest of our journey over the next few days, including the incredible community-wide Family Financial Security Summit we facilitated today on behalf of the  United Way of Northern Nevada - a summit aimed at the question, “What would it take to build a community where families are financially stable?”

Until then, I hope you all are enjoying your week as much as we have been enjoying ours!

(UPDATE:  You can find the Family Financial Security Summit post here - what a great day that was!)

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