ESTABLISHING A BOARD OF DIRECTORS
There are two general types of boards:
Advisory board: An advisory board serves in the same capacity as
a committee. Their role is to provide support and guidance for the
organization’s efforts. They have no regulatory control and no legal
responsibility. An advisory board supports the organization by making
recommendations only. They have no governing responsibilities and
legally may only make recommendations.
Governing board: A governing board carries the weight of local,
state, and federal regulations. Their vote determines guidelines, staff
placement and salary, and develops program policy. Members serving on a
governing board should be aware of their legal responsibilities.
A well-balanced board exhibits diversity of skills, perspectives and experience.
The role of a board member:
A board member should support the efforts of the organization served.
They have tremendous ethical responsibilities. Their role is to assist
with planning and determine the course for the non-profit. A strong
board of directors can guide an organization towards its greatest
potential. Board members represent the organizational voice to the
A board member should be willing to place the organization goals over
personal interests and professional desires. They should conduct
themselves ethically and avoid any appearance of personal or
professional gain from the activities of the organization.
The organization’s size should be the initial determining factor when
considering how many individuals are required to develop a quality
board of directors. Diversity in culture, gender, and age should be an
important consideration. The board should have sufficient numbers to
allow board members to distribute their work evenly. It is important
that board members don’t feel overworked.
Good candidates for board membership:
Consider the area of expertise that a potential board member can
bring to the group. For instance, an organization seeking to enhance
its fundraising efforts through endowments might consider an attorney
with will and trust expertise. A non-profit seeking to increase
contributions from small local businesses should consider established
business leaders or local bankers. If corporate donations are the goals
for your support, you should include mid and senior level managers from
local plants or offices.
Board members should be willing and ready to:
Work on special projects as requested by the executive team
Provide leadership to the organization
Attend meetings and events-give time
Commit resources and expertise to further develop the organization
Accept committee assignments
Use their network of relationships to benefit the organization
Board members should support:
The organization’s mission and strategic/action plan
Specific programs and events
The financial development of the organization through active fundraising and grant seeking efforts
Fostering new donors to the organization
The organization with a personal membership donation
Board term length:
An average term of office is three years. Many organizations place
term limits for board members such as “ terms are limited to two,
3-year tenures” - or they require a hiatus of one year before they are
allowed to be elected for another term. Staggering the board terms -
so that no more than 1/3 of your board members is up for re-election in
any one year - ensures a balance between new board members and
experienced existing members. Term limits will provide an opportunity
to seat new members with new thoughts, ideas and resources.
Key elements to a solid board structure:
Written descriptions for board responsibilities
Written descriptions for committee responsibilities
Written statement concerning conflicts of interest
Directors and Officers liability coverage
Vital materials for running an efficient board:
Audited financial statements
Marketing and financial plan
Current Board roster
An organizational chart for the board and for the staff
Documented policies and procedures
A Schedule of meetings with consistent meeting structure
Detailed minutes of meetings containing reports on activities and projects
Committees provide a framework for accomplishing an organization’s
tasks. All board members should serve on at least one committee.
Committees may include community members who are not currently serving
on the board. It is important to make certain that committee work
takes place outside of board meetings – board meetings are reserved for
the reporting of committee work, policy decisions and other official
Basic essential committees:
Executive Committee (made up of board officers, including immediate past president)
Finance Committee – chaired by the board Treasurer
Marketing & Fundraising Committee
Community Relations Committee
Whatever other committees are required to carry out the organization’s mission.
Can minors serve on boards?
Each state is different. There are specific laws that prohibit minors
from signing contracts. It is important that an organization seek legal
counsel before allowing minors to serve as a board member. To encourage
young people and gain feedback from a youthful demographic, consider
adding minors as nonvoting,
ex-officio members to the board or allow them to serve in an advisory
capacity. Minors cannot take fiscal responsibility for any registered
Ethical Implications for Non-profits:
The best way to avoid difficult ethical situations is to establish a
set of standards early in the development of a board or organization.
At the most basic level, a board should have a statement of ethics
detailing prohibited behavior and conflicts of interests. If the
organization or board accepts state or federal funds, consideration
should be given to the following:
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Personal loans should never be made to other board members, directors, or staff;
Board members should never work to gain attention for their own profession or place of employment;
A system for independent audits should be in place;
Financial statements should be accurate and complete;
Develop a written formal process to deal with complaints and prevent retaliation;
Establish a written formal process for document destruction.