On this weekend celebrating the legacy of the Rev. Dr. Martin Luther King Jr., I was reminded again of the words of his Nobel Peace Prize acceptance speech, The Quest for Peace and Justice, given in 1964.
“The well-off and the secure have too often become indifferent and oblivious to the poverty and deprivation in their midst. The poor in our countries have been shut out of our minds, and driven from the mainstream of our societies, because we have allowed them to become invisible. Ultimately a great nation is a compassionate nation. No individual or nation can be great if it does not have a concern for ‘the least of these.’ “
Since then, the gap between the rich and poor has only widened in the US.
The rich and poor rarely live in the same neighborhoods anymore. Heck, the well-off don’t even need to mingle with the less fortunate or use public services if they don’t desire, with private schools, private beach clubs and swimming pools, private country clubs, gated communities and isolated vacation enclaves.
So, if you are an affluent individual who never sees the poor or has no need to associate with the less-well-off, and if you are relatively immune from the cutback in government services, how do you come to understand the desperate lives most people live each day?
I worry about the impact of this social isolation on philanthropy.
Yes, as the sheer numbers of the affluent continue to grow, charitable giving grows. But where does the money go? Read More >>
Thank you to A… for graciously sharing his home for what promises to be a delectable board meeting.
The meeting postprandial will be a lively humanities conversation with our special guest, Christopher Lydon, former host of WBUR’s The Connection and Radio Open Source, now live from the Watson Institute at Brown U. Chris is very eager to learn more about our Council and connect with board members. Personally, I can’t wait to pump him for his vast experience in “curating [humanities] conversations” over the airwaves and now in cyberspace.
Of course, before we can get to Chris and refreshments, we’ve got a board meeting to devour.
Our main course is a discussion, feedback and approval of the goals and programming direction for FY 2008 which RKA, our Executive Director, will be presenting followed by approval of a working budget for FY 2008 that reflects those priorities and outcomes. (Alas, it remains a working budget until Congress finalizes the budget).
Side dishes include a proposed bylaws change on the residency requirement for Board members and feedback from the Governance Committee on Board self-assessments.
Of course, no meeting would be complete without THE CONSENT AGENDA which includes the thoughtful recommendation of grant awards from the Grants Committee, receipt of staff and board committee reports, and final approval of the FY 2008 Board & Board Committee Objectives.
Please arrive so that we can start on time (no excuses, we are back in Providence!) and preserve ample time to savor the planned conversations.
But the reason I wanted to share this with you is that I think it is good practice for the board chair to frame the upcoming meeting for the board. This memo was sent out in advance along with the packet of materials for that upcoming meeting.
My memo also illustrates some of the practices that make for a better board meeting:
Use of the consent agenda to quickly dispose of noncontroversial items, items where the authority for action has been delegated to a committee, or items discussed at a previous meeting that just need a final vote. Of course, any member can ask that an item be taken off the consent agenda for a more complete discussion.
Most of the meeting spent on a few substantive issues.
A conversation with someone really interesting from outside the organization but very relevant to the mission.
And what you can’t see in the memo, good food and social time.
And a few practices that make for a better board and organization:
Clarity on goals and objectives for the coming year
A budget that reflects those priorities
Intentional board practice, including deployment of a governance committee, board self-evaluation, and learning from that feedback.
Unless your organization is very small, with no or very few staff, it’s unlikely that your board Treasurer is directly managing the finances of your organization. In staffed organizations, day to day financial management is done by a chief financial officer, a business manager, the Executive Director, a bookkeeper, or some combination of all of those positions.
So what does a Treasurer do?
It’s pretty common practice for the Treasurer to chair the Finance Committee and present a report of the financial condition at the Board meeting, usually taking the statements that have already been prepared by the staff financial officer and reporting them to the Board. Treasurers tend to focus on the issues that matter to them most. For some, that’s cash position or year-to-date to budget. For others, it’s how the organization is doing compared to last year. Sometimes corrective action is recommended.
While monitoring the financial condition is a basic role, I have higher aspirations for the ideal Board Treasurer. I see this individual as the facilitator of a financial brain trust within the Board (through the Finance Committee) that can help the organization think very strategically about the relationship of mission to money, both short and long term.
So here are a few items I’d like to add to the Treasurer’s job description:
facilitate strategic thinking within the Board about short- and long-term financial vitality
develop financial literacy among all the directors
establish a dashboard or set of key performance indicators that tells the Board at a glance how the organization is doing on critical measures (after facilitating a discussion with the Board on what those critical measures are)
regularly report to the Board on that dashboard
Along with these basic duties:
ensure prudent asset management in accordance with financial objectives and Board-approved policy
ensure that staff implement strong internal controls
oversee development of and monitor compliance with Board-approved financial policies
chair the Finance Committee and ensure that it achieves annual goals and objectives
ensure that staff properly receive and give receipts for all moneys due and payable and deposit all moneys in the name of the organization in authorized financial institutions
What’s in your Treasurer’s job description? I’d love to have you share.
So, it’s now six months after your Board hired a new Executive Director and you still haven’t conducted a performance review.
What are you waiting for?
You owe it to your new ED and to your organization to complete this review ASAP.
As a Board, this interim evaluation can answer the questions that should be on your mind about this new hire:
What impact has this Executive Director had in their first months in office?
How well has the ED fulfilled our expectations at this point in time? (Caveat: How clearly were those communicated to the ED at the time he/she was hired?)
How is this Executive Director perceived among key stakeholders outside of our organization? Inside of our organization?
Have we established the ideal relationship between the Board and the Executive Director? What do we need to do to create that?
Is this an Executive Director we want to keep? If yes, what can we do to ensure that happens? If not, what are our next steps?
Your new ED is likely hungry for formal feedback. A well-constructed review also provides an opportunity for your new ED to answer some questions of his or her own:
Is this job all that I expected? Is it a position that I want to continue serving in?
What does the Board appreciate about my performance to date? My staff? Other constituents?
Are there areas for improvement in my performance?
What is working well about my relationship with the Board? Individual board members?
What can be improved in the way we work together? How?
What does the Board want me to accomplish in the next year? Over the next five years? How does this mesh with what I’d like to accomplish?
What do I need from the Board to succeed in this position?
In writing this blog today, I might be accused of closing the barn door after the horse has left. But all of the warnings for Hurricane Irene coupled with the latest nonprofit embezzlement scandals seemed to cry out for a reminder about preparing for potential risks to your nonprofit organization.
While you can’t avoid every risk or foresee everything that could go wrong, you can take a thoughtful approach to planning for risks that could imaginably happen — and some of the one you couldn’t imagine .
A handy resource is The Nonprofit Risk Management Center, which has a free newsletter published three times a year, a library of free articles and other tools you can purchase.
According to the Center, you can start preparing for risk by 1) completing an inventory of what might go wrong, 2) planning for how you’ll prevent or respond to that potential harm and finally 3) safeguarding your organization from financial ruin in the event something bad still happens.
The Center groups the risks you should inventory into four categories:
People
Property
Income
Goodwill
Your insurance company, the Nonprofit Risk Management Center, and even professional associations like the Public Relations Society of America can be instrumental in helping you figure out what to worry about (as if we don’t have enough worries already) and how to implement adequate safeguards.
You can get started by taking the short tutorial on the Center’s website.
While I’m not often quoting former US President Ronald Reagan, I am rather fond of his “Trust, but verify” when it comes to nonprofit financial oversight.
Last week‘s news brought us two cases of embezzlement from nonprofit coffers. The first was the theft of $1 million over eight years by the controller of the Mark Twain House in Hartford, Connecticut. The theft was noticed by a super vigilant bank employee who questioned the signature on a check. (Note to bank —give that employee a big thank you from all of us. Note to store checkout clerk—could you maybe look at the signatures on credit cards now and then.)
In the other incident, the board chair of the Manhattan Chamber of Commerce was implicated in misappropriating $2.3 million in funds from the Albert Ellis Institute, of which he was the President and Director of Administration.
How could this happen, you might be asking yourself?
“The [Mark Twain House] case presents a hard-earned lesson for the Twain House and other nonprofits. It isn’t the kid driving the van who embezzles from a company; it’s almost always a trusted, well-placed employee. “
Both cases should make you jump now to evaluate the effectiveness of the internal controls at your organization.
While it’s not always possible to prevent theft from occurring, you can create controls that limit the damage and increase the chance of early detection — not the year or more in the two cases mentioned above.
The United Way of Central New Mexico has a free online Internal Controls Tool Kit to get you started.
If your board is like many in the US, July and August might be time for a scheduled break from board meetings. Maneuvering around vacation schedules so the board can still make quorum seems a futile exercise, so many boards just skip meeting in these summer months (in other parts of the world, your break may be at another time on the calendar).
But this is a good time to ask, how often does our board really need to meet?
In many organizations a monthly schedule is sacrosanct. Why?
A common rationale I’ve heard for keeping to a monthly schedule is that board members will be less engaged in the organization if they don’t show up each month. But I wonder if too many of us are unwisely using the board meeting as the only touch point with board members. (Asking directors to a meeting that isn’t a good use of their time won’t build director passion and engagement, no matter how often they meet.)
When you’ve cleared the board meeting agenda of the clutter of committee reporting, gotten adept at dashboard monitoring and instituted a consent agenda to efficiently deal with routine, noncontroversial actions, Read More >>
I love participating in the day because each time I get a fresh business person’s perspective on the nonprofit sector.
This past Thursday, during a discussion about board roles and responsibilities, one of the participants asked if the following situation was typical:
“I went onto the board of a few nonprofits as part of the expectation of my job. It seems it wasn’t enough that I was attending board meetings, and bringing with me a pretty significant corporate gift and my own personal donation. In no short order, I started getting all kinds of additional requests from the staff … like attending events to requests to help open doors or solicit others. They acted like all of this was expected of me.
“I was overwhelmed by the hidden expectations of serving on a board. I had no idea what I was getting into.”
I’d say, unfortunately, that this was the norm, wouldn’t you? Obviously the organization failed to disclose to the board member when he was being recruited what they expected of him. But even if they had, I’ll bet that he still would have received many more requests than he bargained for.
Why is it that once an individual joins a board that staff feel that the board member has made an open-ended commitment to their organization? “It’s their job to…” I hear staff say all the time.
While I love my board members to be thinking 24/7 how their daily contacts might also benefit my organization, realistically, I get it that my organization is likely 2nd or even 3rd on my directors’ priority list for their time, with family, work and maybe even play, ahead of me.
It’s time for our sector’s staff to stop acting like board members are indentured servants and remember them for the volunteers that they are. Sometimes it doesn’t even matter how much time they do put it, it’s never enough.
Take the board member who just did a full sprint on a project you gave them. I’m sure they’d like to take a deep breath before jumping into something else. If you immediately go after them for another time-consuming project, you’re very likely to make that board member feel that the time commitment is too much… and the risks of losing that board member are pretty high.
So what to do? Here’s a tip that the New Directions exec offered. Read More >>
Are you wasting the talents of your Vice President?
In many nonprofits, the vice president of the board of directors is the heir apparent, slated to move into the top leadership position when the current president’s term ends.
So why doesn’t this upcoming leader have anything to do?
The laws of most states don’t require nonprofits to even name a vice president as one of their statutorily-mandated officers.
Tradition holds that nonprofits create a vice president position so they’ll have someone ready to step in should the president be unable to complete his or her term – in the same way we have a vice president of the United States. But your bylaws could just as easily mandate another officer to fill this role.
So rather than taking a perfectly capable board member and only ask them to hold their breath waiting for the president to expire, wouldn’t it be a better use of the VP’s talents to have something worthwhile to do? Especially if part of the process of choosing a VP is to groom that person for leading the board?
Here are three ways to use your VP:
1. Chair of the strategic planning committee
When I asked my networks about experiences of using the VP for something worthwhile, I received only one response. My Chicago-based colleague, Bonnie Koenig of Going International, said she’s seen vice presidents who are charged with carrying forward strategic planning and thinking in their organizations.
What a great idea. Why not make the vice president the chair of strategic planning. Strategic planning should be an ongoing process, not just a Read More >>
“If you are really stuck, you can ask people who know people to help you brainstorm (more about that in a later post).”
As promised, let me say a bit more about asking for help.
It’s ideal to have your next board recruits ready-to-pick from an in-house farm team of committees volunteers, and donors. But most boards that find themselves asking for our help to build a stronger board haven’t created that team (if they had, they probably wouldn’t need our help.)
Even if you have built a farm team, it may be pretty homogeneous, lacking the rich diversity of backgrounds, ethnicity and experiences that you desire.
So, many boards can benefit from recruiting members beyond their inner circle. Here’s an example of how one organization went about it.
I’m working with a neighborhood scale organization that through a series of circumstances, has a board of just a few members. With very few paid staff, this organization needs a true working board willing to take on a number of projects itself. So it is interested in recruiting board members and also volunteers to roll up their sleeves and take on some very practical assignments.
Once we clarified the work ahead, we developed ideal candidate profiles and translated those into a “Call for Board members.” Knowing who we were looking for helped us think about who we wanted to ask for help.
Who we invited.
We brainstormed a list of everything that we could think of, whether we knew them or not, who might know someone who had the qualifications that we were looking for. We made sure that this list reflected the diversity of perspectives we were looking for. Read More >>
“The well-off and the secure have too often become indifferent and oblivious to the poverty and deprivation in their midst. The poor in our countries have been shut out of our minds, and driven from the mainstream of our societies, because we have allowed them to become invisible. Ultimately a great nation is a compassionate nation. No individual or nation can be great if it does not have a concern for ‘the least of these.’ “
