Putting a sparkle into non-profit boards
Many of the organisations I am fortunate to work with are in the non-profit or social enterprise world. In these sectors, the governance model combines many of the legal responsibilities of being a Company Director or Professional Partner with the reality that Board Members or Trustees are usually part-time volunteers who donate their time and expertise pro bono, and are almost always unable for regulatory reasons to take payment for their contributions.
It's no longer automatically the case that Trustees are simply recruited from the "great and the good" - maybe as some sort of honorarium that carries no meaningful obligations. Increasingly, Boards reflect a healthy diversity of gender, age, ethnic and occupational backgrounds - not necessarily the ranks of retired or semi-retired professionals, "pale, male and stale." A diverse Trustee Board is healthy because the members will have different and complementary viewpoints and experiences; and, often, greater diversity reflects more accurately the composition of the communities that the organisations seek to serve, and allows the Board to be more in tune with service users, volunteers and supporters.
As I wrote about recently in another post, such visible diversity is generally necessary, but seldom sufficient by itself, for any team with a common purpose to perform effectively. The general principles that apply to all high-performing teams translate just as much to Trustee Boards, with the added complication that here, the team members may not know each other at all well, will often meet very infrequently and as noted above are committing their own time for free.
The pay-off to charities and social enterprises for Board Effectiveness is substantial. It ensures that the charity's managers are guided, supported and mentored; strategic decisions are made diligently; that the resources of the charity are used well; and that regulatory and legal requirements are met. Effective Trustee Boards reduce the risk of poor management, misuse of funds and unfocused activity.
How to ensure this?
One action that Trustees can consider is an independent Board Effectiveness review. This may take the form of a survey, followed by telephone interviews, with Trustees and often some of the charity's Senior Managers. It may also include an audit of their technical and personal skills; and observation of them working together at Board meetings.
Areas to probe in a Board Effectiveness review include:
alignment around priorities
quality of decision making
how well members interact with each other in and out of meetings
effectiveness of communications between Trustees and the Senior Leadership
the role of the Chair
the board size and composition
understanding of legal and regulatory responsibilities
Such a review is likely to highlight areas for action, both immediate and longer-term, and cast light into places where there is developmental work to do. As one example, a recent review that I conducted raised concerns around tenure - how long Trustees are appointed for, and how and when they are replaced. As a result, the Board started work on a succession plan that included the rotation of members, bringing new Trustees in over a planned period rather than all at once, and profiling them against the current - rather than the historic - needs of the organisation. The new Board will reflect "what the charity needs to be able to grow" and it is evident it will be more diverse, bringing in fresh and valuable skills and experience.
The National Council for Voluntary Organisations (NCVO) provides excellent guidance on conducting a Board Effectiveness review, and around good non-profit governance in general. I know from my own experience that being a Trustee can be personally rewarding, a great way to volunteer, and an opportunity to transfer skills from one domain - in my case, working in an international private sector organisation - into another, the charity sector.
NCVO has been working with specialist recruiter Trustees Unlimited to create a pathway, Step on Board, to make it easier for corporate managers to become Trustees in this way, with pathways for individuals as well as for programmes sponsored by employers. In a review that I conducted for NCVO earlier this year, there were identifiable benefits of Board Placement for sponsoring organisations in terms of talent development, employee engagement and community connection - as well, of course, as the rewards for the participants and charities themselves.