Is a Board of Directors Really Important?

Board of Directors Role: What Exactly Should Your Board Be Doing?

Throughout my time with nonprofits, I’ve noticed that a board, along with its directors ability to fulfill their roles and responsibilities can be the difference between a high impact agency, a low impact agency, and one that eventually has to shut its doors.

It’s important to note that a board has both legal duties and oversight responsibilities.

Legally, there are duties imposed on boards and directors for a nonprofit. I strongly recommend consulting a trustworthy attorney to make sure your board is meeting this minimum level of responsibility.

What are these duties?

Duty of Care: Boards and directors are expected to exercise reasonable care in carrying out their duties. They must meet the standard of what other reasonable people would expect of them, or they themselves would do if in the same or similar situations.

Duty of Loyalty: Boards and directors must make their decisions based on what is in the best interests of the organization. This includes avoiding conflicts of interests and obtaining personal gain through board service. First loyalty is to the agency.

Duty of Obedience: Boards and directors must adhere to all applicable government laws and regulations, its own bylaws, and must remain true to its stated mission.

While these three duties a top priority, you also need to pay attention to the board’s oversight responsibilities.

Top 10 Oversight Responsibilities for your Board of Directors: 

1. Set direction, establish policy, monitor progress and compliance
2. Manage only one employee—the chief executive or executive director. Effective boards are not staff or volunteer supervisors and should not involve themselves in day-to-day activities
3. Approve (and often participate in the setting and creation) of the organization’s mission, vision, values, major strategies and major goals/outcomes
4. Establish the parameters within which the chief executive is expected to achieve the goals/outcomes
5. Monitor the organization’s performance towards the approved goals/outcomes.
6. Promote transparency, accountability, and sustainability
7. Selects, fairly compensates, nurtures and evaluates annually, a chief executive officer or executive director
8. Ensure financial solvency and integrity through policies and oversight
9. Require periodic financial and legal external audits to ensure compliance with the law and sound practices
10. Evaluate and constantly improve the board’s structure and process, holding the chair accountable for managing the board with integrity

That may seem a bit daunting. You can make it easier by understanding the actual role(s) of your board and individual members in moving your organization forward. 

Understanding The Board of Directors Role

In addition to fulfilling their legal duties and oversight responsibilities, your board members may perform a variety of other tasks, depending on the size of your nonprofit. Some smaller agencies have working boards that are involved with day-to-day activities, while larger nonprofits may be able to offload these responsibilities to staff members, leaving the board to perform in a leadership role instead.

12 Roles Your Board of Directors May Fill

• Fundraising / generating needed funds
• Marketing and Advertising
• Outreach, community relations, and serving as agency ambassador
• Risk Management — assuring the organization itself is properly protected while carrying out its mission
• Using unique professional skills to help advance the organization, like CPA, attorney, social media expert, etc.
• Fill and serve on board committees
• Identifying and recruiting qualified candidates for future board service
• Strategic thinking
• Protecting the organization’s mission/vision/values
• Insuring effectiveness in the organization’s programs
• Supporting the chief executive officer/executive director in their efforts
• Advocating and informing others about important related issues

Overwhelmed? I know. I’ve been there! 

Successful boards separate themselves from the rest in how they balance all of these facets at once. Clearly defining the board of director’s role and responsibilities in a nonprofit can be a challenge — a big challenge. This job requires effective board/board committee meetings that hold directors accountable for their commitments. With effort, ongoing communication, strategic thinking and patience, your agency is sure to thrive.

It’s not easy, but trust me, it’ll all be worth it.