Board Development and Management for Nonprofit

Friends Groups

Peer-to-Peer WorkshopSeptember 6, 2014

Let’s Get Started

Please introduce yourself: Name Refuge Role with Friends group One thing you hope to get out of

today’s discussion

Goals for This Presentation

Build community. Cover roles and responsibilities of nonprofit

boards. Learn about the evolving meaning of

governance and why it is important. Talk through strategies for board

development and engagement Become familiar with the resources available

to support nonprofit leaders. Focus on finding the “on-ramp” for each

group.

C4NPR Workshops Becoming a Networked Nonprofit, October 2013 Human Resources – When an HR Department is not in the Budget, Sept. 2013 Board Governance and the Fundraising Process, August 2013 Nonprofit Finance Fundamentals, June 2013 Outcome Measurement and Program Evaluation, May 2013 Philanthropy Begins at Home: Developing a Successful System for Board, Staff and Volunteer Giving, April

2013 Nonprofit Sustainability: Making Strategic Decisions for Financial Viability, April 2013 Governance as Leadership: The Purpose of the Board and Board Member, February 2013 Adaptive Leadership, September 2012 Managing Up, Managing Down: The Board-Executive Paradox, September 2012 Meaningful and Manageable Outcome Measurement, May 2012 Leadership Transition: It's Not Just for the Executive, October 2011 Leadership and Performance Management, August 2011 Financial Policies and Procedures, Developing a Manual, October 2011 Thinking, Acting and Planning Strategically, March, 2011 Speak and Be Heard, Communicating as a Dynamic Leader, January 2011 Intersection of FMLA, ADA and Workers Compensation, February 2011 Wake Up Your Brand, August 2010 Using the Logic Model to Guide Program Planning and Performance Measurement, August 2010 Building Your Personnel Handbook, July 2010 Data-Driven Decisions: Organizational Dashboards, June 2010 Can You Hear Me Now? Improving Your Active Listening Skills with Donors, Board and Staff, June 2010 Lead With Ease: Facilitating Board/Committee Meetings, May 2010 Power of Collaboration, April 2010 Developing Annual Sustainability, March 2010 Selling Your Impact, March 2010 Performance Measurement for Non-Profits, March 2010 Critical Issues for Governing Boards, February 2010 Board Self-Assessment and Succession Planning, October 2009 Board/Executive Relationship, October 2009 Components of an Effective Board, September 2009

The Ottawa Story

Board Governance

Mission and Vision Bylaws and Other Governance Policies Board Role and Responsibilities Board and Committee Structure Board Culture and Group Dynamics Board Composition and

Development Meetings

Board Role and Responsibilities

Duty of CareDuty of LoyaltyDuty of Compliance[Duty to Manage Accounts]

Find your state attorney general’s website or nonprofit association website for more specifics from your state.

And then there’s the IRS

The IRS does not have official requirements for board governance… but they do have guidelines. Find them in Part VI of the 990 form.

Form 990 is a public document, often checked by donors online at www.guidestar.org.

IRS 990 Part VI Guidelines

Mission Organizational Documents Governing Body Governance and Management

Practices (next slide) Financial Statements and Form 990 Transparency and Accountability

IRS Governance and Management Policies

Executive Compensation Conflict of Interest Investments Fundraising Board Minutes and Records Document Retention/Destruction Ethics and Whistleblower Policy

Review – Role and Responsibilities

The role of director or trustee of a nonprofit board comes with legal obligations.

State corporation laws. Federal IRS guidelines. Proper governance is not optional. Board members who deliver

programming and manage the organization must still also govern.

ResourcesOhio Attorney General (Charitable Law

Section)www.ohioattorneygeneral.com

Guidestarwww.guidestar.org

Internal Revenue Servicewww.irs.gov/Charities-&-Non-profits

National Council of Nonprofitswww.councilofnonprofits.orgwww.oano.org

Governance Best Practices

There are many models of nonprofit board governance,

and standards of practice evolve over the years.

At Creative Option C, LLC we use and teach Governance as

Leadership: Reframing the Work of Nonprofit Boards by Chait, Ryan and

Taylor for BoardSource.

Modern Boards Operate in Three Modes

Fiduciary

Strategic Generative

Fiduciary Mode

Best understood, if not always embraced.

Fiscal “trusteeship” -- ensuring efficient and effective use of organizational resources.

Participation is securing resources. Also included is the guarantee of

quality programming. Necessary but not sufficient.

Strategic Mode

The art of determining the best way to get from A to B.

Should be a nonstop pattern of thinking for boards and board members.

Common pitfalls of traditional strategic planning: Plan has no traction No strategies No real input Pace of change is slow Unforeseen outcomes

Generative Mode Creative – Act of determining “A” and “B” Mission – vision - values Making sense of facts and data, defining

problems before solving them, and framing the key strategic questions.

Danger is that all information comes from staff – making board members less capable of assisting with the creative work of the organization and less effective than they could be at performing their fiduciary or strategic roles.

Finish This Sentence…

“ I wish my board would…….”

How does disengagement show itself?

Lack of attendance/quorum issues Lack of response to emails and

other communications Over-involvement in day-to-day

operations or programming Criticizing organization publicly Parking Lot Meetings

Engagement

Well-governed organizations foster an atmosphere of safety for free and open discussion.

Board members who disagree silently are unlikely to be engaged.

Disengagement is a symptom of lack of opportunity to meaningfully and easily participate in furthering an organization’s good works.

Just what should board members be engaged in?

Fiduciary Mode Budgeting and oversight Financial health and sustainability [fundraising] Evaluation

Strategic Mode Planning

Generative Mode Mission/Vision/Values Policy

[Advocacy]

Fiduciary: Budgeting and Oversight

Participation in annual budget process is key. Fiduciary obligations cannot be escaped – the

existence of a board treasurer or crackerjack staff person does not remove “duty of care” from anyone on board.

Provide a genuine opportunity for board members to shape the budget… how resources are used.

Take time to make sure all board members are truly comfortable with the financials… if they don’t understand or like your monthly statements change the statements!

Implement checks and balances and engage board members at the level of policy creation.

Fiduciary: Sustainability If a board adopts a budget that relies on

fundraising… then all members have an obligation to participate in the fundraising.

Make an effort to create an annual fundraising plan (tied to the projected need) and identify roles.

Sugarcoating or glossing over the fundraising role in recruitment, orientation, or board discussions is counterproductive.

“Give/get rules” - Create a variety of ways to participate, making use of each board member’s unique strengths.

Provide training: written materials and role-playing opportunities.

Re-evaluate regularly.

Fiduciary: Evaluation

Program EvaluationRelated to Board-Established GoalsKey Indicators/Outcome measures

CEO EvaluationRelated to Board-Established Goals

Board EvaluationHow are we doing as a group?

Generative: Mission and Vision

Mission: What do we exist to do? Vision: Where do we want to be in

five years? Ten? Values: What core beliefs and

guiding principles do we share? Co-creation of these things builds

cohesiveness. Just as valid for board discussion as

details or an event or project.

Generative: Policy

Board Governance Policies (Bylaws/Code of Regulations, etc.)

Financial Management Policies (internal controls, reporting, audit, debt tolerance, etc.)

Personnel/Volunteer Policies Communications Policies Customer Service Policies

Strategic: Planning

Not just for retreats anymore. Act of choosing priorities for the

group. Important to outline what we will

NOT be doing. Budget should follow strategic

priorities.

[Advocacy]

Nonprofits are entitled to engage in issue-based advocacy, including lobbying.

Limitations on amount of budget that can be used to lobby (usually 3% but up to 20% with specific application to IRS.)

For more information: Alliance for Justice, www.bolderadvocacy.org

Getting from Here to There

Strategy 1: Invest Time in Recruitment and Orientation

Make sure each board prospect knows what you value about them.

Recruit people who are self-motivated. Board member position description

Spell out expectations Provide new board members with:

Materials (minutes, financials, policies, etc.) Time to introduce themselves Space to ask questions

Board Composition and Development

Strong CEO’s want strong boards (strong refuge managers should want them too!)

A board should be well-rounded for skills, experience, and connections needed for the organization’s unique purpose.

Diversity in age, gender, race, geography, economics, stakeholder interests.

Commitment to organization – willing to govern (take care of the golden goose)

All important roles covered – filling gaps is a priority.

Recruitment MatrixBoard

ServiceSocial Media

Grant-Writing

Knows birds

Bob X X

Sue

Mary X X

Joe X X X

Beth X

Board Orientation Board-led. Dovetails with recruitment. Talk about culture and expectations. Include printed materials.

Articles of Incorporation/501-c-3 letter Bylaws and other policies Budget/Financials Strategic Plan Board roster/matrix Minutes of previous meetings Program information

Strategy 2: Conduct a Board Self-Evaluation

Several tools exist Group Individual Board Member

Provides “speaking” opportunity for board members who are ordinarily quiet in meetings

Allows board members to self-identify and therefore own or buy-in to problems

Strategy 3: Use Principles of Change Management

Putting the board on a path to take care of its infrastructure is usually an exercise in change management… Here are author John Kotter’s Eight Principles for Change: Increase urgency Build the guiding coalition Get the vision right Communicate for buy-in Empower action Create short-term wins Keep at it Make change stick

Strategy 4: Find a Board Ally or Partner

Board Chair/CEO relationship is critical Volunteer Committee Chair Governance Committee Chair Any member who surfaces a concern

to you Must have a high level of trust Follow their lead!

Strategy 5:Separate Ends and Means

An effectively-operating board is not an end in and of itself, but rather a means for achieving some end

What is the purpose? What could we achieve with more board involvement? What is our mission?

See change management principle #1 (increase urgency)

Strategy 6: Form a Governance Committee

It’s not just about “nominations” anymore Good role for vice president Responsible for board development

activities, including orientation, annual retreat, ongoing training and mentoring

Conducts assessments, communications with board members about their board experiences

Reports to chair, executive director, and/or board about emerging issues

Strategy 7:Conduct Strategic Planning

Include assessment of where we are now Create legitimate opportunity for full-

board participation. Predetermining the outcome and guiding others to the “right” conclusion will backfire!

Include “institutional” goals related to board, staffing, space, budget, etc.

Include action plan outlining who is responsible for what by when.

When identifying champions, try not to say “board.” That gives each one an opportunity to wait for others to do it.

Strategy 8: Find Your Balance

Rubberstamping vs. Micromanaging Board members who actually have a role in

deciding the priorities for using resources (i.e. planning and budgeting) are easier to engage in governance – and in fundraising.

Take time to make sure all board members are truly comfortable with the financials…

It’s more important to have a good discussion than to end the meeting on time (really)

Include board members between meetings – take them to lunch, seek their advice, and listen!

Strategy 9: Step Back!

Strong leaders create disengagement. They spoil people.

Trusting others to do things well is easier than doing it yourself.

Competent people are often hard to challenge or even advise.

Subtlety doesn’t work: feedback must be clear and direct.

Strategy 10: Learn More

Classes Joint events with other boards Books Websites Blogs Social media: LinkedIn, Facebook

ResourcesCenter for Nonprofit Resourceswww.c4npr.org

Board Café/Compasspointwww.compasspoint.org

BoardSourcewww.BoardSource.org

Blue Avocadowww.blueavocado.org

And last but not least…

Call NWRA!Joan Patterson

Director of Grassroots Outreach1001 Connecticut Ave NW, Suite 905

Washington, D.C. 20036202-290-5594

jpatterson@refugeassociation.org

www.refugefriendsconnect.org

Let’s Stay in TouchCathy Allen

Creative Option C, LLCcathy@CreativeOptionC.com

419-732-1770www.CreativeOptionC.com

www.Facebook.com/CreativeOptionC