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Building an Effective Board

of DirectorsAFP’S READY REFERENCE SERIES

RECRUITING

FUNDRAISING

DEMOGRAPHICS

PERFORMANCE

VISION

THE ASSOCIATION OFFUNDRAISING PROFESSIONALS

(AFP)

WHO WE ARE:AFP, an association of professionals throughout theworld, advances philanthropy by enabling people andorganizations to practice ethical and effectivefundraising.

The core activities through which AFP fulfills thismission include education, training, mentoring,research, credentialing and advocacy.

AFP members abide by the highest ethical standardsin the fundraising profession and are required to signannually the Code of Ethical Principles and Standardsof Professional Practice.

OUR VISION STATEMENT:AFP will be the recognized leader in the promotion ofphilanthropy by empowering fundraisers to servehumankind throughout the world.

To purchase additional copies, contact AFP at (800) 666-3863 or email [email protected].

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U.S. and Canada: (800) 666-3863Mexico: 001+(866) 837-1948

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Building an EffectiveBoard of Directors

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AFP’s Ready Reference SeriesAssociation of Fundraising Professionals

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This booklet is the fifth in AFP's Ready Reference Series for professionalfundraisers.

Text by Linda Lysakowski, ACFRE.

©2004 by the Association of Fundraising Professionals (AFP), 1101 KingStreet, Suite 700, Alexandria, VA 22314.

All rights reserved. No part of this publication may be reproduced, storedin a retrieval system or transmitted, in any form or by any means—elec-tronic, mechanical, photocopying, recording or otherwise—without theprior written permission of the publisher. Printed in the United States ofAmerica.


Table of Contents

Assessing the Makeup and Performance of the Board ................ 1

Identifying and Recruiting Board Members .................................. 8

Involving the Board in Fundraising.............................................. 18

Building an Even Better Board ...................................................... 26

Appendices

A: Board of Directors Self Evaluation .......................................... 37

B: Board of Directors Individual Evaluation .............................. 39

C: Board Fundraising Assessment ................................................ 40

D: Board Member Interest Assessment ........................................ 42

E: Board Members Performance Evaluation................................ 43

F: General Board Checklist ............................................................ 44

Resources

AFP Code of Ethical Principles and Standards of Professional Practice................................................ 46

A Donor Bill of Rights .............................................. inside back cover



T he role of the board in governing a non-profit organization cannot be overestimat-ed. The board makes the difference

between a good nonprofit and a great one, andcan even make or break an organization. Boardsare like parents: they need to support, encourageand inspire greatness in their “child” if the organi-zation is to survive and thrive. What happenswhen the board does not understand its role orembrace it? The nonprofit becomes an “orphan,”unable to secure sufficient funding, attract com-mitted staff and enthusiastic volunteers or reachits potential as a service provider.

Nonprofits often miss key steps at the begin-ning. First, they must establish a way for theboard to evaluate regularly its performance, bothcollectively and individually. Second they need aplan for improving leadership performance sothat the board becomes visionary and the organi-zation successful.

To begin building an effective board of directors andto see where your organization is presently, first takea close look at the current board’s demographics.Using a grid like the one on the following page is agood tool for examining the demographic makeupof your board, but you can start assessing theboard’s composition simply by asking a few ques-tions:

■■ Does the board’s ethnic mix represent thecommunity it serves?

Assessing the Makeup and Performance of the Board

1

MappingDemographics


Building an Effective Board of Directors

2

[revision date]

SAMPLE BOARD OVERVIEWBoard Member Names

Term expires Term expires Term expires20 ____ 20 ____ 20 ____

DemographicsMaleFemale21-30 years31-40 years41-50 years51-60 years61-70 yearsMore than 71 years

EthnicityAfrican-AmericanAsianCaucasianLatinoOther

Giving PotentialHighMediumLow

Expertise inLegal IssuesPersonnel ManagementFinancial ManagementFundraising Public/Community RelationsPlanning/OrganizingOrganization’s Service Area

Influence withPower GroupBusiness/Financial Community Ethnic/Minority GroupsMediaGovernment

Adapted from Building a Better Board: A Guide to Effective Leadership by Andrew Swanson, © TheTaft Group, 1984, 1-800-877-TAFT.


3


■■ Is there gender diversity, a good mix ofmales and females?

■■ What about age diversity—are all genera-tions represented?

■■ Is the board geographically diverse?

■■ What other groups are important to theorganization and should be represented onthe board?

An organization that does not have a boardwith a broad demographic mix may suffer in anumber of ways. When considering grantrequests, some funding sources will likely passover a nonprofit that does not have a board thatadequately reflects its community. Boards that aregender exclusive or limited in age range often losevaluable differing perspectives. Geographic diver-sity also is important, especially for organizationsthat serve a wide geographic scope or encompass-es rural and urban communities. Depending onthe nonprofit’s mission, people with disabilitiesor differing religions or political views might beimportant in an organization’s governance.

A word of caution when looking at diversityissues: people should never be invited to serve onthe board just because they are a specific age, raceor religion. An overall assessment of the boardwill help determine if you have any pertinentdiversity gaps, but an organization should not fillvacant slots with people solely because they fit acertain demographic profile.

Having youth serve on boards is aparticularly sticky issue, even for chari-ties serving this age group. Rememberthat the board of directors has a fiduci-ary responsibility for the organization,so you should consider the legal ramifi-cations before including on your boardthose who have not reached the age ofmajority. A youth advisory council may

ARE THEY QUALIFIED?When aiming for diversity

on your board, don’t let demo-graphics be the only factor youconsider. Above all, your boardmembers must be leadershipmaterial.


serve the purpose of getting input from youthwithout giving them a policy-making position onthe board.

The next step is to assess the skills and talents of theboard. Using the board overview grid, list the quali-ties of the current board. Some typical skills neededby almost every nonprofit are:

■■ Legal expertise

■■ Financial management/accounting expert-ise

■■ Marketing skills

■■ Fundraising ability

■■ Program expertise specific to the organiza-tion

■■ Long-range planning skills

■■ Good communication skills

■■ The ability to lead

■■ The ability to govern

In addition, it will be helpful to have peopleon the board with connections such as:

■■ Access to foundations, corporations andindividual philanthropists

■■ Media contacts

■■ Political contacts

■■ Contacts with professional and serviceorganizations

4


Tallying Skills andTalents

BOARD CLOUT

When recruiting new board members, go beyond making alist of skills needed for organizational tasks. Board membersshould not only lend their expertise but give entree into areas ofinfluence for fundraising and marketing possibilities.


5


SAMPLE BOARD MEMBER PROFILE

Name Term Expires

Home Address

Employer

Title

Business Address

Business Phone

Email Address

Preferred Mailing Address � Home � Business

Personal Information:

Birthday (M/D) Spouse

Children

Professional Affiliations:

Community Activities - other nonprofit boards and committees:

Other Interests:

Committee Preference

� Development � Program � Finance � Planning

� Board Resource � Special Events � Marketing � Other

Please attach background information or résumé, if available andB&W photograph, (résumé preferred).

Please return to:


Before recruiting people to serve on theboard, an organization needs to have a résuméand a profile sheet completed by each potentialboard member. The profile sheet should includetheir contacts and areas of influence, such as pro-fessional clubs and community activities. (See pre-vious page for the sample board member profile.)

While most boards recognize that one of theirresponsibilities is to do an annual review of theorganization’s CEO, they often overlook an equallycritical duty: evaluating their own performance. Thisannual task can easily be overseen by either the exec-utive committee or the board resources or gover-nance committee. (The function of the boardresources or governance committee is covered in thenext chapter.)

First, all board members will be asked to eval-uate themselves and their peers individually andthen assess the performance of the board as awhole. Then, the committee overseeing the taskshould hold a special meeting with the executivedirector to review the evaluations. This finalreview could be held in conjunction with theannual executive committee meeting, perhaps theevening before the board’s annual retreat. Resultscould be shared the next day with the entireboard.

Some forms for evaluating board perform-ance are found in the appendices. Organizationscan use any or all of these forms to help assessboard performance as a whole and performanceof individual members. It is important to look atboth aspects before identifying potential newboard members.

Is Your BoardDoing Its Job?

6




7

A CLOSER LOOK AT YOUR BOARD MEMBERS

To get a clear picture of how your board as a whole is functioning, you needto look closely at the members. An honest evaluation of your individual boarddirectors is needed to understand how well the group is leading your nonprofitorganization. Some questions board members should ask themselves include:

■ Do I attend meetings regularly and participate in discussion at these meet-ings?

■ Am I informed about the mission and vision of the organization and do Isupport this mission and vision?

■ Do I contribute my time and money to this organization to the best of myability?

■ Do I serve on committees and task forces when invited?

■ Do I encourage others to support this organization and serve as aspokesperson when asked?


8

Identifying and RecruitingBoard Members

O ne of the best pieces of advice for anynonprofit to follow is to get rid of itsnominating committee. For most organ-

izations, the nominating committee has two pri-mary functions: to fill vacant board seats and toelect officers of the board. But the nominatingcommittee frequently is an ad hoc committeeappointed by the president or chair just a fewmonths before terms are due to expire. Often bythe time the committee is appointed, most boardmembers are busy with other committees, and thenominating task falls to someone who has notbeen involved in other board work and may not beaware of the strengths, weaknesses and needs ofthe board.

Instead of a nominating committee, one rec-ommended approach is to have an ongoing boardresources committee. This committee, sometimescalled the governance committee or the commit-tee on directorship, should have the followingtraits:

■■ It should meet year round;

■■ It needs to be chaired by the strongest per-son on the board and comprised of onlyboard members;

■■ Its duties include doing an assessment ofboard performance—collectively and indi-vidually;

■■ It is responsible for developing or refiningboard position descriptions;

■■ It evaluates the needs of the board and

Who Recruits?The BoardResourcesCommittee


9


develops a profile of the kinds of peoplethat are needed to fill vacancies;

■■ It works with the board to help find theright people to fill board positions;

■■ It ensures diversity on the board;

■■ It implements, along with the organiza-tion’s senior staff members, board orienta-tion;

■■ It is responsible for ongoing education ofthe board.

Perhaps the most important committee of all, theboard resources committee should not be treatedas an afterthought.

Once in place, the board resources committeeshould first complete the board grid (see page2), analyzing strengths and weaknesses of thecurrent board. Using the grid, the committeeshould organize board members according toclasses (the year their terms expire) and markdiversity indicators, such as ethnicity, genderand geographic location. Skills, talents andareas of special expertise also should be listed,along with giving ability and contacts withvarious groups such as media, funders andgovernment agencies. Once this grid is complete,the committee can then determine where gaps liein board diversity, skills and abilities. A profile ofskills, qualities and demographics can then bedeveloped for recruiting new board members.

It is important that the board resources com-mittee meets on a year-round basis and evaluatesproblem issues that arise with the board or indi-vidual directors. Ongoing board education is alsoa responsibility of this committee and can greatlyimprove the board’s effectiveness. For example, ina human service agency, this committee mightarrange for case workers to make presentations ata board meeting. Or the curator of fine arts might

ONGOINGDEVELOPMENT

Board developmentneeds to be a year-roundactivity for boards–andtheir organizations–toachieve the greatesteffectiveness.


provide seminars for museum board members.The board resources committee should evaluatethe need for board education and work with theexecutive director to provide the appropriate edu-cational segments at board meetings or retreats.

A board resources committee, workingthoughtfully, diligently and regularly can make allthe difference between an effective, enthusiasticand inspired board and a lackadaisical board thatdoes not understand its role in advancing an orga-nization’s mission.

Cultivating strong board committees is a valuableresource for developing leadership within the organ-ization. With the exception of the board resourcescommittee, which oversees internal issues, commit-tees should be composed of both board and non-board members. Many organizations have success-fully turned a weak, ineffective board into a skilledand committed one over time by recruiting excellentcommittee members as future directors.

While committee structures will vary fromorganization to organization, there are some stan-dard committees that every nonprofit should haveon its board. In addition to the board resourcescommittee, at the very least a small organizationshould have an executive committee, a financecommittee, and a program committee. Otherimportant committees include fundraising/devel-opment, public relations, and strategic planning.

The executive committee generally consists ofall the officers of the board; sometimes chairs ofstanding committees are included. The executivecommittee is often given power from the fullboard to make important decisions betweenboard meetings. This committee is usually respon-sible for evaluating the executive director and, inthe absence of a planning committee, may alsoinitiate strategic planning. In smaller organiza-tions this committee may fill several other roles

10


Thinking Ahead:CultivatingCommittees


11


such as personnel, finance and audit committees.

The finance committee oversees all budgetaryissues. This committee also usually engages theauditors for the organization and reviews theannual audit before it goes to the full board. It isimportant to have several people on the financecommittee who understand financial statementsand can help with investments.

Program committee functions will varydepending on the organization, with some non-profits having multiple committees overseeingvarious programs. This committee(s) will workwith program staff to develop new programopportunities, monitor program performance andsuggest improvements.

ExecutiveCommittee

Secretary

Treasurer Finance Committee

DevelopmentCommittee

MarketingCommittee

Program Committee

Planning Committee

Board ResourcesCommittee

Chair

Vice Chair

SAMPLE BOARD ORGANIZATIONAL CHART


In addition to providing a resource of futureboard directors, involving non-board members incommittee work gives the organization new talentand contacts it may be lacking on the board. Theone committee that particularly benefits fromnon-board volunteers is the development commit-tee, which is covered in the next chapter. Whenfundraising time comes, the organization willhave opened up a realm of contacts through itsnon-board volunteers beyond those of currentdirectors.

To find the best committee volunteers, firstassess a committee’s needs and then ask yourboard and staff for suggestions. A great resourcefor leads is any civic leadership program yourtown may sponsor to train mid-level managers forcommunity service leadership. Local chambers of

12


COMMITTED TO COMMITTEES

Most nonprofits accomplish their leadership work through board-appointed-committees, made up of a combination of board members and other volunteers.The committees that every organization should have in place include:

■ Board resource committee

■ Development committee (fundraising)

■ Executive committee

■ Finance committee

■ Program committee(s)

■ Public relations committee

■ Strategic planning committee (may be an ad hoc committee)

The needs of a particular organization will determine the names and func-tions of committees and what additional committees are required. For example,an organization that has a large staff may have a personnel committee, whilenonprofits that have a wide range of programming may have several programcommittees. In smaller organizations, sometimes the executive committee handlesthe planning and finance functions. Nonprofits with complicated financial struc-tures may have a separate budget committee and an audit committee.


13


The BoardPositionDescription

commerce are also a good source for volunteercommittee members. Many communities alsohave a volunteer center that may be able to helpmatch volunteers with nonprofit organizations.

Before recruiting anyone for a board or committeeposition, position descriptions must be in place.People will want to see in writing what is expected ofthem before they make a commitment. This is animportant task for the board resources committeeand should be completed before any recruiting isdone.

The position description should include astatement of the purpose of the board, boardterm limits, roles and responsibilities, and arequirement to sign a conflict of interest state-ment. A sample board position description can befound on the next page. Additional positiondescriptions are available from the Association ofFundraising Professionals (AFP) Resource Center(phone (800) 688-FIND or [email protected].)

After the board assessment is completed, the boardresources committee submits the results to the fullboard and asks for suggestions of potential direc-tors. Names and résumés are given to the boardresources committee for consideration. Individual

YOUR FUTURE DIRECTORS

Committee work is an excellent proving ground for future board members.Serving on committees gives volunteers a chance to “try out” an organization tosee if they want to become more involved. It also gives the organization an oppor-tunity to see which volunteers are committed, enthusiastic and skilled in theareas needed on the board. Often committee members can move into board posi-tions after demonstrating their commitment and skills to the organization. Theywill also be familiar enough with the “corporate personality” to know if servingon the board will be a good fit for them.

Recruiting NewDirectors


SAMPLE BOARD POSITION DESCRIPTION

PPuurrppoossee:: To act as a voting member of the board with full authority and responsibili-ty to develop policies for the operation of the organization; to monitor the organiza-tion’s financial health, programs and overall performance; and to provide the chiefexecutive officer the resources needed to serve the organization’s constituencies.

TThhee FFuullll BBooaarrdd’’ss RReessppoonnssiibbiilliittiieess::■ Establish policy ■ Hire and evaluate the executive director ■ Secure adequate funding for the organization ■ Monitor finances ■ Create and update a long-range plan for the organization ■ Select and support the organization’s board officers ■ Adopt key operating policies; approve contracts as appropriate

IInnddiivviidduuaall BBooaarrdd MMeemmbbeerr’’ss DDuuttiieess::■ Attend board meetings regularly■ Become knowledgeable about the organization ■ Come to board meetings prepared and informed about agenda issues ■ Contribute to meetings by expressing a point of view ■ Consider other points of view, make constructive suggestions and help the

board make decisions that benefit the organization’s constituencies ■ Serve on at least one committee ■ Represent the organization to individuals, the public and other organizations in

a positive and professional manner ■ Support the organization through attendance at special events and activities

and through meaningful financial contributions■ Assume board leadership roles when asked ■ Keep the executive director informed of relevant community concerns ■ Maintain confidentiality of board discussion

RRaattiioonnaallee:: Board members set corporate policies and goals and delegate authority tothe executive director to implement such policies and goals in the day-to-day manage-ment of the organization. Individual members of the board, however, have no authori-ty to act independently of the full board on policy issues. Board members who abusetheir position this way may be disciplined or censured.

Board members are also trustees of the organization who approve an annualbudget that ensures it can meet its financial needs. In addition, board members moni-tor the overall financial health of their organization by reviewing annual reports of anauditor recommended by the executive director. The executive director retains responsi-bility for day-to-day operational expenditures.

IInnddiivviidduuaall bbooaarrdd mmeemmbbeerrss sshhoouulldd aatttteenndd aallll bbooaarrdd mmeeeettiinnggss aanndd aaccttiivveellyy ppaarr--ttiicciippaattee iinn tthheemm aanndd sseerrvvee oonn ccoommmmiitttteeeess aanndd//oorr aass bbooaarrdd ooffffiicceerrss.. BBooaarrddmmeemmbbeerrss hhaavvee tthhee rreessppoonnssiibbiilliittyy ttoo kknnooww aanndd ffuullffiillll tthheeiirr rroollee iinn tthhee oorrggaanniizzaa--ttiioonn aanndd ttoo aacctt iinn tthhee bbeesstt iinntteerreesstt ooff iittss ccoonnssttiittuueenncciieess..

Sample Board Position Description reprinted with permission of Aspen Publishers, from Board JobDescriptions, Members of the Board, ISBN# 0-8342-0413-4, © Aspen Publishers Inc., 1993.


15


board members should never recruit new boarddirectors on their own nor assume those they nomi-nate or interview will automatically be asked to serveon the board. Inviting candidates to serve is the jobof the board resources committee.

Matching résumés to board needs, the boardresources committee compiles a “short list” ofpotential candidates. This recruiting list is thenresubmitted to the full board for approval beforeany official recruiting is done in case a directorhas relevant information about any of the candi-dates that would affect the nomination eitherpositively or negatively.

When meeting with board candidates, thecommittee should give the potential directors aboard recruitment packet. This packet shouldinclude the position descrip-tion for board members,along with pertinent informa-tion about the organization—the bylaws, a list of boardmembers, a list of board meet-ing dates, the budget, thestrategic plan, conflict ofinterest statement, brochures,program descriptions and soforth. This packet should begiven early in the recruiting process, not at boardorientation, so the prospective board member canmake an informed decision about serving on theboard.

When the board resources committee inter-views the prospective board members, the execu-tive director should participate in these meetings.The interview should include an overview of theboard position description and expectations ofthe organization. The candidate also should beasked to share his or her own expectations, inter-est in the organization and understanding ofboard requirements. These interviews should clar-

PACKET PUNCH

Just as your brochures, website andadvertising markets your organization, sodoes your board recruitment packet. Notonly should the packet inform a candidateof the facts of your organization, but itshould do so in a winning style, conveyingthe nonprofit’s values and personality.


ify if the candidates are really committed to beinggood board members or if they only have theirown interests in mind.

Once the board resources committee has nar-rowed down the list to a firm slate of candidates,final recommendations are submitted to the full

board for approval. After the boardelects the new board members, thecommittee invites them to join theboard and attend the next board meet-ing. The committee is also responsiblefor providing orientation for new boardmembers. Additionally, the boardresources committee submits recom-mendations for board officers to the

full board for election. And, the same thoughtfulprocess that goes into recruiting new board mem-bers should go into the board officer selection.

When new board members are brought into theorganization, it is important to hold board orienta-tion for the new “class” of board members. Staff andboard will plan the orientation for these new boardmembers. While the new board member will alreadybe very familiar with the organization through therecruitment process, any additional information canbe given during orientation.

For your orientation, you might include atour of facilities or a “virtual tour” of programs,both of which are good ways to help new boardmembers understand a nonprofit’s mission andprograms. A more senior member of the board,usually the board chair, can then talk about thevision of the organization, where it is headed andhow the board is involved in creating, refiningand fulfilling the mission.

Development staff and senior program staffalso should attend new board member orientationand give a brief explanation of their work. If thereis a chief financial officer in the organization, that

16


Board Orientation

A BOARD NO-NO

Inviting someone to serve on theboard is the sole responsibility of the boardresources committee. While other boardmembers might be involved in recruiting,they should leave the final analysis to thecommittee.


17


person should participate in the orientation toexplain budgets and financial statements.

Another effective way to ensure involvementof new board members is to assign them a mentor—a more senior board member who will beresponsible for reminding them of meetings, get-ting them involved in committee work andanswering any questions they may have about thework of the board. All boardmembers should be assignedto a committee or task forceas soon as they are broughtonto the board. More mem-bers leave boards becausethey feel unneeded thanthose who leave because theyare asked to do too much. Setboundaries for the number ofhours board members are expected to give. This isoften outlined in the position description so thenew board members will know before agreeing toserve on the board how much of a time commit-ment is involved.

Board orientation is also a good time for thenew board members to get to know each other.Time should be allotted for introductions at theorientation and at the first meeting of the fullboard attended by new board members.

MORE THAN A FORMALITY

By the end of orientation, your newboard members should feel a part of theorganization and begin to own the mission.Don’t miss the chance to get them involvedimmediately–have them sign up for com-mittees and projects at orientation.


Involving the Board inFundraising

18

T he development committee leads theboard’s fundraising program. This com-mittee, staffed by the senior development

officer, will develop the long-range plan andannual work plan for the development program;assist with the process of identifying, cultivatingand soliciting donors; and lead the board’s givingprogram. Having a plan approved by the develop-ment committee will assure that the board willnot get sidetracked with events and activitiesextraneous to the plan.

Often the development committee is dividedinto subcommittees such as special events,planned giving, annual giving and board appeal. Ifthe organization covers a large geographic area, itmay be wise to have regional development com-mittees that work independently and meet togeth-er once or twice a year to share ideas and ensurethat each is working within the unified develop-ment plan.

Sometimes, if there is not a separate commit-tee to fill this role, the development committeealso manages the public relations function. Publicrelations is closely tied to development and thecommittees should have a close working relation-ship if they are separate.

Like board members, the members of thedevelopment committee should be carefullyselected and given a full description of expecta-tions before they agree to serve on the committee.Time commitments and a requirement to supportthe organization financially should be part of thisand other committee position descriptions.

The DevelopmentCommittee


19


Finding members for the development com-mittee and other committees is often easier thanfinding board members because there are manypeople who may not be ready to accept the fiduci-ary responsibility of a board member but want toget involved with the organization. (see the previ-ous chapter for more information about usingthe committee structure to identify potentialboard members.)

For a good resource for potential develop-ment committee members, turn to bankers,financial planners, attorneys and entrepreneurs.Look for people who have served on boards ordevelopment committees of other organizations.

Recruiting development professionals fromother institutions, providing the organizationsare not direct competitors, may be helpful. Beaware, however, that in general this developmentprofessional may not be able to help you actively

DEVELOPMENT COMMITTEE TASKS

■ Work with appropriate staff to develop a long-range and short-range development plan.

■ Plan and oversee all fundraising activities of the organization.

■ Contribute financially to the organization and ensure full board participation in all campaigns and projects.

■ Identify and recruit leadership and volunteers for development activities.

■ Educate the full board on the theory and techniques of development programs.

■ Encourage the participation of all board members in fund-raising activities and programs.

■ Attend all fundraising events and encourage board members' attendance.

■ Work with or assume the duties of the public relations committee.


Gather, Get Readyand Grow

solicit donors because it could be a conflict ofinterest, but could be helpful in planning, writing,identifying donors, or with other fundraisingtasks. For example, a development officer from auniversity may be a good person to add to thedevelopment committee for a human serviceagency, whose programs and donors will mostlikely be very different than those of an educa-tional institution.

The motto “Give, Get or Get Off!” has been tradi-tional wisdom for board giving, but a new modelthat you may want to consider is “Gather, GetReady and Grow.” Using the Gather, Get Ready andGrow model, any board can be a fundraising board.

■■ Gather—the first step is to bring the boardto consensus that fundraising is a boardresponsibility.

■■ Get Ready—the next step is to prepare theboard for fundraising.

■■ Grow—the last step is the board thenimplementing the development plan, thenwatching donors and contributions grow.

Board giving should always be a requirementfor any nonprofit. If the board does not supportthe organization financially, the staff will havedifficulty convincing potential donors to supportit, and it will be impossible for board members toask for others to give. Many funders require 100percent board giving before considering a requestfor funding from an organization. For manysmaller nonprofits, the board may not be filledwith people of affluence, but the size of their giftsis not always what matters. The factors fundersoften consider are that 1) 100 percent of theboard has made a financial commitment and 2)each board member has made a meaningful gift.

As is often said, board giving requires equal

20



21


sacrifice, not equal giving. For this reason, yourboard position description should not list a spe-cific amount for an annual board gift. Two prob-lems arise with requiring a specified amount. Forexample, an organization might suggest an annu-al gift of 1,000 per board member. The first prob-lem the nonprofit may face is that such a giftwould rule out some wonderful board members;not everyone may be able to contribute $1,000 ayear to the organization. The second issue is thatthe nonprofit has unwittingly limited giving fromits board. Some directors may well afford to givefar more than $1,000 a year, but will tend to givethe minimum amount and no more since that iswhat you have said the organization needed.

A basic starting point is getting board consensusthat fundraising is a priority. If one or several per-sons on the board understand the board’s fundrais-ing role, they should be the core of the fundraisingor development committee. If nobody on the boardunderstands that fundraising is a priority for theorganization, you may need to bring in an outsideconsultant or a board member from another non-profit to help educate the board on its developmentresponsibilities.

For some organizations with dysfunctionalboards, this education process may take severalyears and require a complete turnover of boardmembers. However, even if accepting developmentresponsibility happens gradually, it will be worthit to the organization. Those boards that areactive in fundraising become visionary and canlead a nonprofit to its next level.

Once the board accepts responsibility forfundraising, the next step is to have board mem-bers put their money where their heart is. Theannual board appeal should be the first fundrais-ing activity of the fiscal year. Before asking anyoneelse to support the organization, the board needs

Vision forFundraising andthe Board Appeal


to show its full commitment. The board appeal isconducted much the same as any other fundrais-ing appeal.

■■ Recruit a solicitation team from theboard—usually the board chair and thedevelopment committee.

■■ The solicitation team evaluates each boardmember’s past giving and giving potential.

■■ Assign an ask amount and a solicitor toeach board member.

■■ Using this initial evaluation, the team,together with the board, sets a boardappeal goal.

■■ The board chair writes a letter to eachdirector, stressing the goal of 100 percentgiving.

■■ Finally, as with any major donor, the ask ismade in person so that every board mem-ber understands the importance of thisappeal.

Once the board appeal is complete, it is time to pre-pare the board for talking to others about support-ing the organization. If the charity already has apool of donors, this external fundraising will be a lit-tle easier. If not, the first step is to do some brain-storming about potential donors. Many organiza-tions ask their board members to submit a list of tenor fifteen people they think would support theorganization; however, few ever complete this task.Instead, schedule a brainstorming session and pro-vide tools to help spark ideas of potential donors.Give them a form such as on page 24 to help gener-ate donor leads.

If you don’t have such a donor list already,then the names provided by the board will be yourstarting point for prospects. If you already have a

22


Cultivating Donors


23


pool of donors or prospects, so much the better.The names generated by the board can be addedto your internal list.

Regardless of the source of the names, someresearch will be needed to refine this list into atrue prospect list. A staff person should review or“massage” the list, making sure there are noduplicates and adding any new information theorganization may have about prospects. Some ofthe data you will want to track are:

■■ past giving history to the organization

■■ known gifts to other organizations in thecommunity

■■ personal interest shown in programs orprojects

■■ estimate of giving ability.

Then the board will review this list and fur-ther refine it, adding any other information theyknow, including whether or not they know theprospect, would be comfortable asking for a dona-tion, or who they would recommend from theboard to make a request.

Once your list is complete, have board mem-bers select five donors whom they will ask for acontribution. It is important not to ask boardmembers to “bite off more than they can chew.”Five fundraising calls are aboutall most people can manage ata given time. Once those fivecalls are completed, then theycan select new names. Alsosome people feel more comfort-able calling on strangers than acquaintances, sothis preference should be honored. However, anadage of successful fundraising is that “peoplegive to people,” so explain to your board membersthat their chances of success are better when call-ing prospects they know.

FRIEND-RAISING

Statistics show that fundraisers askingpeople they know for a donation generatesmore gifts than making cold calls.


POTENTIAL DONOR LISTYour Name

category name/address major gift I willppotential? contact

AccountantBankersAttorneysMembers of my professional associationInsurance agentDoctorsDentistCar dealerMembers of my service club

Neighbors

Relatives

Clients/customersPoliticiansFellow worshipersCo-workers/colleagues

Fellow alumni

Parents of my children’s friendsRealtorAthletic club members

People who support other charitiesPeople who’ve asked me to support a charityVolunteers of nonprofits

Others

24



25


The final step in preparing the board to dofundraising is to train them in fundraising theoryand techniques. Again, a consultant can bebrought in for training, or a director or staffmember from an organization successful infundraising can inspire with their most effectivestrategies. Other resources that are available arebooks, tapes, videos and workshops in solicitationtechniques. Board members, even if they havebeen involved in fundraising for other organiza-tions, need to be given materials specific to yourcharity to be successful. Being equipped with theright training and written materials, such asbrochures, fact sheets and pledge cards, combinedwith a compelling case for support, will help takethe fear out of fundraising for your board andother fundraising volunteers.


26

Casting a Vision B efore the board can be successful atfundraising, or even at governing theorganization, the members must buy into

the mission of the organization and be fully com-mitted to it. The board is responsible for develop-ing, reviewing, refining, and adjusting (if neces-sary) the mission statement of the organization.

Boards should periodically go through a fullstrategic planning process in which the mission,vision and values will be reviewed (or developed ifthey are not already in place).

The strategic planning process can be an ener-gizing and exciting one, or it can be a chore if notdone properly. Having an outside facilitator toguide the organization through strategic planningcan ease this process, enabling the board membersand key staff to participate fully without beingconcerned about running the meetings. An ad hoccommittee should be appointed to select the facil-itator, establish a timeline and develop a list ofdesired outcomes. This committee will work withthe facilitator to conduct the needed backgroundresearch, schedule a planning session and othermeetings that may be needed, and ensure involve-ment of all the key staff and board members.

Involving both board and staff in the plan-ning process is critical. The board will notapprove a plan in which they have not providedinput. Likewise, it will be almost impossible to getstaff to implement a plan if they have not beeninvolved in its development.

Building an Even BetterBoard


27


A board retreat should be scheduled annually. Aboard needs time together outside of a routineboard meeting to plan new ventures, reflect on suc-cesses and failures and develop strategies for thefuture. A retreat is often the culmination or thebeginning of the strategic planning process.

Scheduling a day-long or a weekend retreatwill give the board an opportunity to spend sometime socializing as well as working. It is best toget away from the organization’s facility to mini-mize interruptions, and if possible try to select alocation with a relaxing or educational atmos-phere—a museum, an environmental center or aresort.

All board members and key staff should beexpected to participate in the annual retreat.Scheduling the retreat with sufficient advancenotice will help ensure full participation. If anannual retreat is part of the board expectations, itshould be listed on the board position descriptionand discussed with new board members.

Using an outside facilitator to lead yourretreat can be beneficial, bringing in fresh ideasand expertise, or featuring a motivational speakerat the opening session can help energize a boardto think in a new direction. If the budget does notpermit hiring a paid consultant, a less expensivefacilitator might be available from the UnitedWay or a local college or university. Or, an execu-tive director or board member from another non-profit organization is another possibility.Sometimes local businesses may offer the servicesof one of their executives for nonprofit strategymeetings or retreats.

Regular business should not be conducted atthe retreat. Rather this time should be used todiscuss larger, strategic issues such as vision-cast-ing, developing a mission or values statement,building the case for support or examining new

Board Retreats


program opportunities. Opening the retreat withan icebreaker exercise is a good way to warm upboard members and get them talking amongthemselves.

While there are no official votes or minutestaken at a retreat, you should record importantdecisions for follow-up. Soon after the retreat, awritten report with action steps to be takenshould be sent to everyone who participated inthe retreat and those unable to attend.

For an organization to be effective, the board needsto know what its responsibilities are in governingand leading, and how these differ from the staff ’sduties in managing. The organization will suffer ifthe board members try to micro-manage the organi-zation. The following list shows some typical roles ofboard and staff and what roles are done jointly.

Role Play: WhoDoes What?

28


GOVERN OR MANAGE?AAccttiivviittyy

PPLLAANNNNIINNGG::Direct the process of planningProvide input to long-range goalsApprove long-range goalsFormulate annual objectivesApprove annual objectivesPrepare performance reports on achievement

of goals and objectivesMonitor achievement of goals and objectives

PPRROOGGRRAAMMMMIINNGG:: Assess stakeholder needs (constituency) Train volunteer leadersOversee evaluation of products, services and

programsMaintain program records; prepare reports

PPaarrttyy

StaffJointBoardStaffBoardStaff

Joint

JointJointJoint

Staff


29


GOVERN OR MANAGE?AAccttiivviittyy

FFUUNNDDRRAAIISSIINNGG AANNDD FFIINNAANNCCEE::Prepare preliminary budgetFinalize and approve budgetEnsure that expenditures are within budget Solicit contributions in fundraising campaignsOrganize fundraising campaignsApprove expenditures outside authorized budgetEnsure annual audit of organization accounts

PPEERRSSOONNNNEELL::Employ chief executiveDirect work of the staffHire and discharge staff membersMake decisions to add staffSettle discord among staff

CCOOMMMMUUNNIITTYY RREELLAATTIIOONNSS::Interpret organization to communityWrite news storiesServe as liaison to other organizations

BBOOAARRDD CCOOMMMMIITTTTEEEESS::Appoint committee membersCall committee chairs to urge them into actionPromote attendance at board/committee meetingsRecruit new board membersPlan agenda for board meetingsTake minutes at board meetingsPlan and propose committee organizationPrepare exhibits, material and proposals

for board and committeesSign legal documentsFollow up to ensure implementation of board

and committee decisionsSettle clashes between committees

PPaarrttyy

StaffBoardStaffBoardJointBoardBoard

BoardStaffStaffBoardStaff

BoardStaffJoint

BoardBoardJointBoardJointStaffJointStaff

BoardStaff

Board


30

Your organization also should have a conflict-of-interest policy for the board. While many organiza-tions feel these issues are understood, policies needto be documented.

Having a written policy does not mean theorganization cannot do business with any boardmembers or companies for which board membersworks. Basically a conflict of interest policyshould state that the board members list anypotential or perceived conflicts of interest theymight have, that they submit bids for any workalong with other competing businesses, and thatthey remove themselves from voting on items inwhich they may have a conflict of interest.

Buidling an Effective Board of Directors

Conflict of Interest

SAMPLE CONFLICT OF INTEREST POLICY

The standard of behavior at the XYZ Organization is that all staff, volun-teers, and board members scrupulously avoid conflicts of interest between theinterests of the XYZ Organization on one hand, and personal, professional, andbusiness interests on the other. This includes avoiding potential and actual con-flicts of interest, as well as perceptions of conflicts of interest.

I understand that the purposes of this policy are to protect the integrity ofthe XYZ Organization’s decision-making process, to enable our constituencies tohave confidence in our integrity, and to protect the integrity and reputations ofvolunteers, staff and board members. Upon or before election, hiring or appoint-ment, I will make a full, written disclosure of interests, relationships, and holdingsthat could potentially result in a conflict of interest. This written disclosure will bekept on file and I will update it as appropriate.

In the course of meetings or activities, I will disclose any interests in a trans-action or decision where I (including my business or other nonprofit affiliations),my family and/or my significant other, employer, or close associates will receive abenefit or gain. After disclosure, I understand that I will be asked to leave theroom for the discussion and will not be permitted to vote on the question.

I understand that this policy is meant to supplement good judgment, and Iwill respect its spirit as well as its wording.

Signed:

Date:


31


A policy on conflict of interest has threeessential elements:

■■ Full disclosure: Board members and staffmembers in decision-making roles shouldmake known their connections withgroups doing business with the organiza-tion. This information should be providedannually.

■■ Board member abstention from discussionand voting: Board members who have actu-al or potential conflicts of interest shouldnot participate in discussions or vote onmatters affecting transactions between theorganization and the other group.

■■ Staff member abstention from decision-making: Staff members who have actual orpotential conflicts should not be substan-tively involved in decision-making affect-ing such transactions.

A sample disclosure form is on the next page.

BETTER SAFE THAN SORRY

Much of conflict of interest is in perception. When things are inthe open, misunderstandings are less likely to happen, protecting theintegrity of the organization and the individual.


Although many organizations feel they can’t “fire” avolunteer, there are times when a board membershould be asked to leave. When evaluating the per-formance of its board members, the organizationneeds to determine if a director is a “star performer,”a mediocre board member or a real problem. Asmentioned before, the board evaluation is handledby a small committee, usually the executive commit-tee or the board resources committee. And an issue

32


SAMPLE DISCLOSURE STATEMENT

Please initial in the space at the end of Item A or complete Item B, whichev-er is appropriate, complete Item C, and sign and date the statement and return itto the board chair.

A. I am not aware of any relationship or interest or situation involving myfamily or myself which might result in, or give the appearance of being, a conflictof interest between such family member or me on one hand and XYZ on the other._________________ (Initials)

B. The following are relationships, interests or situations involving me or amember of my family which I consider might result in or appear to be an actual,apparent or potential conflict of interest between such family members or myselfon one hand and XYZ on the other; _________________ (Initials)

For-profit corporate directorships, positions and employment with:

Nonprofit trusteeships of positions:

Memberships in the following organizations:

Contracts, business activities and investments with or in the following organi-zations:

Other relationships and activities:

My primary business or occupation at this time is:

I have read and understand XYZ’s conflict of interest policy and agree to bebound by it. I will promptly inform the board chair of XYZ of any material changethat develops in the information contained in the foregoing statement.

Type/print name:

Signature: Date:

Time to Fire aBoard Director?


33


as serious as firing a director is never handled by asingle individual.

Board members whose service is mediocre cansometimes be turned into star performers withthe proper motivation. First, identify the problemareas and sit down with the board member to dis-cuss these issues. This interview/review is bestdone by the executive director and board chair(assuming it is not the board chair who is theproblem). Perhaps the board member just doesnot have the time to give that the organizationneeds, or maybe he or she has lost interest in themission or has had personality conflicts withother board members.

Each of these areas needs to be addressed. Ifthe board member is not committed to the mis-sion of the organization, it is probably best forhim or her to move on. If the problem is one of atime constraint, perhaps this board memberwould do better serving on a committee ratherthan on the board, particularly if the person’sinterest and expertise are in a specific area. If it isa matter of personality conflict, the outcome willdepend on the severity of the situation.

If the problem is a conflict between two boardmembers, the board chair may need to sit downwith each person and see if a resolution can bereached. Boards do not always need to think andact in total harmony, but open conflict is notgood for an organization’s well-being, whichshould take priority over personal differences.Sometimes these difference can lead to positivechange if handled properly.

FREE ADVICE

Don’t let one rotten apple spoil the whole board—even if theapple is an important donor. Sometimes one personality can chase offgifted directors, affecting your leadership, morale and reputation. Ifyou are wondering if your organization can survive without the onedirector, maybe a better question to ask is Can you survive WITH him?


Sometimes, however, the source of these “per-sonality conflicts” is one person—your “500-pound gorilla.” Others may rather slip away quiet-ly rather than create a conflict with this individ-ual, and your board is losing great directorsbecause of one personality. The problem directormay need to be removed from the board if he/sheis not willing to change. Try to identify areas forimprovement, just as you would do with a paidstaff person and develop a system to monitorresults. And always do “exit interviews” with yourdeparting directors, whether leaving suddenly orat the end of a term, to see what their experiencehas been with your board and organization.

What should an organization do if the board is notfunctioning as it should? Or the organization isabout to embark on a capital campaign or a plannedgiving program and the board is not ready for thenew initiative?

Some ways to take the board to a higher levelof performance include:

■■ Reviewing and rotating committee assign-ments. Often people are pegged into certainslots on the board because of their work expe-rience. For example, a banker is almost alwaysasked to serve on the finance committee—butperhaps this person really loves working withchildren or has an artistic interest, and theymay prefer working on a program committeein a human service agency or a collectionscommittee of a museum. Also, don’t takeyour board members and their expertise forgranted. For instance, an attorney should notbe expected to handle all the organization’slegal issues gratis.

■■ Continuing education for board members.Keep your board members motivated andinvolved by offering at your board meetingsprogram presentations by staff members and

34


Going to the NextLevel


35


seminars on leadership training, strategicplanning and ethical decision-making by con-sultants. Remember that board memberswant to get as well as give to the organization.Some organizations provide leadership train-ing that offers continuing education creditfor board members.

■■ Recognition. Board members, like other vol-unteers, desire and deserve to be recognizedfor their work. Departing directors should begiven meaningful tokens of appreciation.Board members should be recognized atevents and in publications. And of course, say-ing thank you goes a long way.

■■ Involving board members in cultivationevents. Some ideas for further involving yourboard of directors are having them invite theirfriends to learn about the organizationthrough a tour of the facility, asking them tohost fundraising events, or suggesting theyconduct a “Thank-A-Thon” in which they callmajor donors to thank them for their giftswithout asking for money. Cultivation eventslike these are ways to inspire a greater level ofinterest with your directors and bring othersinto the organization. These type of eventsallow board members to see first-hand howtheir contacts in the community can help theorganization grow. Every board member has asphere of influence in the community—oftenthey just need to know how that connectionmight benefit the organization.

Finally, to recap how to make sure your boardis functioning well, follow these steps:

■■ Evaluate the demographics and the skillsof the current board

■■ Determine how many and what categoriesof board members are needed to providethe right mix on the board


■■ Evaluate committee structure of the boardand create new committees if needed orabolish extraneous ones

■■ Evaluate effectiveness of board meetingsand restructure if necessary

■■ Determine if some board members shouldbe asked to leave the board—and do it

■■ Identity potential board members whoseprofiles fit needed skills on the board

■■ Develop a board recruitment packet,including board position description

■■ Recruit new board members as needed

■■ Develop a board education program

■■ Conduct an annual board appeal

■■ Involve the board in fundraising throughdonor screening sessions and solicitationstrategies

■■ Involve the board in cultivation and stew-ardship activities

■■ Involve the board in the strategic planningprocess

■■ Conduct an annual board retreat

■■ Recognize the board for its contributionsto the organization

By following these steps, your organizationcan build an enthusiastic and committed boardthat can take your charity to a higher level of per-formance. If the board functions properly, repre-sents the charity well to the community and isinvolved in fundraising efforts, the organizationwill grow.

36



HH ow well the board is fulfilling its role and responsibilities? Thefollowing self-evaluation is to be completed by each board mem-ber.

Check the column number 1 to 5 for each statement where 1 = poorand 5 = equals very good

Appendix A:BOARD OF DIRECTORS SELF-EVALUATION

37

Consideration 1 2 3 4 5

1. Board has full and common understanding of the roles andresponsibilities of a board of directors.

2. Board members understand the organization’s mission andits programs.

3. Structure of the board, officers and committees is clearregarding individual and group roles and responsibilities.

4. Board has clear goals and actions resulting from relevantand realistic strategic planning.

5. Board attends to policy-related decisions which effectivelyguide operational activities.

6. Board receives regular reports on and understandsfinances/budgets, products/program performance and otherimportant matters.

7. Board helps set fundraising goals and is actively involved infundraising.

8. Board effectively represents the organization to the commu-nity.

9. Board regularly monitors and evaluates progress on impor-tant organizational matters.

10. Board has approved comprehensive volunteer and person-nel policies.

11. Each member of the board appears to be involved and inter-ested in the board’s work.

12. All necessary skills, stakeholders and diversity are represent-ed on the board.


38


List three to five issues you would like the board to focus on nextyear. Please be specific.

1.

2.

3.

4.

5.


39

Appendix B:BOARD OF DIRECTORS INDIVIDUAL EVALUATION

Boa

rd M

emb

er

Act

ive

Fu

nd

rais

er?

Y/N

Tim

e gi

ven

to o

rg?

Ave

rage

ann

ual

gif

t C

omm

itte

es

Ter

mex

pir

es

Off

ices

or

Com

m.

Ch

airs


40

1. What percentage of board members make a meaningful financialcommitment to the organization on an annual basis, either personally orthrough their companies?

_____100% (10) _____40% (4)_____90% (9) _____30% (3)_____80% (8) _____20% (2)_____70% (7) _____10% (1)_____60% (6) _____0% (0)_____50% (5) POINTS_____

2. What percentage of the board has made a planned gift to theorganization?

_____100% (10) _____40% (4)_____90% (9) _____30% (3)_____80% (8) _____20% (2)_____70% (7) _____10% (1)_____60% (6) _____0% (0)_____50% (5) POINTS_____

3. What percentage of the board made a contribution to the organi-zation’s last capital campaign (if applicable)?

_____100% (10) _____40% (4)_____90% (9) _____30% (3)_____80% (8) _____20% (2)_____70% (7) _____10% (1)_____60% (6) _____0% (0)_____50% (5) POINTS_____

4. What percentage of the board attends events held by the organiza-tion?

_____100% (10) _____40% (4)_____90% (9) _____30% (3)_____80% (8) _____20% (2)_____70% (7) _____10% (1)_____60% (6) _____0% (0)_____50% (5) POINTS_____

Appendix C:BOARD FUNDRAISING ASSESSMENT


41


5. The board helps develop our long-range and annual development(fundraising) plan?

____Yes, all are involved (10)____Some are involved (5)____None are involved (0) POINTS_____

6. The board is involved in recruiting volunteer fundraisers?


7. The board helps identify potential donors to the organization?


8. The board plans and attends cultivation events regularly?


9. The board has an adequate number of people with affluence andinfluence in the community?


10. Board members actively promote the organization within theirown spheres of influence?


TOTAL POINTS____________


42

WW hat are your expectations as a board member? Answer the fol-lowing questions to assess your interest.

1. I primarily like working with:numbers/research content/material other agenciespeople programs/services

2. I primarily like working on projects in:administration community planning events

3. My primary medium for working is:phone/fax books/resources emailconversation (face-to-face) teaching/presenting to a group

4. My overall goal is to help the organization:be responsible financially develop exposuredevelop programs anticipate community needs develop resources, network, & financerecruit volunteers

5. My other reasons for getting involved are to:build my résumé develop professional contactsmake social contacts gain experienceuse my skills make an impact in the communitygain recognition for efforts

6. I primarily like work that is:logistical and practical creative/inventiveroutine/formatted vascillating/cyclical

7. Realistically, I have this much time available for board/committeework at this organization:

per week per month

8. My current commitment to the mission of this organization on a scaleof 1 (very low) to 10 (very high) is:

Appendix D:BOARD MEMBER INTEREST ASSESSMENT


43

Appendix E:BOARD MEMBERS PERFORMANCE EVALUATION

Scor

eP

oin

tB

oard

Mem

ber

s

Att

enda

nce

Com

mit

tee

Part

icip

atio

nSu

ppor

t G

ener

atio

n

Ext

erna

l Am

bass

ador

U

nder

stan

ding

Pers

onal

Sup

port

Skill

sN

ame

Lead

ersh

ipC

omm

itm

ent

Dem

eano

r

Ass

ign

poin

ts t

o ca

tego

ry.

10 p

oint

s m

axim

umT

OT

AL

SCO

RE

S10

0-11

0E

xcel

lent

80-9

9 G

ood

60-7

9C

onsi

der

Rep

laci

ng0-

59D

efin

itel

y R

epla

ce

Att

ende

d 75

-100

% o

f m

eeti

ngs

in 1

2 m

os.

Att

ende

d 50

-74%

of

mee

ting

s in

12

mos

.A

tten

ded

25-4

9% o

f m

eeti

ngs

in 1

2 m

os.

Att

ende

d le

ss t

han

25%

of

mee

ting

sA

ctiv

ely

part

icip

ate

on a

t le

ast

1 co

mm

itte

eD

irec

tly

gave

or

rais

ed m

ore

than

$10

,000

Dir

ectl

y ga

ve o

r ra

ised

mor

e th

an $

5,00

0D

irec

tly

gave

or

rais

ed m

ore

than

$1,

000

Dir

ectl

y ga

ve o

r ra

ised

mor

e th

an $

500

Dir

ectl

y ga

ve o

r ra

ised

less

tha

n $5

00D

irec

tly

gave

or

rais

ed $

0Sp

eech

es, e

vent

s, f

undr

aisi

ngIs

info

rmed

on

agen

cy b

usin

ess

& d

irec

tion

Act

ivel

y to

ok p

art

in o

rgan

izat

ion’

s ev

ents

Bri

ngs

need

ed t

echn

ical

ski

lls t

o bo

ard

Nam

e ad

ds c

redi

bilit

y to

the

org

aniz

atio

nSe

rved

as

offi

cer,

com

mit

tee

chai

r, m

ajor

tas

kIs

com

mit

ted;

ent

husi

asti

c; r

ecru

its

mem

bers

Is p

rodu

ctiv

e an

d fo

cuse

d

10 7 4 1 10 10 8 6 4 2 0 10 10 10 10 10 10 10 10


Appendix F:GENERAL BOARD CHECKLIST

Rating Indicator Met NeedsWork

N/A

E 1. The roles of the board and the executive direc-tor are defined and respected, with the executivedirector delegated as the manager of the organi-zation’s operations and the board focused on pol-icy and planning

R 2. The executive director is recruited, selected,and employed by the board of directors. Theboard provides clearly written expectations andqualifications for the position, as well as reason-able compensation.

R 3. The board of directors acts as governingtrustees of the organization on behalf of the com-munity at large and contributors while carryingout the organization’s mission and goals. To fullymeet this goal, the board of directors must active-ly participate in the planning process as outlinedin planning sections of this checklist.

R 4. The board’s nominating process ensures thatthe board remains appropriately diverse withrespect to gender, ethnicity, culture, economicstatus, disabilities, and skills and/or expertise.

E 5. The board members receive regular trainingand information about their responsibilities.

E 6. New board members are oriented to the organi-zation, including the organization’s mission,bylaws, policies, and programs, as well as theirroles and responsibilities as board members.

A 7. Board organization is documented with adescription of the board and board committeeresponsibilities.

A 8. Each board has a board operations manual.

Indicators ratings: E=essential; R=recommended; A=additional to strengthen organizational activities


This information may be copied. Please cite credit to the United Way of Minneapolis Area.

Rating Indicator Met NeedsWork

N/A

E 9. If the organization has any related party trans-actions between board members or their family,they are disclosed to the board of directors, theInternal Revenue Service and the auditor.

E 10. The organization has at least the minimumnumber of members on the board of directors asrequired by their bylaws or state statute.

R 11. If the organization has adopted bylaws, theyconform to state statute and have been reviewedby legal counsel.

R 12. The bylaws should include: a) how and whennotices for board meetings are made; b) howmembers are elected/appointed by the board; c)what the terms of office are for officers/members;d) how board members are rotated; e) how inef-fective board members are removed from theboard; f) a stated number of board members tomake up a quorum which is required for all poli-cy decisions.

R 13. The board of directors reviews the bylaws.

A 14. The board has a process for handling urgentmatters between meetings.

E 15. Board members serve without payment unlessthe agency has a policy identifying reimbursableout-of-pocket expenses.

R 16. The organization maintains a conflict-of-interest policy and all board members and execu-tive staff review and/or sign to acknowledge andcomply with the policy.

R 17. The board has an annual calendar of meet-ings. The board also has an attendance policysuch that a quorum of the organization’s boardmeets at least quarterly.

A 18. Meetings have written agendas and materialsrelating to significant decisions are given to theboard in advance of the meeting.

A 19. The board has a written policy prohibitingemployees and members of employees’ immediatefamilies from serving as board chair or treasurer.


AFP Code of Ethical Principles and Standards ofProfessional Practice

STATEMENT OF ETHICAL PRINCIPLESAdopted 1964; amended October 1999

The Association of Fundraising Professionals (AFP) exists to foster the development and growthof fundraising professionals and the profession, to promote high ethical standards in thefundraising profession and to preserve and enhance philanthropy and volunteerism.

Members of AFP are motivated by an inner drive to improve the quality of life through the caus-es they serve. They serve the ideal of philanthropy; are committed to the preservation andenhancement of volunteerism; and hold stewardship of these concepts as the overriding princi-ple of their professional life. They recognize their responsibility to ensure that needed resourcesare vigorously and ethically sought and that the intent of the donor is honestly fulfilled. Tothese ends, AFP members embrace certain values that they strive to uphold in performing theirresponsibilities for generating charitable support.

AFP members aspire to:· practice their profession with integrity, honesty, truthfulness and adherence to the

absolute obligation to safeguard the public trust;· act according to the highest standards and visions of their organization, profession and

conscience;· put philanthropic mission above personal gain;· inspire others through their own sense of dedication and high purpose;· improve their professional knowledge and skills, so that their performance will better

serve others; · demonstrate concern for the interests and well-being of individuals affected by their

actions; · value the privacy, freedom of choice and interests of all those affected by their actions;· foster cultural diversity and pluralistic values, and treat all people with dignity and

respect; · affirm, through personal giving, a commitment to philanthropy and its role in society;· adhere to the spirit as well as the letter of all applicable laws and regulations;· advocate within their organizations, adherence to all applicable laws and regulations;· avoid even the appearance of any criminal offense or professional misconduct; · bring credit to the fund-raising profession by their public demeanor;· encourage colleagues to embrace and practice these ethical principles and standards of

professional practice; and· be aware of the codes of ethics promulgated by other professional organizations that

serve philanthropy.

STANDARDS OF PROFESSIONAL PRACTICEFurthermore, while striving to act according to the above values, AFP members agree to abide bythe AFP Standards of Professional Practice, which are adopted and incorporated into the AFPCode of Ethical Principles. Violation of the Standards may subject the member to disciplinarysanctions, including expulsion, as provided in the AFP Ethics Enforcement Procedures.

Professional Obligations1. Members shall not engage in activities that harm the members’ organization, clients, or

profession.2. Members shall not engage in activities that conflict with their fiduciary, ethical, and


legal obligations to their organizations and their clients.3. Members shall effectively disclose all potential and actual conflicts of interest; such disclosure does not preclude or imply ethical impropriety.4. Members shall not exploit any relationship with a donor, prospect, volunteer, or

employee to the benefit of the members or the members’ organizations.5. Members shall comply with all applicable local, state, provincial, and federal civil and

criminal laws.6. Members recognize their individual boundaries of competence and are forthcoming and

truthful about their professional experience and qualifications.

Solicitation and Use of Charitable Funds7. Members shall take care to ensure that all solicitation materials are accurate and correct-

ly reflect their organization’s mission and use of solicited funds.8. Members shall take care to ensure that donors receive informed, accurate, and ethical

advice about the value and tax implications of potential gifts.9. Members shall take care to ensure that contributions are used in accordance with

donors’ intentions.10. Members shall take care to ensure proper stewardship of charitable contributions,

including timely reports on the use and management of funds.11. Members shall obtain explicit consent by the donor before altering the conditions of a

gift.

Presentation of Information12. Members shall not disclose privileged or confidential information to unauthorized

parties.13. Members shall adhere to the principle that all donor and prospect information created

by, or on behalf of, an organization is the property of that organization and shall not betransferred or utilized except on behalf of that organization.

14. Members shall give donors the opportunity to have their names removed from liststhat are sold to, rented to, or exchanged with other organizations.

15. Members shall, when stating fundraising results, use accurate and consistent account-ing methods that conform to the appropriate guidelines adopted by the AmericanInstitute of Certified Public Accountants (AICPA)* for the type of organization involved.(* In countries outside of the United States, comparable authority should be utilized.)

Compensation16. Members shall not accept compensation that is based on a percentage of charitable

contributions; nor shall they accept finder’s fees.17. Members may accept performance-based compensation, such as bonuses, provided

such bonuses are in accord with prevailing practices within the members’ own organiza-tions, and are not based on a percentage of charitable contributions.

18. Members shall not pay finder’s fees, or commissions or percentage compensationbased on charitable contributions, and shall take care to discourage their organizationsfrom making such payments.

Amended October 1999


48


THE AUTHOR

Linda Lysakowski, ACFRE, is one of the first 55 fundraisers worldwide toachieve the Advanced Certified Fundraising Executive designation. Linda is presi-dent/CEO of CAPITAL VENTURESM, a consulting and training company. Linda canbe reached at [email protected].

ADDITIONAL RESOURCES

The AFP Bookstore carries many titles dealing with board development andrelated issues. These may be purchased at the AFP websitewww.afpnet.org/afp_marketplace_and_bookstore

AFP Code of Ethical Principles and Standards of Professional Practice canbe found on the AFP website at www.afpnet.org/ethics

AFP Fundraising Resource Center—Contact the Resource Center for ques-tions relating to fundraising, philanthropy and nonprofit management. Phone:(800) 688-FIND (3463) or email: [email protected]

BoardSource—Dedicated to increasing the effectiveness of nonprofit organi-zations by strengthening their boards of directors. For more information seewww.boardsource.org or phone 202-452-6262 or 800-883-6262.


I.To be informed of the organization’s mission, o f

the way the organization intends touse donated resources, and of its capacity to use donations effectively for their intended purposes.

II.To be informed of the identity of those serving

on the organization’s governing board,and to expect the board to exercise prudent

judgement in its stewardship responsibilities.

III.To have access to the organization’s

most recent financial statements.

IV.To be assured their gifts will be used forthe purposes for which they were given.

V.To receive appropriate

acknowledgement and recognition.

VI.To be assured that information about

their donations is handled with respect and withconfidentiality to the extent provided by law.

VII.To expect that all relationships with

individuals representing organizations of inter-est to the donor will be professional in nature.

VIII.To be informed whether those seeking

donations are volunteers, employees of theorganization or hired solicitors.

IX.To have the opportunity for their

names to be deleted from mailing lists thatan organization may intend to share.

X.To feel free to ask questions when making

a donation and to receive prompt, truthful andforthright answers.

A Donor Bill of RightsP H I L A N T H RO P Y is based on vo l u n ta ry action for the common good. It is a tra d i-tion of giving and sharing that is pri m a ry to the quality of life. To assure that philan-th ro py merits the respect and tru st of the ge n e ral public, and that donors and pro s p e c-t i ve donors can have full confidence in the not - fo r- p ro fit organizations and causes th eya re asked to support, we declare that all donors have these ri g h t s :

D E V E L O P E D B YAMERICAN ASSOCIATION OF

FUND RAISING COUNSEL (AAFRC)

ASSOCIATION FOR HEALTHCARE PHILANTHROPY (AHP)

COUNCIL FOR ADVANCEMENT AND

SUPPORT OF EDUCATION (CASE)

ASSOCIATION OF FUNDRAISING PROFESSIONALS (AFP)

International Headquarters4300 Wilson Blvd., Ste. 300 Arlington, VA 22203 703-684-0410 800-666-3863 (U.S. & Canada) 703-684-0540 fax

MexicoAniceto Ortega 629, Colonia del Valle CP 03100, Ciudad de Mexico, DF (52) 55-3626-1592 (52) 55-3626-1593 fax Toll free 001-866-837-1948

Canada260 King Street East, Ste. 412 Toronto, ON M5A 4L5 416-941-9144 | 416-941-9013 fax

www.afpnet.org

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