The Nonprofit FAQ
| How should the board and the executive director relate? |
| For more on this topic from the Minnesota Council of Nonprofits, visit the http://www.mncn.org/info/basic_gov.htm#board%20role%20&%20resp">board basics section of the website at http://www.mncn.org. "No single relationship in the organization is as important as that between the board and its chief executive officer. Probably no single relationship is as easily misconstrued or has such dire potential consequences. That relationship, well conceived, can set the stage for effective governance and management." John Carver, Boards that Make a Difference, 1990. (Order http://www.amazon.com/dp/0787908118/?tag=internetnonprofi">Boards that Make a Difference from Amazon.Com; a royalty will be paid that helps support this service.) The relationship between the Board of Directors and the Executive Director is one of the most written about topics in nonprofit literature. This document summarizes some of the thoughtful material that has been written on this subject, including the book cited above and information from BoardSource (http://www.boardsource.org) and Independent Sector (http://www.independentsector.org). For more on the subject and others, please see http://www.mncn.org/info/basic_gov.htm#board%20role%20&%20resp">board basics at the website http://www.mncn.org. As a general rule of thumb, it is said that in a nonprofit organization, boards primarily govern and staff primarily manages. This means that a board provides counsel to management and should not get involved in the day-to-day affairs of the organization. Confusion and tension can arise when this rule is put to use practically, because the distinction between management and governance is not absolute. In order for this rule to work effectively, each party in this relationship needs to understand its own responsibilities and those that fall in the other's purview, and the way in which the board and staff conduct their business needs to reflect this understanding. Clear expectations for the board and the director need to be established and maintained, because a board that is overly active in management can inhibit the organization's effectiveness. A nonprofit's Board of Directors has very specific duties that are distinct from those of the Executive Director. Directors have fiduciary responsibilities, and they are required to act within their authority primarily for the organization's benefit. Directors do not have power or authority individually. A board's decision-making ability lies in its group structure. While at times an individual board member may become extensively involved with one particular program area and be working with staff, this is usually temporary, and information regarding the need for increased attention by that board member should be relayed regularly to the full board. (The Minnesota Attorney General has a useful paper on http://www.ag.state.mn.us/charities/charDuties.html">fiduciary duties on the website at http://www.ag.state.mn.us/. -- Ed.) Nonprofit boards generally have the duties of selecting and working with the executive director, amending bylaws, approving the annual budget and long-term strategic plans, and ensuring its own succession. The board often establishes committees to accomplish its activities, including financial, personnel, fundraising and planning functions. Through such committees, the board assists management in policy formation and strategic planning. While nonprofit staff may conceive, develop and implement the organization's plan, the board will often monitor the process and provide counsel. However, it is often true that in smaller, younger nonprofits with limited staff positions or experience, or in more grass-roots type organizations, board duties may include more tasks typically associated with management. Ultimately, the ideas and actions of the Executive Director, perhaps more than the will of the board, will influence the nature of the dynamic that characterizes this important relationship. Because it falls to the Executive Director to help determine which issues the board will address and to assemble the information that shapes the discussion, this individual can guide the board towards a true governance role. The following are three specific methods that the Executive Director can take to help the board govern more and manage less:
The Free Management Library provides additional information. See "Role of the Chief Executive" at http://www.mapnp.org/library/chf_exec/chf_exec.htm and "Sustaining a High-Quality Relationship Between Board Chair and Executive Director" at http://www.mapnp.org/library/chf_exec/ed_chair.htm Revised 8/11/99, 1/18/00 -- PB & CM; 1/30/05 -- PB |