Board Basics: An Overview of a Nonprofit Board
The board of directors of a nonprofit corporation is legally and financially
responsible for the conduct of the organization. It is not a passive role but rather one that must be active for the good
of the organization and for reducing liability of the individual directors. It is not just for-profit corporations that are
under ever increasing scrutiny for ethical operations.
State laws may establish a minimum size of a board and in some states,
new corporations can have a board of directors consisting of as little as only one member who fulfills all roles. As the corporation
grows, others are added. As a general guide, nonprofit corporations should have at least five or more members who are related
only in their commitment to the organization. Be certain to seek the advice of a lawyer if you have any doubt about the law
pertaining to boards in your state.
The varied talents and contacts of a board from diverse backgrounds
can help an organization grow. A good board member is one that brings unique ability and perspective to a board and takes
an active interest in the organization. Having a "well known" board member for the sake of their name can be more damaging
than beneficial. Having board members who are connected in the community, are representative of your constituency and truly
want to help the organization succeed are a better fit.
The board governs the organization and has specific fiduciary responsibilities
for which it must be accountable. These responsibilities are summarized in How to Provide Good Nonprofit Leadership, a brief
article on board duties. Additional responsibilities vary but generally include oversight of policy, budgeting, planning,
fundraising, human resources, program evaluation and board development. One of the most important roles of the board is to
hire an executive director for the organization and to give that person room to lead. The board should provide oversight and
not become involved in day-to-day operations.
The board is organized under officers and through committees. This
is a practical and effective way to provide governance of most organizations and helps to involve all board members. Traditionally
officers include a chair who presides at meetings and provides management of the board, a vice-chair who presides in the absence
of the chair, a treasurer and a secretary. The treasurer and secretary positions may not be needed as today these roles are
often assigned to staff of the organization.
Committees of the board can include a a finance committee, program
committee, development (fundraising) committee, human resources committee, nominating committee (future board members) and
other areas depending on the needs of the organization. Often smaller nonprofits may have just one or two committees or create
temporary committees based on present needs. The best way to proceed is develop committees as needed and make them standing
or temporary depending on the time it will take to complete committee objectives.
When boards meet, and they should, it is important to record minutes
of the meeting. These minutes are a legal record of activity. They do not need to be extensive but they should adequately
address matters of importance and show that discussions took place including any resulting decisions. Attendance at the meeting
should be recorded as well. In legal terms, absence from a meeting or pleading ignorance does not relieve a board member of
responsibility for actions of the board. The minutes should provide enough information that an absent member would be able
to recognize important discussions that may require their additional review.
The chair of the board should serve as the conduit for communicating
goals and objectives of the board to the executive director of the organization. All members of the board should also interact
with staff, volunteers and those served by the nonprofit in order to gain insight into operations. This active interest also
builds loyalty and enthusiasm and develops mutual respect between the board and those who fulfill the mission of the nonprofit
How can we make our committees more effective?
To ensure that your committees actually help the board do its work
better, follow these suggestions.
- Determine whether you truly need all the committees. Eliminate
the unnecessary ones.
- Turn some committees into task forces with specific time frames.
- Draft a clean job description for each committee. Do not allow
the committees themselves to determine their charter.
- Choose committed members who can advance the objectives set
for the committee and who are able to attend meetings.
- Set meeting schedules well in advance.
- Set term limits for committee members.
- Regularly assess the effectiveness of the committees. Don't
tolerate substandard results.
Non-Profit Development Specialist
PO Box 56
Marshfield, Wisconsin 54449
What are the key duties of the board?
1. Determine the organization's mission and purposes
2. Select the executive staff through an appropriate process
3. Provide ongoing support and guidance for the executive; review his/her
4. Ensure effective organizational planning
5. Ensure adequate resources
6. Manage resources effectively (the buck stops with them, ultimately)
7. Determine and monitor the organization's programs and services
8. Enhance the organization's public image
9. Serve as a court of appeal
10. Assess its own performance
From "Ten Basic Responsibilities of Nonprofit Boards," published by the National Center for Nonprofit Boards, Washington,
Board of Directors Resources
The following publications are available from most book retailers or you can order
direct by contacting the publishers.
Structures and Practices of Nonprofit Boards
Charles F. Dambach
Looking for ways to improve efficiency? Help your board members keep long-term
goals and board development at the forefront of their work. Included are practical guidelines on structural issues, such as
running meetings, committee structure, size of the board, and term limits. Improve the way that your board works by increasing
flexibility and improving interpersonal relationships.
BoardSource, 2003, 52 page booklet, $14.00.
Nonprofit Boards That Work
Does the structure of your board allow for maximum productivity? Examine ways
to increase the effectiveness of your board and the important power of the executive director in strengthening board performance
and keeping board members motivated. Implement innovative ideas for achieving and sustaining an affirmative response to the
challenge of board service.
John Wiley and Sons, 2002, 161 pages, hardcover, $26.00.
The Strategic Board: The Step-By-Step Guide to High
By Mark Light
Is your board ready, willing and able to focus on its chosen mission? Explore
this practical and common sense tool that combine strategic and operational planning, governance and oversight into one simple
and easy-to-use package.
John Wiley and Sons, Inc., 2001, 300 pages, hardcover, $29.00.
Transforming Board Structure: Strategies for Committees
and Task Forces
By Marla J. Bobowick, Sandra R.Hughes and Berit M. Lakey
Is your committee structure too complicated? Explore a fresh look at committees
and how your board can use work groups to streamline the work of the full board. Discover the importance of reducing the number
of standing committees and relying more on ad- hoc groups and task forces to accomplish tasks. To help you get started, the
diskette offers sample job descriptions and additional committee tools.
BoardSource, 2001, 40 pages, paperback, $35.00.
Do you have any questions about developing, managing or strengthening your Board
of Directors? Do you want help locating more resources?
Let us know how we can help!