Posted on Leave a comment

A Guide to Standing Committees for Nonprofits — The Executive Committee

The Executive Committee of a nonprofit board can have many different forms and functions, often depending on the size or engagement of the board. Today we’ll look at several options and their advantages. First, though, let’s look at some rather universal concepts.

The Executive Committee is generally the body that directly oversees an organization’s highest paid staff member. Hiring, compensation, performance evaluation, and firing decisions are nearly always made by this group, which then informs the board of their decisions or recommendations. Housing these sensitive personnel matters in the Executive Committee provides important perspective and check and balances for your board president, and also confines the discussion of potentially sensitive personal information to a small, trusted group of board members, as opposed to presenting these discussions in the more open setting of a full board meeting.

In addition, the Executive Committee should have a strong voice regarding the agenda of meetings of the full board. In this role, the committee should ensure all important information and items for discussion and decision are included on your board agenda at the appropriate time to meet target dates in the strategic timeline or legal/regulatory deadlines. The Executive Committee should also ensure that any matter presented to your board for decision has been fully investigated and vetted, thereby ensuring your board members have all the information they need to make a decision for the organization.

If your organization has a large board, the Executive Committee can play a very important role in communicating information to and from your organization’s leadership. In this scenario, the chairpersons of each committee of the board, along with the board’s officers, generally comprise the membership of the Executive Committee. These members take decisions about the organization’s strategic direction to the various committees, which then work to implement those decisions in more detail. The members of the Executive Committee also report on their committees’ progress, to ensure continued alignment and to prevent duplication of efforts.

For a smaller board, the Executive Committee may only include the officers of the board, who may occupy a more hands on role in assisting your Executive Director.

Whichever structure makes sense for your organization, think of your Executive Committee as the body that helps coordinate the work of the board to maximize board engagement and effectiveness.

And because the Executive Committee plays such a central and often sensitive role, I recommend all members of this committee be members of your board currently in office. We’ll look at other committees where non-board members can appropriately serve, but the Executive Committee isn’t one of them.

With these concepts in mind, let’s look at another common function of the Executive Committee. Most state laws permit the Executive Committee to act between meetings of the full board, provided their actions are reported to and ratified by the full board at its next meeting. While this power certainly allows decisions to be made quickly and permits the scheduling of less frequent meetings of the full board (which, admittedly, means less work for staff), it may also contribute to less board engagement. There is a danger that, since the Executive Committee is easier to assemble and often consists of the Executive Director’s and board president’s closest colleagues, more and more decision making will be shifted over time to the committee, instead of allowing the full board the opportunity to consider important issues and feel engaged in the work of the organization. I generally recommend that the power of the Executive Committee to act between meetings of the full board be limited to emergency situations.

The following is a sample description of the Executive Committee’s responsibilities:

Membership of the Executive Committee shall be comprised of the officers of the Corporation, the chairpersons of each of the Corporation’s standing committees, and such other individuals as may be appointed by the Chair of the Board, provided that all members of the Executive Committee shall be Directors of the Corporation currently in office. The Executive Committee will serve as the compensation committee and is responsible for hiring and determining compensation for the President of the Corporation.  The Executive Committee, if necessary to meet legal deadlines or obligations or in emergency situations where action is required immediately, may have and exercise all of the authority of the Board of Directors in the management of the Corporation except as such authority is limited by the Articles of Incorporation, the Regulations, or by statute, or as may be limited by the resolution relating to the Committee.  All action taken by the Executive Committee shall be reported at the next full Board meeting.  The Executive Committee may act by a majority of the members of the Executive Committee at a meeting or in a writing or writings signed by all Executive Committee members.

One final comment for smaller organizations — if a board lacks sufficient members to staff all of the standing committees you might like to have, it is possible to have the Executive Committee assume the typical duties of the Board Development Committee, especially when an organization is in its formative years.

Posted on Leave a comment

A Guide to Standing Committees for Nonprofits — The Board Development Committee

Most of us are familiar with the concept of a nominating committee, the primary or perhaps only responsibility of which is to nominate new board members and officers for your organization’s board of directors. Typically, the process goes something like this:

A month or two before the annual meeting, the board chair asks for a small group of volunteers to put together a slate of nominees for the board. That group meets to come up with a short list of people they think would agree to serve by looking at their own personal list of contacts. Phone calls are made, simple expectations for board members communicated, and the group gets back together to see who said yes and who said no. If enough candidates said yes to fill the vacant slots, the list is forwarded to the full board, and then voted on at the annual meeting. A similar process is probably used to recruit officers from among the board, generally also elected at the annual meeting. Here ends the responsibility of the nominating committee.

This process gives short shrift to your organization’s need to create and maintain an involved, effective board with the skills and diversity necessary to advise staff on strategy and best practices for your service area. Imagine board and committee meetings where you can pose challenging questions about the overall direction, effectiveness and financial stability of your organization and consistently receive advice and counsel that is relevant and on point. If this kind of dynamic doesn’t sound like your board, I recommend the first place you look is your nominating committee.

The names nominating, governance and board development committee are often used interchangeably. Consider, though, the scope of the work implied by these names. The nominating committee nominates candidates for election. There is often no overarching strategy or planning involved, no assessment of the skills sets needed by the organization, and no long view of succession planning for leadership. A nominating committee is like failing to attend class all semester and cramming for the test the night before — you may pass the test but any long term retention of the information is probably accidental.

A governance committee gets a little closer to our ideal, in that the name implies some ongoing responsibility for monitoring board members’ performance against stated duties. However, often the strategic view of cultivating and recruiting new members to the board is missing.

The board development committee should, ideally, encompass all of these responsibilities. Its members should be carefully chosen from among members of the Board (this generally is not a committee where non-board members serve as volunteers). The responsibility of the board as whole is to set strategy, so the responsibility of the board development committee should include a strategic view of who is on the board, how members are recruited, what training and information members need to be effective, and how board members will be held accountable for their performance.

The following is a sample description of the a board development committee. It is fairly comprehensive, but I have used it for both large and small organizations. If your board is small, the duties of the board development committee can be combined with the executive committee until your board is large enough to support both standing committees.

Membership of the Board Development Committee shall consist solely of Directors of the Corporation currently in office.  The Board Development Committee shall: (a) identify and evaluate candidates for election and re-election to the Board and recommend them for election; (b) identify Directors to serve as Officers and nominate them for election by the Board; (c) approve candidates recommended to serve as Ex Officio Directors; (d) assist the Board in developing a statement of expectations for individual Directors, including standards for committee service and financial support; (e) develop procedures for the cultivation and recruitment of new Directors, including an assessment of skills, expertise and diversity needed to provide strategic direction to staff; (f) create and implement an orientation program for new Directors; (g) consult with the President regarding committee assignments for Directors and other individuals; (h) monitor the procedure by which Directors annually identify and report known and potential conflicts of interest; (i) from time to time, recommend to the voting Directors amendments and revisions to the Articles of Incorporation and the Code of Regulations; (j) develop and implement criteria for, and conduct, annual evaluations of individual Directors and the Board as a whole; (k) engage in succession planning for Board leadership, especially the position of President, and make recommendations to the Board regarding the process and timing of leadership transitions; (l) keep informed of current and emerging best practices in the field of non-profit board governance and operation.

Next time, we’ll take a look at best practices related to the function of the Executive Committee.

Posted on Leave a comment

A Guide to Standing Committees for Nonprofits — General Principles

No matter how big or small your organization is, having a solid structure for your volunteer board and committees is one of the best ways to make sure your board is efficient, engaged, and adding value to your management team. While there are templates and guidelines galore for committee descriptions, not every organization will need (or be able to support) the same committee structure. This blog series will look at the most common standing committees, what they can do, what they really should do, and how to integrate them within your larger board structure.

First, let’s outline some basic concepts. Your committee structure should be outlined in your organization’s By Laws or, as they’re called in Ohio, Code of Regulations. I’ll be speaking to Ohio’s nonprofit corporation law, but in terms of committee powers, most states are very similar. If you’re not in Ohio, though, be sure to check you state laws to make sure there are no conflicting provisions.

The theory behind any committee structure, no matter how simple or robust, is that many hands make light work. While the whole board should be involved in certain activities, and should always be the final decision making authority for the organization, the detail work of researching, investigating and advising management to recommend actions should be done by smaller groups of volunteers. That way when you present a strategy to your board, you’ve really run down all the pros and cons and can put a viable plan in front of them to discuss and, hopefully, adopt.

Committees are also the place to pull in expertise from people who don’t sit on your board. Accountants, lawyers, industry experts, consultants, service providers, and others with specific experience in your service area often have much to offer in vetting possible strategies. These people are often not the best choice for board members, though, because they may not be willing or able to engage in the kind of fundraising, outreach or advocacy that your whole board really needs to do. (We’ll dive in to that more our post about development committees.)

Remember, most importantly, that committees are supposed to help management, not add to their work load. If you’re a nonprofit manager and you routinely worry about creating an agenda for committee meetings because you don’t know what they’re supposed to do, don’t feel like you have work for them, or don’t want to have to manage the less than helpful suggestions that come out of your committee meetings, then I’d like to suggest you don’t have the right committee structure. Your board and your committee structure are not the place to steward and engage your biggest donors. Any organization’s committee structure must be a reflection of the organization’s mission and work plans, and help your staff work most effectively.

Next up we’ll look at the Board Development Committee. Until then, practice removing the phrase “nominating committee” from your vocabulary!

Posted on Leave a comment

Stacy Bauer is COSE’s Volunteer of the Year

trophy

We are thrilled to congratulate Stacy Bauer, winner of this year’s Volunteer of the Year Award presented by COSE.  Stacy has been very involved in COSE since joining in 2011, participating in many activities supporting Cleveland’s business community, including COSE’s Ambassador program.

Join us in congratulating Stacy on this well-deserved honor!