Effective Board Governance John W. Edwards, Jr. MPA, CCAP,NCRT, CLC The Edwards Group Florida, Inc. Principal Consultant

Effective Board Governance Governance is defined as the legal authority of a board to establish policies that affect the life and work of the organization while holding the board accountable for the outcome of such decisions.

Effective Board Governance Governance is the means by which the community assures that the organization is operated in the public interest.

Effective Board Governance Governing boards are the caretakers of the public trust.

Public Trust The public trust doctrine is the principle that relates back to the origins of democratic government and its seminal idea that within the public lies the true power and future of a society; therefore, whatever trust the public places in its officials must be respected. It is created to promote public well being and not for the needs of any single individual.

Effective Board Governance Steps Define Roles Develop Mission, Vision and Values Determine Structures and Agendas Evaluate Performance Identify and Recruit Orient, Train and Develop Acknowledge and Celebrate

Effective Board Governance What is one positive attribute of your board? What is one challenge that inhibits your board from being effective?

10 Responsibilities of Nonprofit Boards 10. Organize the board to Operate Efficiently: > Appoint committees that have clear charges and strong leadership 9. Develop Board Capacity to Ensure Strong Engagement: > Recruitment, education, and evaluation of board members and board operations.

10 Responsibilities of Nonprofit Boards Continued 8. Select/Support the executive director and Review ED Performance: > Conduct formal annual performance evaluations 7. Enhance the Organizational Public Image: > Participate in marketing and community relations activities.

10 Responsibilities of Nonprofit Boards Continued 6. Determine, Monitor and Strengthen the Organizational Programs: > Ensure there is a program evaluation framework. 5. Ensure Adequate Resource: > Implement the organizational fundraising strategy

10 Responsibilities Nonprofit Boards Continued 4. Ensure Sound Risk Management, Legal and Ethical Integrity: > Ensure adequate insurance. 3. Ensure Effective Fiscal Oversight > Monitor organizational budget.

10 Responsibilities of Nonprofit Boards Continued 2. Engage in Strategic Thinking and Planning: > Establish the organizational direction. Determine Mission, Vision and Values: > Ensure they are being discussed and modeled.

Effective Board Governance Orient, Train and Develop Board Members Develop and Implement a program to orient and train new board members. Implement programs to build members’ skills and capacity. Ensure board participation in building skills. Constantly recruit and groom future board leadership.

Effective Board Governance – Building Better Boards Right Mindset: Continuous Improvement Right Roles: Level of Engagement Right Work: Actual and Desired Areas of Engagement Right People: Knowledge, skills, Style Right Agenda: Focus on Strategic, Generative Right Info: Too little, Too much Right Culture: Norms, Beliefs, Values

Effective Board Governance – Standards of Conduct Duty of Care Board member must exercise “reasonable care” when the member makes a decision for the organization. In this case, “reasonable” is what a prudent person in a similar situation might do.

Effective Board Governance – Standards of Conduct Continued Duty of Loyalty Board member must never use information gained through his or her position for personal gain. This means each member must always act in the best interests of the organization.

Effective Board Governance – Standards of Conduct Continued Duty of Obedience A good board member must be faithful to the organization’s mission. This means the member cannot act in a way that is inconsistent with the organizational goals.

Effective Board Governance – Board Committees Board committees help to optimize individual expertise and diversity by allowing the board to use resources more effectively. By operating in smaller groups, members can accomplish more than if the board acted as a whole, particularly where issues are complex and numerous.

Effective Board Governance Category Five – CSBG Organizational Standards “…Boards are foundational to goo organizational performance and the time invested to keep them healthy and active is significant, but necessary.”

Effective Board Governance The board is legally responsible for the operation of the organization for which it serves. So, pay careful attention to the law and board duties. Doing so will help you minimize risk and ensure your organization is the best it can be.