Policy Governance Round Table 2: Board Leadership Cullen Coates & Neel Lane Episcopal Community Services in America Round Table 2011 April 28, 2011

Goals of Policy Governance Initiative Create an effective structure that will guide us now Create a structure that will guide future boards and managers Help us focus better on what really matters

For-Profit Boards Measures of Effectiveness Decisions tested in the market Business results test board direction/decisions Legal duty of loyalty to shareholders Frequent regulatory guidance

Non-Profit Boards Revenues from sources other than clients Services provided at discount or for free No market to reflect consumer effectiveness No automatic danger signal Absent a market test, the board must perform that function

Common Drains on Non-Profit Board Effectiveness Time on the trivial Short-term bias Reactive stance Reviewing, rehashing, redoing Leaky accountability Diffuse authority

Goals of Policy Governance “Cradle” vision Address fundamental values Encourage external focus Separate large issues from small issues Force forward thinking Enable pro-activity – creating rather than approving Use board time efficiently

Implementing Board Policy - Mechanics Create written board policies Maintain and distribute policies Approve and embrace board policies Evaluate board actions against policies

Policy Categories Ends – what needs are to be met, for whom, and at what cost Executive Limitations – principles that limit choice of staff means – practices, activities, circumstances, methods Board Governance Process – how the board represents the clients and supporters, and how it provides strategic leadership Board-Executive Director Linkage – how authority is passed to the Director, how use of that authority is assessed

Ends Vision or Mission Statement What needs are to be met, for whom and at what cost Ends justify our existence Ends define our success

Executive Limitations Global Executive Constraints Personnel Matters Financial Planning and Budgeting Financial Condition and Activity Emergency Executive Director Succession Assets Protection Communication and Support to the Board Focus of Grants or Contracts

Executive Limitations Communication and Support to Board Shall submit monitoring data in a timely, accurate and understandable fashion, directly addressing provision of board policies being monitored Shall advise Board of relevant trends, medial coverage, material external and internal changes. Shall deal with the Board as a whole.

Board Governance Process Global Governance Commitment and Style Outward Vision Diversity of Viewpoints Strategic Leadership Clear distinction of board and chief executive roles Collective rather than individual decisions Future rather than past or present Proactive rather than reactive

Board Governance Process Board Job Description Written governing policies to ensure performance Board performance criteria includes: Attendance at Board Meetings Participation Attendance at retreats and orientation Participation in fund-raising Support of Special Events

Board Governance Process Chairperson’s Role Shall assures the integrity of the board process and may represent the board to outside parties.

Board – Executive Director Linkage Global and Unity of Control The boards’ sole official connection to the operational organization, its achievements, and conduct will be through the Executive Director. Only decisions of board acting as a body are binding on the Executive Director

Board – Executive Director Linkage Accountability of Executive Director Executive Director is the board’s only link to operational achievement and conduct.

Board – Executive Director Linkage Monitoring Executive Director Performance Organizational accomplishments of goals set by board policies Organizational operation established by board