1. Building a Better Board
Board Orientation

2. Why Board Training?
Strengthen the board’s effectiveness by providing a better understanding of the group’s roles and responsibilities to the organization and its members.

3. Topics Covered Board Responsibilities Tools for Governance
Position Descriptions

4. What Makes A Great Board?
According to a study conducted by the ASAE Foundation of more than 1,500 associations, the top performers all have the following attributes:
Strategic Focus
Commitment to Assessment and Skills Development
Effective Recruitment Process
High Participation Levels

5. Board responsibilities
Building a Better Board

6. Board Responsibilities
Governance - The phrase “governance” often refers to the Board’s activities to oversee the purpose, plans and policies of the overall organization
Establishing the overall plans and policies
Ensuring sufficient resources (financial and personnel) for the organization
Ensuring compliance to rules and regulations
Representing the organization to external stakeholders, etc.

7. Board Responsibilities
As a member of your organization’s board of directors, you have been chosen by your peers as a leader
You may have been just elected or you may have been involved in a leadership position for years
In either case your job is very important

8. Board Responsibilities
In your role as a board member you are responsible for considering the overall needs of the membership
A board member’s primary role is to establish direction and set policies and goals for the association

9. Board Responsibilities
Legal Responsibilities
Fiduciary
Duty of Care
Duty of Loyalty
Duty of Obedience

10. Board Responsibilities
Fiduciary Responsibilities: The board must ensure that the organization operates in a financially responsible manner. This includes but is not limited to:
Development and continual monitoring of a financial budget
Avoiding a deficit
Insuring the collection and remittance of required payroll deductions (income tax, UI, etc.)
Ensuring that none of the resources of the organization is used for the personal gain of officers and directors
Maintaining financial records
Appropriate use of organization’s cash reserves

11. Board Responsibilities
Duty of Care: The board must insure that practices are in place to reduce the risk of harm to its employees, volunteers and clients
Meaningful oversight (not management) of the organization
Monitoring of finances
Reliance on experts
Business judgment rule

12. Board Responsibilities
Duty of Loyalty
Act only in the “best interest” of the organization
Cannot use your position as a director for individual personal advantage
Primary relates to
Conflict of Interest
Confidentiality

13. Board Responsibilities
Duty of Loyalty (cont.)
Conflict of Interest
Any activity that may give rise to bias or influence the decision of the individual, or
Any activity that may create an unfair competitive advantage for an individual or outside organization
Adopt a Board policy on conflict of interest and external activities
Managing a conflict of interest:
Disclosure to the Board – Annual Report Form
Refrain from the discussion and/or voting on the matter
Refrain from participation in activity while serving on the board

14. Board Responsibilities
Duty of Loyalty (cont.)
Confidentiality
Nondisclosure or use of information that you receive by virtue of your position.
Directors should not disclose any information about the organization, its activities, or programs unless it is already known or available to the public

15. Board Responsibilities
Duty of Obedience
Board Education
Knowledge to understand how to interpret the association’s financial statements
Assess the level of risks the association faces in its day-to-day activities
Bylaws and Policies
Financial management practices
Human resource or personnel management practices
Personnel safety and client care practices
Conflict of interest policy
Board confidentiality

16. Board Responsibilities
Duty of Obedience (cont.)
Monitoring of Performance
Regular review of income and expenditures (actual compared to budget and explanation of significant variances)
Annual review or independent audit of financial results (financial statements)
Review reports on activities (i.e. monthly executive director’s report)
Monitor implementation of key policies
Executive/Management Company
Board of Directors

17. Board Responsibilities
Other Considerations
Insurance
Directors & Officers Insurance
Protects against actual breach of “duty” by board members
Pays for wrong decisions
Generally includes: actual or alleged acts or omissions, errors, misstatements, misleading statements, neglect or breach of duty by board members or officers
Fraud Insurance
General liability insurance
Protects a company’s assets and pays for obligations
Covers the cost of your legal defense and any settlement or award should you be successfully sued
Work with your insurance broker to find a policy that best suits your organization’s needs

18. Tools for governance
Building a Better Board

19. Tools For Governance Board Manual
For new board members the manual serves as a handbook that provides useful information about the organization, board structure and operations, fellow board members and staff
For others the manual becomes an indispensable working tool and a central resource about the organization and board
Every board member should have access to the manual
Manual should be updated regularly

20. Tools for Governance Board Manual (cont) General Information
Mission, Vision and Values statements
Board member listing and positions
Board member terms
Responsibilities and position descriptions
Committee and task force descriptions
References
Articles of Incorporation
Bylaws
IRS Determination Letter
Past board members

21. Tools for Governance Board Manual (cont.) Meeting Minutes (recent)
Board Policies
Potential conflicts of interest
Insurance policy coverage
Legal liability policy
Fraud insurance coverage
Travel/meeting expense reimbursements

22. Tools for Governance Board Manual (cont.) Finance and Fundraising
Most recent audit report
Current annual budget
IRS Form 990
Banking resolutions
Investment policy
Monthly financial reports

23. Tools for Governance Board Manual (cont.) Other Information
Staff listing (if applicable)
Annual calendar
Website information
Promotional material (i.e. membership brochure)
Organization’s products and services

24. Tools for Governance The Strategic Plan
Mission, vision and values position of the organization
Goals (usually 3 to 4) are core competencies of organization
Strategies should be fresh approaches to advance the goals
Tactics and action steps are the realm of committees and staff
Plan is realistic, based on capacity
Spans a period of 3 to 5 years
Plan is a working document and should be open to constant review and adjustment, when needed
Organization’s budget should be tied to the strategic plan

25. Tools for Governance Always:
Evaluate usefulness of all governance tools
Read and ask questions about the material
Keep each item brief

26. Position descriptions
Building a Better Board

27. Position Description Executive Officers
Organization officers have special duties described in the bylaws
Officers make of the “Executive Committee”
The Executive Committee may meet in between meetings of the board as needed

28. Position Description - President
Principal elected officer
Oversee board and executive committee meetings
Work in partnership with executive director to insure board resolutions are carried out
Call special meetings if necessary
Appoint all committee/task force chairs and with executive director, recommend who will serve on committees
Assist executive director in preparing agenda for board meetings.

29. Position Description - President
Oversee strategic planning process
Assist the society in conducting new board member orientation
Work with nominating committee to recruit new board members
Act as spokesperson for the organization
Periodically consult with board members on their roles and assist with performance assessments

30. Position Description – Vice President/President Elect
Attend all board meetings
Serve on executive committee
Carry out special assignments as requested by the president
Understand the responsibilities of the president and be able to perform these duties in the president’s absence

31. Position Description - Treasurer
Attend all board meetings
Maintain knowledge of the organization and its goals and objectives
Understand financial accounting for nonprofit organizations
Serve as chair of the finance committee
Work with chief executive to ensure that appropriate financial reports are made available to the board on a timely basis
Present annual budget to the board for approval
Review monthly financial reports and present to BOD

32. Position Description - Treasurer
Review the annual audit and answer board members’ questions about the audit

33. Position Description - Secretary
Attend all board meetings
Ensure the safety and accuracy of all board records
Review board minutes
Provide notice of meetings of the board and/or a committee meeting when notice is required

34. Position Description – Immediate Past President
Traditionally serves as chair of the nominating committee
Performs such other duties delegated by the board of directors or assigned by the president

35. Position Description – Board Member
Attend all board and committee meetings and organization functions
Review agenda and supporting materials prior to meetings
Work as a team and support board decisions
Be informed about the organization’s mission, services, policies and programs
Monitor the performance of the organization in relation to the objectives and core values
Approve the budget and monitor performance

36. Position Description – Board Member
Abide by the bylaws, code of conduct and other policies that apply to the board
Establish, review and monitor policies that guide core operational practices (i.e. financial management, human resource management
Participate in the hiring and releasing of the executive director

37. Thank you for serving on the board!
Final Thoughts
The board experience should be a positive one
The board is the caretaker of the organization
The board speaks as a whole, no board member should have more input or authority than others
Use business sense; be respectful at all times
Realize you “represent” the organization
Always ask questions as they arise (due diligence)
Always exercise diligence in following association bylaws, policies and best oversight practices
Thank you for serving on the board!

38. Additional Resources
American Society of Association Executives (ASAE) -
Board Source –
Bob Harris (The Nonprofit Center) -

39. For more information contact: Kimberlee Berry: kberry@ieci.org
Thank you!
For more information contact:
Kimberlee Berry: