Board Work

I’m in my hotel room in Lakeville, Connecticut. Right on the New York border. Soon, I’m heading over to  Women’s Support Services in Sharon.

I’m WSS’s strategic planning consultant. Yesterday I was doing sessions with board committees. Today, some more. And I just have to share some of the very smart stuff I’m hearing. Very smart, indeed!

— On every board meeting agenda, WSS includes a “board meeting principle.” They talk about a particular principle of good governance. What it means. Why it matters. Whatever.

How great is that? Every single board meeting, they remind themselves of good governance, exploring a fundamental principle of good governance. I think that is so cool.

— “Let’s renew our vows annually. “ Dick said that. He reminded me that he is a pastor. His great point: Every year, each board member should reaffirm her or his commitment to the performance expectations. And what a wonderful way to say this. Renewing my vows to the organization, to its mission and vision and values. Renewing my commitment to fulfill the performance expectations. I vowed all this when I agreed to serve on the board.

— So what does a committee do? How is it different than the board? How does the committee make sure it doesn’t disempower the board – or just ask the board to rubber stamp committee decisions.

Maria observed that committees don’t make decisions (or certainly shouldn’t!) Committees process in more detail. They may recommend. But the governance committees of the board – they don’t make decisions.

Then Steve used this good language: Committees are part of oversight and control. (I talk about committees helping the board fulfill its due diligence functions.)

Steve went on to say that a major role of any committee is to educate the board and its individual members regarding their responsibilities —  and how to interpret information in a way that allows the board to own its accountabilities and board members to ask important questions.

Thank you, Women’s Support Services. Darn good work! And thank you for your commitment to creating a community free of domestic violence and abuse.

I’ve always been curious about the concept of “the annual meeting.”

The primary purpose of an annual meeting is to elect board members. If the board elects its own members (e.g., there are no other “members”), then the annual meeting is just a regular board meeting. The board elects its members and its officers. There is the usual financial report and the usual due diligence that happens at any board meeting.

If you have members other than board members, then maybe the members elect the board members and the board elects officers. So you might have a separate annual meeting. I HATE THAT! I dislike members electing board members. I dislike members having any role in governance.

When I say “dislike,” I mean my professional opinion based on my work in nonprofits: my expertise in governance and fundraising. For me, “member” is another term for “donor.” Some organizations and professionals think that “member” sounds more like ownership than “donor.” I think that’s a rather sad testament to our treatment of and view of donors. But whatever…

Members are donors are members. So whether I buy a membership or give a gift, I am an investor and members and donors should get the same “benefits.” And for some organizations, that “benefit” is voting for board members.

But honestly, if you want to have members and call them members and they are your donors… You do NOT have to allow them to elect board members. Your members/donors don’t know who would be a good board member. Your members/donors don’t know about what you need in governance.

Further more, it’s fairly typical that not very many members/donors attend the annual meeting. Really, how interesting can an annual meeting be — unless you design a really good thing with really interesting speakers.

Those members/donors don’t need a vote. There is no useful purpose. Donor-centrism and relationship building are what build donor/member loyalty…not electing board members. (Even the power of electing a president doesn’t motivate U.S. citizens to go vote. The U.S. has one of the lowest voting rates of any democratic nation in the world.)

So change your bylaws. Members don’t elect board members. (Oops. Maybe your bylaws can’t be amended without members voting. Gosh. What a mess. Fix it. You can.)

If you want to have an annual gathering of your members/donors/friends, that’s cool. Talk about your mission, have an interesting speaker, invite a donor and client to speak. Show images of great stuff that members/donors/friends produced. Whatever. Call it an an annual meeting to report to your investors (members/donors/friends). Mingle and schmooze and nurture relationships. Talk about impact – of members/donors/friends.

In June 2013, I attended the 179th Annual Meeting of Children’s Friend. I was there because the agency was honoring a dear friend of mine. I arrived a bit late so the meeting had already started. But here is what I saw and heard.

First, there were 200+ people in the room sitting at round tables. I asked one of the staff, “How in heaven’s name do you get this many people?” The response: “These are all our employees, all our board members, our policy council, and dear friends.” (I forgot to ask if they invite their donors. But I’m hoping they do!)

Children’s Friend brings together all its employees four times per year. They close the agency and bring together employees for trainings and talking and the annual meeting. I don’t know how many employees Children’s Friend has, but at least 100, I suspect.

The President and CEO made wonderful remarks about the health of the agency, public policy and advocacy work, the impact of the agency’s work. A wonderful slide show presented 2012-2013 highlights. Photos of donors and the kids and families served and agency events and staff doing lots of things and and … The audience laughed and applauded and called out.

Then there were the awards.

• Employee service awards for 5, 10, 15, 20, and 25 years of employment. Everyone came up on stage. Everyone had his/her face on the big screen with a mini bio.
• Special tribute to a wonderful volunteer who had recently died. His wife and daughter were there.
• And the annual award for service to the agency. That’s the award my friend received.

What was the ambiance in this room? Happiness. Pride. Respect. Joy. Fun. People were cheering and laughing. People were happy. Smiling faces. Mingling and hanging around.

I don’t remember if there was voting for board members by all those people attending. To me, this gathering was a celebration, a marvelous cultivation event.

Think about it. What is your intent? How you can best achieve that? Why have members involved in governance? Why confuse governance with cultivation? Think about it. Maybe a change is in order for your organization.

Here’s how Arthur Meyers, Russell Library (public library of Middletown, CT) describes his board chair: “She brings great empathy and expertise as a person and as a business adviser and coach.  She is clear, sensible, patient, direct, organized, good listener, involved in community, able to laugh easily.”

Wow. How great is that!

Your board chair just might be so great that you want to clone her for the future. Or at least use her as an example and model for what you constantly and consistently seek.

Your board chair could be just sorta okay kinda. In my experience, most board chairs are sorta okay kinda.

And, yes, there are just plain bad board chairs. Just like there are just plain bad board members.

The goal is to pick the right board chair in the first place. Firing a board chair is hard – harder than firing a lousy board member. (But sometimes firing is necessary. If that’s the case, do it. Launch the process. See my book Firing Lousy Board Members – and Helping the Others Succeed, from Charity Channel Press.)

Selecting officers requires the same level of work  as selecting board members. This is serious business! You need a job description for the board chair.  You must outline desirable behaviors and skills. (And have a chat about what you do not want in a board chair, too!)

The Governance Committee needs honest conversation, facilitated by the committee chair and the CEO. The Governance Committee must be insightful and courageous…because that’s the group that facilitates board health, and the screening and recruitment of board members and officers.

You need board conversation about the job of the board chair, the expected behaviors and necessary skills. And, of course, the board itself must demand this level of focus and care from its Governance Committee.

And always remember, the CEO plays an important role as an enabler of committee and board conversations. (See my handout about enabling. Read all the details in Strategic Fund Development, 3rd edition.)

So what’s the job of the board chair?

• First, the board chair serves as a facilitator. She chairs board meetings and manages the conversations. She summarizes what she is hearing in order to help the conversation go forward. She ensures equal voice. She facilitates the decision-making process through motions and voting.
• The board chair helps people distinguish between personal opinion (which is often irrelevant) and professional expertise. He helps board members – and the board as group – understand and perform accordingly.
• The board chair partners with the CEO to ensure that the board and its committees do not venture into management.
• Together, the board chair and CEO facilitate the proper relationship between the board and its committees. (And the CEO makes sure that his/her staff who work with board committees understand the distinctions between governance and management – and effectively enable board members and committees.)
• Together, the board chair and CEO develop board meeting agendas.
• Together, the board chair and CEO identify committee chairs and assign each board member to the appropriate committee.

Who has the power?

The board has the power. Not the board chair. Not the CEO. Not any other individual. Governance is a group process. The group decides.

If your board members are so weak and ineffectual that they can’t pick the right board chair and demand appropriate behavior from the board chair… then the responsibility and accountability belongs with the board.

Remember, the board is important. Governance is important. The board chair can be helpful, harmful, or just really mediocre. Wouldn’t you prefer helpful? Wouldn’t you appreciate great? Get to work now. Create a shared understanding of great, okay kinda, and just plain bad. Then work together to get the best.

What do you think of this description for the board chair’s role? Dean (Cohort 22 at Saint Mary’s University) and I drafted this together.

Here’s how we begin: The primary role of the board chair is to facilitate the governance process. While the board chair has no more power than any other board, he or she – along with the CEO – is ultimately responsible for ensuring that the integrity of the governance process is maintained in all board proceedings.

But upon further reflection: Do I really think the board chair is primarily responsible for good governance? Actually, I think it is the board’s role to ensure good governance. And the board chair helps facilitate that process.

Then Dean and I came up with various functional areas, e.g., interpersonal, operational, and community.

1. Interpersonal functions of the board chair

• Empowers all board members and board committees.
• Empowers the administration to work enthusiastically in support of mission. (Hmmm… Really? Or is that mostly the CEO’s role?)
• Ensures board members and the board (as a group) feels a deep commitment to mission and community. (Hmmm… Commitment is really an individual thing. Internal motivation. The board chair and CEO can certainly help. But ultimately, the individual is responsible for his or her own commitment and performance.)
• Ensures that board members feel valued and respected. (The board chair can help. But each person has to value and respect others.)

2. Operational functions

• Facilitates effective meetings.
• With the CEO, creates the board meeting agenda.
• With the CEO, appoints committee chairs and appoints board members to various committees.
• Serves ex-officio on all committees but is not required (nor expected!) to attend all meetings.

3. Community

•  Supports and advocates for the organization and its leadership team.
• Demonstrates leadership in fundraising

Read Adrian Sargeant’s article in Summer 2013 Nonprofit Quarterly. “Donor Retention: What Do We Know and What Can We Do about it.” And then do it!

Dip into the Agitator series on Donor Retention. Embrace that, too!

Compare your board’s performance to Board Source’s  Nonprofit Governance Index 2012. Yes, it was published in September 2012. But refresh your memory!

Now take a look at NPQ‘s online article by Rob Meiksins, “Is Dr. King’s Dream Realized? Not on Boards.”

Check out “Missing Pieces: Women and Minorities on Fortune 500 Boards.”

And then, read Delia Ephron’s 09-07-13 New York Times piece, “You Can’t Have It All, but You Can Have Cake.” A commentary on having it all (which may be a particularly American perspective).

I recently read a nice little book called Focus on Sustainability: A Nonprofit’s Journey. (When I say “little,” I mean short and good. It’s a compliment!)

The book is authored by Dennis G. McMillian of Alaska’s Foraker Group. The Foraker Group is a nonprofit support organization that helps create strong nonprofits in Alaska. The Foraker Group does things like training, consulting, research, and so forth.

Foraker reminds us that sustainability is not just financial! In fact, the book notes that funding “may not be the most important element.”

Focus on Sustainability presents four interconnected factors that are “integral to a sustainable organization.” Focus. Right people. Partnerships. Unrestricted funds.

I like these four factors. Quoting from the book:

A sustainable organization can be identified through four lenses:

1. Focus: A sustainable organization maintains a laser focus on its founding principles and exercises discipline based on those principles in all its strategic decisions. At the same time, a sustainable organization must look ahead and adapt for the future.
2. Right people: A sustainable organization has the right people in the right roles. Specifically, it counts on the right board and staff, who work together effectively as partners.
3. Partnerships: A sustainable organization increases its impact through partnerships with other organizations.
4. Unrestricted funds: A sustainable organization maintains sufficient unrestricted funds to take advantage of opportunities and handle emergencies.

This book is actually short enough that you could expect all your staff to read it. You could even get some of your board members to read it.

Read the book. Just visit Amazon.

P.S. Foraker is a big mountain in Alaska…really big…the fourth highest peak in the United States…named after Ohio Senator Joseph B. Foraker, in 1899.

You might remember the blog below, from December 2012. A brief conversation between Tom and Simone. Well, Tom just sent out an e-news that explores this issue a bit more. Read my blog below. Then read Tom’s newest e-news, “Major gifts or more gifts: Which is better?”

Remember the Pareto Principle, 80/20? And now we know that, at least in a capital campaign, the rule is more like 90% of gifts come from 10% of donors. I want more love than that. I want more donors. I want that broader base. I want that broad base of donors to demonstrate community support. I want a broader base because I believe that philanthropy can (and should) be a democratizing act. I want that broader base to be so loyal that they will give bequests. Loyalty from many. That’s what I want.

So read the old blog below. And read Tom’s e-news. Think about it.

“The rich are irrelevant,” said Tom back in December 2012. And so started a very interesting conversation.

Tom is my life partner and a donor communications expert. We often talk about our shared experience in philanthropy and fund development. Our respective work takes us down similar paths, often diverges, and then reconnects. This philanthropy thing is our life’s work – each of us along and both of us together.

“The rich are irrelevant,” Tom repeats. “You and I are not interested in the rich people. We aren’t interested in the money and the transaction.”

“Instead,” Tom continued, “you and I see giving as the chance to balance the scales of selfishness. Of course, all humans are selfish. Our own biology demands self-care, self-protection, fighting for our own safety and our own way of living. And if history isn’t enough to show us this selfish truth, neuroscience now documents our selfishness.”

Tom continues. “Of course, human beings are insightful enough to know that we’re built for selfishness. Neuroscience proves this, too. So we try to balance the scales of selfish and unselfish.”

Think about it. People balance the scales of selfishness by giving. Giving friendship. Giving advice. Offering time. Investing money.

Philanthropy, voluntary action for the common good, is one way we balance the scales…selfish…unselfish.

But fundraising gets off track. Too often, fundraising focuses on money. Fundraisers and their organizations (too often desperately) search for money…and the bigger the bucks the better.

The bigger the bucks the better. “Fundraisers and their organizations keep searching for the top of the pyramid,” Tom said. “They don’t spend enough time moving the base up.”

Ah yes, the pyramid – and its top. The pinnacle of the pyramid where so few donors reside. And fundraisers focus on the top. Fundraisers and their organizations keep looking up. Too few fundraisers pay too little attention to too few people.

The fundraising pyramid focuses on the rich. The pyramid devalues people. Ascending the pyramid forces fundraising into a particularly narrow focus, big bucks – and only the rich have those big bucks.

There’s an irony in the pyramid…that the people at the top are special and better. The pyramid gives off a certain echo…royalty, for example. Slaves built the Egyptian pyramids for the pharaohs. Talk about “better” and “special!”

Why do we call it a “pyramid?” At least we could call it a “triangle.” There’s no negative echo with a triangle. Maybe we could somehow and somewhat avoid what I call “philanthropy’s moral dilemma” if we called it a triangle.

But more importantly, aiming for the top of the pyramid – or even the triangle – is so limiting. How about we re-conceptualize? Visualize the triangle with a big bulge somewhere in the middle, above the base and below the pointy top. Maybe the bulge looks like cloud cover surrounding the middle of the mountain. Maybe the bulge is like a big donut pushed down over the top, settling around the middle section of the triangle.

“A bequest is usually the largest gift a person ever makes,” noted Tom. And fundraisers know that loyal donors (not necessarily rich ones!) make bequests.

What if fundraising focused on rejecting the pyramid, embracing the triangle, and building the bulge?

What if fundraisers spent more time and energy and expertise and experience moving the base of the triangle into a big bulge right in the middle? Sure…if you can get to the top, go for it. Embrace the rich. Just don’t focus on them.

What a luxury for Tom and me. We can encourage our clients – and those who read our writings and attend our workshops – to transition from pyramid to triangle. We can promote a big bulge.

Yes, the rich can be irrelevant.

P.S. Watch for Tom’s e-news. I suspect he’ll be talking about our talk, too.

I’ve just added two new items to my Free Download Library on my website:

• Version #2: Role of the Board
• Version #2: Board member performance expectations

Versions #1 are still there. But I’m always thinking of new ways of saying things. And thinking of new things that are important.

So visit the Free Download Library and check out these new versions. 

And always remember the following:

1. There is a difference between the board and the individual board member. These are NOT NOT interchangeable words.
2. The first responsibility of the individual board member is to participate in the governance process. That’s what it means to be a board member. Go to board meetings, etc. etc. In Version #2 of the board member performance expectations, I’ve pulled together all the activities of being a board member.
3. But the board member has another obligation – beyond corporate governance. I expect the board member to be a key volunteer, a leadership volunteer. So you will see assorted performance expectations for board members that happen beyond and outside of corporate governance. In Version #2, I’ve separated these to indicate that these activities are not part of governance but are equally important and non-negotiable.

I hope you find these new versions useful and helpful.

People can learn – and must. Organizations can change – and must. Workshops can help. Reading the right books and bloggers can make a difference. Good conversations – with disagreement – can help. What are you doing to learn and change?

On March 29, 2013, I had the honor of serving as keynote presenter for the third annual East Bay Forum hosted by CompassPoint. The focus of the forum … UnderDeveloped: A National Study of Challenges Facing Nonprofit Fundraising.

More than 100 nonprofit organizations, mostly in the East Bay, attended…including development officers, executive directors, and board members…mostly teams from the same organizations. That’s the way to build understanding, learn and change – bring a team from the organization. Make sure that the team talks and then helps design and facilitate change in the organization.

Within 24 hours, I received an email from a consultant attending the session with one of her clients. Here’s what she said: “I am working with a small non profit to do a development audit and create their fund development plan. They have a lot of development challenges.
“I emailed the ED the study (the UnderDeveloped Report) a few weeks ago and she read it but did not quite get the full understanding of all that was lacking with her organization for successful fund development .
“But then she went to the workshop on Friday and today I was at their board retreat and she could not stop talking about the workshop. She said ‘I have never been so beat up in a four hour workshop and felt so great!’
“Now she gets it and the board chair is starting to understand and they both see that the board needs to be involved in fund raising and the role of the DD and investing in long term donor cultivation etc.
“So I am so inspired that this study and the workshop can have an impact and that DD/ED and board can make changes with the right information and commitment!”

How wonderful. That ED heard the problems identified in the report. She recognized her organization’s challenges. She understands that the organization can learn and change. Ask yourself: Do you know your organization’s problems? Are you prepared to face the challenges and learn and make change? Can you enable your staff colleagues, board members, executive director (if you are the development officer) to see the challenges, follow the body of knowledge, and make change?

It was a great morning there in the east bay of California. It was, of course, tough love day. Most days are tough love day with me. I love and respect the nonprofit sector and its role in community and democracy. But there is lots to fix for the nonprofit sector to be stronger and produce greater impact. Changes in fund development. Changes in governance. Changes in executive leadership.

Now is the time for your executive director, develop director, and management team to read UnderDeveloped. Read my January 3-part blog in response. Your fund development committee needs to read the study. And your board, too. Talk about the implications. Figure out how to fix this!

For help with change, visit the Free Download Library on my website. Read Simone Uncensored, my blog, and subscribe to my e-news. You will receive regular tips and ideas about how to be stronger, raise more money, and engage a top-notch board in top-notch ways. Maybe you’ll need consulting help. So find a good consultant.

Just do it, as Nike says. A trite phrase these days. But nonetheless. Do it. Fix yourself. Be all that you can be. You know what I mean!

A colleague told me about a board meeting he observed. Here’s the scary story, in his words: 

“The board chair mandated order. And when I say ‘mandated,’ I mean it. It was tempting to allow my jaw to stay on the floor because as soon as I picked it up, it would fall once again.

“The board chair, with some input from the Executive Committee, ran a fairly dictatorial board. Those were not part of the inner circle – i.e. didn’t serve on the Executive Committee – felt excluded and angry.

“The meeting was heated and the lack of transparency and tension due to exclusion was immense. The board chair got more heavy-handed and more secretive as the excluded board members asked more and more questions.”

What an awful story – but more usual than one might suspect.

What went wrong? A rogue board chair who thinks he controls everything. An executive committee that thinks it controls everything that the board chair doesn’t control.

My advice: Disband the executive committee immediately. Join my worldwide mission to destroy all executive committees. By the way, it’s the board’s decision whether to have an executive committee.

Give feedback to the board chair about his performance. Remember, no board member – including the chair – has more authority than anyone else. At board meetings, speak out. Ask for what you want as board members. Express concern about dictatorial and exclusionary behavior.

If necessary, ask the board chair to resign. Recruit a new board chair who is a good facilitator.

Do you need some resources to help you understand this work – and then do this work? Visit the Free Download Library on my website. Click on Board Development. Then read the many free PDFs located there. Things like: Basic Principles of Governance. Destroy All Executive Committee. Firing Lousy Board Members. Sample Policy for Board Operations. Performance Expectations of the Individual Board Member. My due diligence outline. Questions for building the best board. And more.