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What Is the Best Structure for Your Nonprofit Board?

Antoine

In any organization, the nonprofit board of directors is key for defining internal and external policies and procedures, strategies and making integral decisions to further the organization’s growth. 

That is why having a solid structure for your nonprofit board is critical to facilitate competence, productivity, and optimum performance within any new nonprofit corporation. 

Throughout this article, we provide our best nonprofit tips on the best strategy for organizing your nonprofit board. 

Let’s get started!

nonprofit-board-structure-what-is

What Is a Nonprofit Board

Nonprofits are mandated to have a board of directors to oversee proper management. They are also expected to adhere to some key 501c3 nonprofit board of directors rules. As the organization's leadership team, they fulfill the three primary legal duties of care, loyalty, and obedience by fulfilling a series of tasks including:

  • Designing the purpose and mission statement

  • Hiring and oversight of the Executive Director (equivalent of a CEO)

  • Ensuring compliance with all legal requirements

  • Managing human resources, including orientation, onboarding, and compensation

  • Establishing and monitoring nonprofit programs, fundraising, and activities

  • Creating, maintaining, and enforcing bylaws and all internal and external policies

  • Reviewing, analyzing, and approving budgets and reports

  • Holding planned board meetings following an established agenda

  • Representing the organization and brand through adherence to core values, ethics, policies, and professionalism

  • Providing staff, volunteers, and other team members with the resources they need to perform their duties

  • Evolving and adapting through research and reflection

As far as nonprofit board responsibilities go, the above mentioned tasks are some of the most crucial to the stability and growth of the organization. However, to ensure they are carried out in the best possible manner, it helps to have a structure in place which promotes excellence.

nonprofit-board-structure-mandatory-members

Who Are the Mandatory Members on a Nonprofit Board?

Legally, the IRS requires a minimum of three members, although many nonprofits utilize four or more. Common nonprofit board member positions used to fulfil this requirement include the president (also called the chairperson), vice-chair, secretary, and treasurer.

Note that you can choose to compensate these members by designing a policy around your nonprofit board of directors salary, although it is not by any means mandatory. 

nonprofit-board-structure-mandatory-membersDavid has all his mandatory members in order!

Here is a brief overview of these roles that are likely to be found on your nonprofit’s board structure chart:

President

The board chair presides over meetings and supervises all operations while ensuring legal compliance. They usually have signing authority and report to the board of directors.

Vice-Chair

Providing support for the president, the vice-chair is available as a substitute in the event that the board chair is unavailable. Some nonprofits groom their vice-chair as a potential replacement in the event the chair leaves the organization to ensure smooth transitioning. 

Secretary

Tasked with reviewing or creating the board meeting minutes, the board secretary's job description involves keeping similar official documents or paperwork to make sure all topics and decisions are officially documented. 

Treasurer

The treasurer’s primary duties revolve around the financial data of the organization. 

From managing the financial documentation to presenting accurate data and information on budgets, income, and expenditures to the board, the treasurer is responsible for providing the board with the information needed to make important decisions to facilitate growth and ensure funds are being allocated wisely. 

nonprofit-board-structure-committees

Use Committees to Structure Your Nonprofit Board

An executive committee is a group dedicated to managing research, projects, and other actions relating to a specific aspect of a nonprofit organization. 

Nonprofit board governance, finance, executive actions, marketing, and fundraising, are just a few of the most common board committees that exist. Other organizations divide their committee assignments into three major categories: governance, internal affairs, and external affairs. 

Committees help structure an organization’s board more effectively. This is because:

  • Board members tend to have particular subject matter expertise. Committees allow the organization to utilize this knowledge to drive specific actions within the organization e.g., folks with marketing or accounting backgrounds.

  • Committees are very specific in their goals and specify responsibilities for those involved. 

  • Individual committees that include other staff, members, and volunteers help to ensure that board members are not spread too thin. A group of three or four people attempting to "boil the ocean" is not sustainable for the long term. 

  • By augmenting the skills on the board, members do not need to learn skills outside of their zone of expertise. For example, instead of a career marketer trying to learn the legal intricacies of nonprofit management, they can ensure people with the right expertise are on the right committees.

However you decide to assign your committees, they can prove an efficient manner to evenly divide the organization’s workload throughout the board without putting undue pressure on specific members.

As they are already generously providing their time to serve on your board, you want to make the process of project management to be as smooth and simple as possible.  

nonprofit-board-structure-committeesEmily knows the value of specialized committees!

Since each member will have their own knowledge of these projects and how well tasks are accomplished within the committee, it gives each an opportunity to present useful information at board meetings and serve as consultants for any issues relating to their subject matter. 

The rest of the board can then provide feedback and suggestions for guidance and have a better understanding of each committee’s topic. 

The structure of the committees themselves is important. Take the time to consider talents and personalities and place staff together which will create an atmosphere that is positive, motivated, and conducive to a great working atmosphere. 

As the board reviews each committee's reports and accomplishments adapt accordingly. If one committee is not meeting expectations, perform an evaluation of the staff and projects to determine possible reasons.

If there are staff relationship conflicts, make alterations to improve productivity. If you sense strife, consider meeting with each committee member separately to get their interpretation of what the issues are. Oftentimes, conflicts crop up because of a lack of, or inefficient, communication. Understanding the root of the problem from different points of view can give you a more well-rounded view and help you determine what course of action would be most effective at improving the situation for all involved. 

Pro Tip: Take the time to celebrate hard-working individuals, as well as team accomplishments and well-managed projects. This will increase motivation and make your team feel appreciated. Sharing how their efforts have made a difference in your mission and the role they have played in the grand scheme can increase productivity.

nonprofit-board-structure-adapting-structure

Adapting the Structure of Your Board Over Time

Remember that modifying and adapting to seek improvement is a natural part of the leadership process. That includes dealing with your board structure. 

One major duty of the board is to reflect on its own performance and realistically consider how well the leadership team is managing the nonprofit. Find the strengths first as a springboard for successful action, then locate areas of opportunity. 

One option is to include a standing "lessons learned" agenda item for monthly board meetings where board members can discuss both what is working well and where improvements should be made. This gives everyone a safe space. If the team builds the expectation that they want to hear where there are issues, and offers a regular time to do so, folks will feel more comfortable airing their grievances in a productive way.

nonprofit-board-structure-adaptingOliver is calculating the best way to adapt his board for the upcoming year.

Those are the areas you want to spend the most time contemplating. Have frank discussions with your board about what you all as a team can do better to make a greater impact for your mission, the nonprofit, and all the volunteers, staff, trustees, members, donors, funders, and other supporters who believe in your journey. 

Sometimes that may mean performing an overhaul of the board structure and reallocating committees and responsibilities. 

Always make these reflections with the end goal in mind and work backward. Determine what your organization needs to be, figure out where you presently stand, and work in reverse to plot the steps which can lead you there. Working with the end goal in mind is a research-proven method to help your organization realize its potential. 

For example, let’s assume that in your last board meeting, during the lessons learned agenda item, you received feedback that your most recent fundraiser was well received by your member base. The fundraising team held a trivia night at a local fire hall. Current and past members attended and everyone had a blast and the organization raised more money than they had anticipated. One area for improvement is there were a number of people who couldn’t attend but asked if there was another way they could support the organization. 

During the board discussion, the team brainstormed and decided that an accompanying silent auction would have been beneficial. That way, people who didn’t win any trivia prizes would have a second chance to take something home and members who couldn’t attend in person could still potentially participate online. The team could work backwards from the goal of having a successful silent auction to identify the steps needed to achieve the goal and then determine whether they have the bandwidth and expertise to complete each or need to develop a sub-committee to address.

Remember that all-inclusive software packages, internet templates, the IRS website, and internet resources such as Boardsource and the Springly blog, offer additional expertise on board of director strategies such as these. 

If you ever find yourself in need of external help with leadership topics, there are coaches made just for this! Sometimes an outside, objective view of your organization’s leadership, project management, accounting, or other features is just what you need. 

Pro Tip: To make sure your structure is always useful and up-to-date, you can set annual meetings to assess your results and adjust for upcoming years. This is also a good strategy for ensuring your committee members are still motivated to meet their mission goals and, if necessary, seek replacements for those who are struggling to perform.

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