Governance in Nonprofits – Ensuring the Board Knows its Boundaries

Nonprofit organisations rely on a delicate balance between governance and management to achieve their mission and maintain organisational health. The board of directors plays a crucial role in steering the nonprofit towards its strategic goals, ensuring financial stability, and upholding its mission and values. However, for a nonprofit to thrive, it is equally important for the board to recognise the boundaries of its involvement. Overstepping these boundaries can lead to micromanagement, staff frustration, and ultimately, a less effective organisation. Here are key areas where the board should steer clear to maintain a healthy governance-management balance.

1. Day-to-Day Operations

The board’s primary role is governance, not management. This distinction is critical to the success of any nonprofit. Day-to-day operations should be left to the executive director and staff who are hired for their expertise and are best equipped to handle the organisation’s daily functions. When the board involves itself in routine operational matters, it can undermine the authority of the CEO/Executive Director and create confusion about roles and responsibilities.

2. Staff Management and Supervision

While the board is responsible for hiring, evaluating, and if necessary, terminating the CEO/executive director, it should not extend this involvement to other staff members. Direct management of staff should be the sole responsibility of the CEO/Executive Director. This includes hiring, performance evaluations, and daily supervision. Board members stepping into these areas can create a toxic work environment and disrupt the organisational hierarchy.

3. Program Implementation

Board members should refrain from getting involved in the direct implementation of programs. Their role is to ensure that programs align with the organisation’s mission and to evaluate their effectiveness from a strategic level. Getting involved in the specifics of program delivery can lead to inefficiencies and divert the board’s focus from its strategic oversight responsibilities.

4. Financial Transactions and Fundraising Execution

While the board has a fiduciary duty to ensure the financial health of the nonprofit, this does not mean they should involve themselves in daily financial transactions or the execution of fundraising activities. These tasks should be managed by the financial staff and the development team. The board’s role is to provide oversight, approve budgets, and engage in high-level fundraising efforts, such as networking and leveraging their contacts for major gifts.

5. Internal Policies and Procedures

The board should establish high-level policies that guide the organisation, but the development and implementation of specific internal procedures should be left to the executive director and staff. For example, while the board might approve an overarching HR policy, the details of how it is implemented should be managed by the HR department. This separation ensures that policies are practical and can be effectively implemented by the staff who understand the day-to-day operations.

6. Public Relations and Communications

The board should not take on the role of managing the nonprofit’s public relations or communications strategy. While board members can be valuable ambassadors and advocates for the organisation, the development and execution of communication plans should be left to the staff. The board’s role is to ensure that the communication strategies align with the mission and to support the staff by amplifying key messages.

Conclusion

For a nonprofit organisation to function effectively, there must be a clear delineation of roles and responsibilities between the board and the staff. The board should focus on governance, strategic planning, and oversight, while entrusting the executive director and staff with the operational management of the organisation. By respecting these boundaries, the board not only empowers the staff but also ensures that the organisation remains mission-focused and capable of achieving its goals.

Successful nonprofit governance hinges on the board’s ability to refrain from overstepping into operational areas. This balance of power fosters a productive and harmonious organisational environment where both governance and management can thrive, ultimately driving the nonprofit toward greater impact and sustainability.