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1: Introduction

The purpose of this book is to help boards of directors of nonprofit organizations improve their performance after completing the online board self-assessment tool found at www.boardcheckup.com. However, it can also be used as a stand-alone resource for any board seeking to enhance its effectiveness in that it contains the diagnostic questions on which the online tool is based.

The approach taken here is similar to that which lies behind health checkups for individuals. Doctors usually begin by asking us to review a lengthy list of possible health issues and we check those about which we have concerns. The doctor and patient then focus their discussions on these issues. The typical process proceeds through the following three stages:

  • Understanding the symptoms. The doctor and patient begin by trying to define the issues more clearly.
  • Diagnosis. Effort is made to understand the causes of the problems through tests and further examinations.
  • Treatment. Once the problem has been properly diagnosed, a treatment program to remedy it is begun.

While the Board Check-Up survey on which this book is based does not claim to be as scientifically rigorous as a medical examination, it is based on the same logic. It begins by having those who belong to, or relate to, boards provide their perceptions of how well the board is working by guiding them through a list of potential “health issues,” i.e. statements of possible problems, issues, or challenges that boards might encounter in their work. These statements have been derived from comments made by those who serve on boards or interact with them as well as from the work of researchers and consultants who have studied boards over the past 30 years. The process reveals both the things that the respondents feel the board is doing well in addition to those that are seen as problematic. Once issues (symptoms) have been identified, they become the focal point for discussions that explore how serious they are, what might be causing them (diagnosis), and what can be done to resolve them (treatment).

The Theory Behind the Guidelines

The conceptual framework on which the Board Check-Up is based is shown in Figure 1 below. It shows that effectiveness challenges faced by boards can be grouped in two dimensions: (a) the board’s roles and responsibilities as a governing body; and (b) the factors that influence how well the board carries them out.

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 Figure 1: Nine Elements of Board Effectiveness

Figure 1 further shows that within these two dimensions there exist nine basic sets of board effectiveness challenges. They are,

A. Effectiveness challenges related to the performance of the board’s roles and responsibilities in the governance process.

The clarity of the board’s role vis a vis management and other stakeholders in the organization’s environment;

  • How well it carries out its duty to establish the organization’s mission and the broad guiding strategic plans, priorities and general policies within which the organization should operate;
  • How clear and effective it is in carrying out its fiduciary role in assessing the performance of the organization and those to whom it delegates authority (e.g. the Chief Executive Officer) as well as its assessment of risks facing the organization.
  • How well it contributes to ensuring that the organization has the financial resources it needs to operate and achieve its mission.

B. Effectiveness challenges related to the factors that influence the board’s ability to carry out its roles and responsibilities.

Aspects of the formal structure and operating procedures of the board such as its size, by-laws, job descriptions, committee structure, information systems, and administrative support;

The effectiveness of board meetings;

  • Various aspects of the makeup of the board’s membership and how well board members are oriented and trained;
  • The role played by informal, shared attitudes and beliefs about how the board should behave, commonly known as the board’s “culture”;
  • The influence of two key people who provide formal and informal leadership to the board—the board Chair and the organization’s top paid manager or CEO, if there is one.
  • Figure 1 recognizes that, taken together, these nine effectiveness challenges influence the performance of the organization as a whole (e.g. advancement of the mission, financial condition, efficiency, ability to learn and grow, motivation of paid staff and volunteers, and the support provided by stakeholders in the external environment).

It should be noted that boards are not the only contributors to the effectiveness of the organization.

Figure 1 shows the host of contextual factors that influence the governance process and the organization’s effectiveness. Though they may often not be aware of it, a board’s behavior may be affected by characteristics of the organization it governs—for example its history, size, and the nature of its mission. The actions of external stakeholders such as funders, regulators, and other organizations in the community or industry of which they are a part are also significant. Some of them have actual legal authority over some aspects of board responsibility while others have informal, yet powerful, forms of influence. Finally, all nonprofit organizations exist within a larger society. Countries and communities can differ widely in the political and economic climates they create. Cultural values about the nature of charity, volunteering and the role of nonprofits create different environments for the NPO’s within them (see Salamon and Anheier, 1997).

For the purposes of this book we will not enter into in-depth discussions of these contextual influences on governance effectiveness. However, it must be noted that these influences are included in the Board Check-Up survey and are a focus of the larger research study of which the survey is a part. Papers produced from this research are available to registered users of the Board Check-Up (www.boardcheckup.com). Because the focus of this book is primarily practical, it will deal with the issues that challenge boards (symptoms), why they occur (diagnosis) and the ways that boards can consciously choose to improve their effectiveness in the governance process (treatment). Those interested in the growing body of academic research on the topic of contextual influences should see the 2014 Routledge Press book, Innovative Perspectives in Nonprofit Governance, edited by Chris Cornforth and Will Brown.

Organization of this Book

As noted above, this book is intended to help boards assess their own performance and make decisions to improve the effectiveness of the governance process. Each chapter focuses on one of the nine dimensions of governance effectiveness described in Figure 1. The chapter starts with items relating to that dimension on the Board Performance Self-Assessment Questionnaire. These items represent the symptoms that indicate possible issues, problems, or challenges faced by the board. This is followed by a discussion of possible reasons that such symptoms might exist (diagnosis). The third part of each chapter looks at what might be done to alleviate the symptoms once a diagnosis is made (treatment). Included in this final part of the chapter are references to websites, books, and articles that provide additional advice and assistance on how to deal with the issues raised.