Structuring a Board in a Not-for-Profit
By CCVO Guest Blogger Robin Butler, Supervisor NPO Division, Baker Tilly Catalyst
Structuring a Board is a strategic and in-depth process. Many Boards consist of professionals in other sectors or positions that serve on a Board on a volunteer basis. Sometimes it can take a couple of attempts to create the perfect scenario.
A Key element one should look for in a Board member in a director position is that they have an understanding of the mission of the not-for-profit and are ready and willing to donate the time required. Many technical things, like governance practices, can be taught after the director has committed. There are many resources to assist with this type of training including the website www.BoardSource.org.
When forming a Board, it is beneficial to look for a variety of individuals with relevant background knowledge to guide the organization to success. These important roles include:
Financial Director: Whether this is someone with a public or private accounting background, or someone with experience reading and understanding financial statements, it’s important to include at least one member who can guide the financial portion of the operations.
Legal Director: Ideally, a Board should include someone with background knowledge of laws and regulations. This ensures that any potentially contentious items can be resolved by the Board prior to being publicly announced or brought into effect by the organization.
A Director with knowledge in the sector of the Not for Profit forming the Board: One should bring people into the Board with a good idea of the targeted sector, to help navigate roadblocks and issues as they arise.
A Director with management or human resources experience, or both: As organizations grow, the executive director and CEO will need more support from the Board to ensure they are meeting the increasing needs. Additionally, one of the responsibilities of the Board is to evaluate and hire executive directors or CEOs. This is much more efficient with someone with this experience on the Board
Other important skills that are beneficial to a Board include Information Technology (IT), Public Relations, Marketing, Strategic Development and Risk Management.
It’s also important to keep in mind the responsibilities that a Board has to keep the Not for Profit in good standing. Responsibilities include:
Legal duties:
Duty of Care: Ensure prudent use of assets and people
Duty of Loyalty: Ensure the not-for-profits activities advance its mission. Disclose any conflicts of interest. The individual must also make decisions within the best interests of the organization rather than the best interests of the individual.
Duty of Obedience: Ensure the not-for-profit obeys applicable laws and regulations and follows its own bylaws. Additionally, the Board member ensures the not-for-profit sticks to the Mission Statements and Organizational Purpose.
Provide general guidance and support to the Organization in terms of strategy, culture, financial sustainability, etc.
Act as ambassadors and advocates for the not for profit
Develop and maintain organizational policies
When structuring a Board it is also of utmost importance to diversify its members. By recruiting Board members who reflect the diversity of the community in which the Board operates, a Board strengthens its leadership position and ensures that all members in a community are being represented. This is particularly important when furthering social causes. Diversity includes gender identity, race, age, sexual orientation, and more.
There are many viable and dependable individuals looking to give back and serve on Boards of Not-for-Profits. Keeping in mind the above tips when structuring or restructuring a Board will help organizations put together the best possible Board to help carry out the mission of a Not-for-Profit.
About Baker Tilly Catalyst
Baker Tilly Catalyst works extensively with Not-for-Profits and registered charities on all accounting-related matters including bookkeeping, financial and tax reporting, audit support and senior financial professional outsourcing (CFO support). They also host virtual roundtable sessions to assist charities with their operations.
With a team of dedicated specialists in this area, Baker Tilly Catalyst becomes a key member of the Not-for-Profit or registered charity’s team to align performance and organizational goals.
Feel free to contact Robin at 403-767-1546 or rhbutler@bakertilly.ca