The Nonprofit CEO Dilemma: How Do I Ask the Board to Improve Its Performance?
For any nonprofit organization to be successful, there must be a great partnership between the CEO and the board of directors. They must have a relationship built on mutual trust and respect, as well as open and honest communication. There must be a shared sense of accountability and responsibility to the organization and its stakeholders. And the CEO and board must be strategically aligned toward a mutual understanding of the organization’s mission and vision.
But what happens when this basic underpinning of nonprofit success falters? What if communication is inconsistent or lacking? What if the CEO and board have fundamentally differing understandings of each other’s roles and expectations? What if one partner feels that the other is not pulling their weight?
If a board feels that its CEO is not performing at the level it expects, it has the authority to develop and implement a performance improvement plan, and monitor the progress of the CEO’s success. Should the situation continue or worsen, the board can fire the CEO and seek a replacement who will, hopefully, meet its requirements and expectations.
But what can a nonprofit CEO do if they feel that their board is not performing at the level required to sustain the organization’s mission and achieve its vision? The board can fire the CEO, but the CEO cannot fire the board. Herein lies the nonprofit CEO dilemma.
If you are a nonprofit CEO, you know that most of the people who serve on your board are well-meaning and care about your mission. They are generous with their time, volunteering to make a difference in the lives of those you serve. They are good citizens and often pillars of the community. It is likely that you invited them to join your board because they have a talent and a track record of success. But it is just as likely that those who join your board won’t fully know what is expected of them in their new role, how they will be supported in meeting these expectations and how they will be held accountable by your board’s leadership.
After a successful 25-year career as a medical center and foundation president and CEO, and managing director of a publicly-held company providing consultancy to numerous nonprofits, I founded my firm 16 years ago to help nonprofit leaders and boards raise their performance to better achieve their missions. I have observed a great many things about how nonprofits succeed (or don’t), and chief among them is this: Most people who agree to serve on a nonprofit board are wonderful people who have very little experience serving on a board and receive very little training while serving on them.
In addition, few organizations provide any ongoing level of board training and education beyond a brief period of board orientation — generally limited to a few hours spent meeting with members of the executive leadership team and being provided with the organization’s bylaws, strategic plan and most recent audited financial statements. A few will receive a tour of the facilities and be provided with a board manual of information, which most will never read beyond an initial glance because of their busy schedules.
New recruits to the board are generally excited to serve and look forward to attending their first meeting. Upon entering their first board meeting, they find an empty seat and sit and wait to see what happens next. Before long, they might be asked to vote on a board resolution. Being new to the organization and lacking experience as a nonprofit trustee, the individual will likely follow the lead of the others when asked “all in favor say aye.”
Without any kind of ongoing board education, the new board member will struggle to fully understand their role, or to find their voice as a member of your board. Their experience, as well as their performance, will be lackluster.
Most organizations — for-profit and nonprofit alike — would never consider hiring staff without providing initial and ongoing training. Many professions require a specified number of continuing education units, or CEUs. Most states now require those who serve on their local or state boards of education to meet CEU requirements. So why don’t we require those who serve on our nonprofit boards to receive some level of training? Why don’t we make a commitment to provide training to those who agree to serve on our boards?
I can think of six common reasons:
- Nonprofit executives assume incorrectly that board volunteers’ professional backgrounds and status in the community are sufficient preparation for a nonprofit board role.
- Board volunteers themselves assume that their own professional backgrounds and status in the community are sufficient preparation for their nonprofit board role.
- Boards and executives alike worry that training requirements would become a barrier to any potential new member, making the already-challenging board recruitment effort impossible.
- When budgets are being developed, board training is not seen as important enough to warrant investment of already scarce resources.
- Board members are often recruited based on a single dimension — their expertise in a particular area, their connection to a particular corporation or social circle, or their potential to make a significant philanthropic contribution, as opposed to holding strong as requiring a combination of time, talent and treasure.
- Nonprofit CEOs are not often fully versed in board governance best practices themselves.
Over the course of performing hundreds of board and organizational performance assessments requiring conversations with thousands of board members, I have observed something else: Most board members would welcome the training.
Board members want to be positive contributors to their organizations. They feel frustrated and disengaged when the board does not perform well. When the board is not performing well, fundraising suffers; and when fundraising suffers, it can be hard to focus on anything else. Oh — and it does not automatically follow that just because board volunteers are successful as business or community leaders, they will have any real knowledge or experience with philanthropy. Most board members “would rather have a root canal than raise money.” Further, boards that do not perform well develop a poor reputation in the community which then has a negative impact on board recruitment. The cycle continues.
The solution to the nonprofit CEO dilemma is for the board leadership and CEO to realize that they have the shared responsibility to provide an ongoing program of board education and training. It can take years for a new board member to feel a sense of self-confidence in their leadership role, to know what is expected of them and to know what it takes to succeed as a board member.
My goal is to encourage every nonprofit organization to make a commitment right now to create a culture of high board performance. Members of boards that understand and are knowledgeable about nonprofit board governance best practices are more likely to be fully engaged and motivated. They are more likely to feel fulfilled and to find their board experience motivating. They are more willing to become active participants in fundraising initiatives. They enjoy serving on their board and cannot wait to bring their ideas and solutions to the table. Doesn’t that sound like a great way to help your nonprofit succeed?
The next time you work on developing your organization-wide leadership development program, create a year-round board governance professional development program as well. This program might include the following components:
- Signing your board members up to nonprofit leadership journals and/or online newsletters.
- Providing well-regarded books and articles on board governance.
- Inviting a professional to speak at one of your board meetings.
- Hosting an annual board retreat and including an aspect of board governance education on the agenda.
- Inviting your members to sign up for free webinars related to board performance.
- Purchasing for your members an online board training program that they can take from the comfort of their home or office.
- Inviting your board leaders to join you at an annual board and nonprofit leadership conference.
In today’s challenging times, investment in board governance training and education is time and money well spent. The ultimate beneficiaries will be those you serve.
Dennis C. Miller, the founder and chairman of DCM Associates Inc., is a nationally recognized expert in nonprofit leadership executive search, and board and leadership performance coaching with more than 35 years of experience working with nonprofit board leadership and chief executives across the country.
Dennis is an expert in board governance, leadership development, philanthropy and succession planning. He is the author of five books, including "A Guide to Recruiting Your Next CEO: The Executive Search Handbook for Nonprofit Boards."