Training Module 5: Part A The Board of Directors – Structure and Activities

1. Training Module 5: Part AThe Board of Directors – Structure and Activities Presented by the Southern Early Childhood Association

2. Topics to be Presented… • Responsibilities and structure of the Board of Directors • Board member job descriptions • Committee system design and function • The Board manual • Fiduciary duty, conflicts of interest, and confidentiality • Board attendance policies and quorums • Meeting agendas and meetings • Board information systems

3. The Board of Directors is… …the group of people legally charged with the responsibility to govern a corporation.

4. Responsibilities of a Nonprofit Association’s Board of Directors 1. Organizational Character • Determine the organization’s mission and purpose • Provide input into and approve annual and long-range objectives • With the Executive Director, plan Board meeting agendas

5. Responsibilities of a Nonprofit Association’s Board of Directors 2. Finances • Provide for fiscal accountability • Formulate policies related to contracts • Finalize and approve the budget • Approve expenditures outside the budget • Acquire sufficient resources for the organization • Solicit contributions in fundraising campaigns

6. Responsibilities of a Nonprofit Association’s Board of Directors 3. Personnel • Employ Executive Director and approve staffing decisions • Plan and propose committee organization and appoint committee members 4. Program Assessment • Monitor achievement of specific program goals and objectives • Oversee evaluation of products, services and programs

7. Responsibilities of a Nonprofit Association’s Board of Directors 5. Public Relations and Recruitment • Represent the organization in the community and help network the association with other organizations • Recruit new Board members

8. * DISCUSSION * • What responsibilities are assigned, either formally or informally, to your association’s Board of Directors? • Do these responsibilities ensure that all association needs are met, or are there other duties that should be delegated to the Board of Directors?

9. The Structure of the Board of Directors • How large should the Board of Directors be? - Examine organization needs • What should be the length of a Board member’s term? - Aim for institutional renewal

10. The Structure of the Board of Directors • What committees should the Board of Directors authorize? - Executive, program, finance, conference • How should committee members be chosen? - Examine workload and expertise

11. The Structure of the Board of Directors • Should the Executive Director be a member of the Board of Directors? - Advantages and disadvantages

12. * DISCUSSION * • How is your association’s Board of Directors structured? How often are new members added to the Board, and how are they chosen? Are committees utilized effectively? • What changes could be made to the structure of your association’s Board of Directors and committee system in order to help the Board (and association) function more effectively and efficiently?

13. Board Member Job Descriptions Chair of the Board of Directors • Oversee Board and Executive Committee meetings • Serve as ex-officio member of committees • Work to ensure resolutions are implemented • Appoint committee chairs • Help prepare Board meeting agendas • Recruit new Board members and conduct new member orientation • Handle Executive Director personnel issues • Act as alternate organization spokesperson • Assist with Board self-assessment

14. Board Member Job Descriptions Secretary of the Board of Directors • Attend all Board meetings • Serve on the Executive Committee • Maintain all Board records • Review Board minutes • Assume responsibilities of Chair in their absence • Provide notice of Board or committee meetings

15. Board Member Job Descriptions Treasurer of the Board of Directors • Understand financial accounting for nonprofit organizations • Serve as financial officer and chairperson of the finance committee • Manage Board’s review of action related to financial responsibilities • Ensure financial reports are made available to the Board regularly and promptly • Review annual audit and address Board concerns

16. Board Member Job Descriptions Individual Board Members • Attend all Board and committee meetings and functions • Review agenda prior to meetings • Serve on committees and task forces • Inform others about the organization • Assist in Board recruitment • Keep up-to-date on field developments • Follow organization’s fiduciary, confidentiality, and conflict of interest policies

17. * DISCUSSION * • How are officers for your association’s Board of Directors selected? • Are clearly written job descriptions consistently maintained, with updated copies placed in Board manuals regularly? Should any of your Board’s job descriptions be revised in order to prevent the overlap of responsibilities or potential miscommunication?

18. Committees Committees are formed to… • Spread out the Board of Directors’ workload • Assist in developing Board expertise • Save time • Handle an ongoing organizational responsibility

19. Basic Needs of Effective Committees • All committees need clear direction. • All committees need written records. • All committees need to succeed. • All committees need healthy working relationships.

20. * DISCUSSION * • How are your Board’s committees managed? • Does this style of management and structure allow the committees to succeed by the standards listed in this presentation? If not, what changes should be made?

21. The Board Manual A Board manual serves two functions: • Orientation handbook for new Board members • Working tool for experienced Board members

22. Guidelines for Effective Board Manuals • Keep each item brief. • Utilize the manual as an orientation “textbook.” • Encourage open discussion about the material. • Regularly evaluate the manual’s usefulness. • Include limited examples.

23. Board Manual Contents Checklist • Information about the Board of Directors • Historical references • Strategic framework • Board meeting minutes • Board policies • Finances and fundraising • Staff and other organizational information

24. * DISCUSSION * • How helpful is the manual used by your association’s Board of Directors in helping the Board achieve association goals? Do Board members refer to this manual often? • What items should be included that are currently omitted?

25. Fiduciary Duty Fiduciary duty requires the exercise of reasonable care in performing association functions, characterized by honesty and good faith, always placing association interests ahead of individual interests.

26. Conflicts of Interest • A conflict of interest may exist when a member participates in the decision-making process on an issue for the association while concurrently having other interests that could tend that member toward bias. • General procedures for dealing with conflicts of interest: disclosure, recusal, resignation

27. Confidentiality Members must maintain in confidence, indefinitely, whatever information the association desires to keep confidential.

28. * DISCUSSION * • What are your association’s regulations regarding fiduciary duty, conflicts of interest, and confidentiality within the organization and among Board members? Are these regulations enforced? • Is your association doing all it can to protect itself legally in terms of these three areas?

29. Board Attendance Policy • This policy is intended to support full contribution of all Board members. • Every member should receive a copy. • The policy should be reviewed annually. • Policy details are based on specific Board needs. • Board members should precisely document and date all attendance communication.

30. What is a Quorum? A quorum defines how many Board members must be in the room before a meeting can begin and binding decisions may be made. The number constituting an organization’s quorum should appear in its association bylaws.

31. * DISCUSSION * • What is your association’s attendance policy for its Board of Directors? • Is this policy enforced, and do members value their commitment to the organization to attend all required meetings? • Does the Board regularly have the necessary quorum to ensure the organization progresses toward its goals?

32. Guidelines for Meeting Agendas • Employ a detailed agenda for each meeting • Specify what action needs to be taken by the Board on the issues at hand • Examples: Discuss meeting minutes (Approval required) Finance Committee Report (Approve budget changes) Board Development Committee (Approve retreat plans)

33. Guidelines for Writing the Minutes • Minutes are serious legal documents • No standard format, but detail is necessary • Include logistical aspects of the meeting (time, location, attendance, voting) • Board Secretary’s responsibility • Distribution and Board approval

34. * DISCUSSION * • Does your association always utilize specific and detailed agendas for Board meetings? • Do these agendas encourage action (rather than simply discussion)? • Are detailed minutes for every meeting taken and distributed regularly? • What could be done to improve the organization of your association’s Board meetings?

35. Board Information Systems • Effective systems should focus on decision-making, stimulate participation, and support a balance of responsibility between the Board and association staff. • Information systems require input from both the Board and association staff.

36. Basic Ingredients of a Board Information System Two weeks before quarterly Board meetings: agenda, information about issues for discussion, committee reports, finances Two weeks before annual Board meeting: annual budget, audit report, strategic plan After each Board meeting: minutes, notice of next meeting Monthly: financial report, significant PR pieces Quarterly: financial report Regularly: current activity memos, updated Board manual material, advance copies of promotional material and publications

37. Characteristics of Good Board Information • Concise • Meaningful • Timely • Relevant to responsibilities • Best available • Clear context • Graphic presentation

38. * DISCUSSION * • Does a Board Information System exist in your organization, and if so, how is it structured? • How effective is your association at distributing timely and important information to the Board of Directors? • What is the quality (and quantity) of the information that is distributed to Board members? • Are there areas in which improvements should be made?

39. Resources consulted for this presentation: • www.BoardSource.org 2006 • Outi Flynn. “Meeting Participation.” Meet Smarter: A Guide to Nonprofit Board Meetings. BoardSource, 2006. • Jerald Jacobs. Association Law Handbook. Washington, DC: American Society of Association Executives, 1996. • Carter McNamara. “Board Attendance Policy (Sample),”“Board and Staff Responsibilities,” “Sample Board of Directors Meeting Minutes,” Authenticity Consulting, LLC, 2006. http://www.managementhelp.org • The Nonprofit Board Book: Strategies for Organizational Success. Revised edition. West Memphis, AR: Independent Community Consultants, 1985. • “Sample Board of Directors Meeting Agenda,” in Field Guide to Developing and Operating Your Nonprofit Board of Directors, as reprinted on http://www.managementhelp.org 2006

40. Any final thoughts or questions?