Maintaining a healthy governance board is an imperative for a charity to deliver on its mission, attract and retain donors and ensure the organization remains sustainable and beyond reproach. Unfortunately, when a board’s health or effective functioning diminishes so does the trust stakeholders and the public has in the organization.
During the past year numerous examples of ill managed governance boards have emerged across our sector. For me, this is alarming and echos the need for charities to do a much better job holding their boards accountable and restore public trust.
The Muttart Foundation’s 2013 report, Talking About Charities speaks to the trust level Canadians have in their charities. While 79% of Canadians report having a lot or some trust in charities, there is a need to understand why 20% say they have little or no trust in charities. In my opinion, it’s the erosion of trust, accountability and health of the board team inside the organization that has rippled to the public arena.
Below I have shared common signs of poor board health. While a board may be suffering from one or a few of these indicators, the board should measure their performance against all indicators to gain a full situational awareness of their health and develop a measured improvement plan.
10 Indicators your board is suffering from poor health:
- An obvious troubling sign is declining attendance at board and committee meetings. Challenges in achieving quorum or holding attendance for the entire meeting(s) are clear signs the team is in trouble.
- Yes, members are showing up to the table, however their engagement in the discussions and decision-making process is eroding. Poor engagement may be related to the dynamic of the group, particularly if one or a few members dominate the discussion and shut out the view of others.
- It is expected boards will take reasonable time to make thoughtful, informed decisions, however when gridlock or failure to reach decisions becomes common your board may be in real trouble. Symptoms of indecisive boards tend to relate to Chair leadership, understanding of the board’s role or the lack of confidence and preparedness of its members.
- Dysfunctional boards develop poor reputations making it difficult to attract and retain membership. Boards should have effective succession plans in place to revitalize the membership with the competencies to address changing societal needs.
- Effective boards and management teams should engage in healthy discourse. When civil discourse manifests itself into a lack of mutual confidence or respect appropriate board functioning will drop off.
- It’s the fiduciary responsibility of a board to set bylaws and policy to guide the current and future board in their governance. Healthy boards are well-informed and mindful of these structures and their responsibility to adhere to them, whereas unhealthy boards chose to disregard policy, procedures and related legal governance practices opting to ‘go it on their own’.
- The Chair’s ability to lead the group, maintain cohesion and adhere to good governance practice is critical to the board’s success. Boards not respecting the roles of the individual members, ignoring negative or passive/aggressive behaviors of members compromises the effectiveness of the group and the organization.
- Effective boards are clear about their strategic mandate and provide the appropriate level of support to the executive director on operational issues without creating unnecessary friction or conflict. When a board is disengaged in policy development, fundraising or connecting strategy to operations it’s a sign of an unhealthy board-employee cohesion.
- All Board’s have legal responsibilities to fulfill. Whether membership agreements, donor gift agreements, Canada Revenue Agency submissions or employee contracts, to name a few, each board member needs to be mindful of all of these requirements. Boards slipping into situations of not legally upholding their agreements place the organization’s health and sustainability at risk.
- Charities are dependent upon the maintaining vibrant relationships with all stakeholders and effective boards maintain healthy, transparent relationships with all partners. Conducting regular checks to monitor the health of the relationship can help to retain stakeholders and provide a Board with important feedback for their own development.
In an upcoming post I will share my strategies on developing and maintaining a healthy functioning board. Below I have provided a few helpful links.
Reference Table: Muttart Foundation Canada Trust In Charities 2013
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