Board membership can be a great way to increase you and your company’s visibility. However being a non-profit board member is an involved and committed function. To increase chances of a favorable outcome we highly recommend women in business gain a good understanding of what might be expected from such an engagement, prior to pursuing or accepting a board member position.
With that in mind we asked Entrepreneur subscriber Crista LeGrand, CAE, CMP who is CEO and President of one of the Mid-Atlantic region’s premier association management firms (Clemons & Associates) to share her thoughts about board membership and some tips for a successful non-profit board member experience. This is what she had to say…
What does it mean to be a board member in the typical non-profit organization today?
First, I prefer to use the term “tax-exempt” organization rather than the misunderstood “non-profit” label. Actually, the Internal Revenue Service has changed and is using tax-exempt in most of its publications and forms. It is a more descriptive term that actually defines the organization. Non-profit implies “no profit” to many people and results in faulty decisions because of the misunderstanding.
Next, people are all busy these days. Technology has made many of our tasks easier but also more complicated at the same time. For today’s director, it means that you must make the commitment to serve, and then actually live up to that commitment. It also means to become involved with the organization and learn what makes it tick. It means accepting responsibility and making hard, tough decisions.
What is the difference between a governing board and a working board?
A governing board does just what its name implies: it governs. It sets policies. It determines the budget. It complies with the bylaws to get the organization’s work done. This means the staff actually does the work of the organization without interference by the board. It’s a partnership: the board directs; the staff performs.
On the other hand, the working board is about the directors performing the work. Some organizations just don’t have the resources to pay for staff or services, so the directors have to volunteer and accept responsibility for getting the tasks done. Sometimes a working board is excellent at what they do, and they are able to accomplish many of the goals set by the board. Other times, the volunteers are too busy with their own lives, or accept more than they can handle, or perhaps do not have the experience or expertise to carry out the functions they were assigned.
Most boards are a hybrid of the two, and that’s okay. There will almost always be people who have knowledge of a particular area and can really bring something to the table.
What kind of liability should someone be aware of prior to accepting a board member position in a tax-exempt organization?
There is liability to serve on a board for sure, mainly because of state and federal laws. However, it is not foreboding at all, because when a director commits to being on a board and understands that they are responsible for their actions and decisions, then they become aware of acting in a respectable and ethical manner.
People usually know the right thing to do. As long as they realize this fact, there are generally no consequences.
Also, the organization should have some indemnification protection for its directors to reduce exposure as well as liability insurance. These measures usually ease any uncomfortable feelings of the directors.
What are some of the biggest misconceptions you’ve come across when it comes to being a tax-exempt board member?
Probably the top misconception about being a director is when a prospective director is told, “Don’t worry, you don’t have to do anything.” This is just untrue, but oftentimes used to get someone to be involved or to agree to serving as a director. Serving on a board requires thought and action because the director is entrusted with advancing the organization and protecting its assets. It truly is a job and should be one that is evaluated at the end of each term to determine if the director should continue on and potentially serve in an officer position.
Another misconception is that “we don’t need an orientation.” By putting aside time for training and education using the orientation framework, directors can be acquainted with the organizations bylaws, policies and practices. An orientation strengthens the individual while also building the team. Organizations should insist on orientation for all of the newly elected or appointed directors. It’s a win-win for both parties.
“We don’t need to make money since we’re a non-profit organization.” This is a major misconception because people have a hard time grasping the concept that an organization can make money even though it is non-profit. In fact, an organization should be making money if it is to survive today. It needs money to carry out the mission of the organization. We have to change this thinking and that’s why I really believe we should be saying tax-exempt instead of non-profit. In essence, “non-profit” is a tax status and not a business model.
What are the top four tips you can give to someone striving to be an effective board member?
1. First, do not consider being on a board unless you can make the commitment of the time and expense of fully participating in the board’s activities. For example, if the board meets monthly, make sure you have the time to meet this requirement. Don’t get involved unless you can be fully engaged. The board expects this commitment.
2. Second, learn about what it means to be on a board and what your responsibilities are. There are many books on the market that can help explain what it means to serve on a board. The Perfect Board is one example.
3. Third, learn more about the organization. Really read the bylaws and past meeting minutes. Review the policies of the organization and understand how they promulgated.
4. Fourth, do the right thing. Most people know right from wrong. Sometimes it’s convenient or easier to “go along” with the crowd rather than standing up or speaking out. If you know that something is just not good for the organization, you owe to yourself and the people you represent to voice your view and convince the others that the direction they are headed may not be the right one.
About Crista: Crista LeGrand is the President & CEO of Clemons & Associates, Inc. (C&A). She has over 15 years of experience working in the association industry. Crista understands the association world and has been instrumental in the continued success of the organizations she and her teams lead. She has vast knowledge in working with hotels and planning meetings, conventions and tradeshows. Crista has earned the designation of Certified Association Executive (CAE) from the American Society of Association Executives (ASAE) as well as the Certified Meeting Professional (CMP) designation as recognized by the Convention Industry Council.