Board Governance

Your board of directors plays an integral role in your business. (Credit: pixabay) Entrepreneurs that start a nonprofit corporation must appoint a board of directors for the organization. Appointing a board of directors for a nonprofit is a non-negotiable legal requirement for starting up, much like filing articles of incorporation or creating bylaws. While there is a bit of flexibility involved in structuring the board, sometimes it is unclear as to who should be on that board. How do you decide which individuals make up a nonprofit’s board of directors? Are there certain people who should be included on the board? The truth is that there isn’t a “right” answer for assembling a board of directors. No two nonprofit boards will be composed of the exact same individuals. That’s a good thing! Every director must be able to fulfill specific responsibilities, provide guidance, and possess skills that help the nonprofit reach its full potential. So who should you seek out to join your nonprofit corporation’s board of directors? As you vet potential candidates to appoint, look for individuals that possess the following mix of qualifications. 1. Experience It does sound like a no-brainer to seek out experienced individuals to join your nonprofit corporation’s board of directors. Those members with managerial experience and expertise within their given field may vary in background. You might bring on a legal attorney or a retired senior executive that specialized in areas like human resources and research operations. Or, you may choose to bring on an individual with a track record for working on previous boards. That’s also a key aspect to creating a robust board of directors for a nonprofit corporation. Those appointed should not be the same cooks in the kitchen. You’ll want to find individuals with diverse professional backgrounds different from your own and other members, too. Since they intimately understand the ins and outs of the industry, they can help out with areas where there may be knowledge gaps and take on these responsibilities. 2. Fresh Perspective I am a member of the Board of Regents at California Lutheran University. True, this is not a nonprofit corporation but being part of this board allows me to play a pivotal role in helping govern the university. When I joined nearly nine years ago, I was one of the youngest members on the board. My age differentiated me from the rest of the members, but in a positive way. I was able to bring fresh ideas and thoughts to the table, and contribute to the greater good of the school. As you look for experienced members to join a nonprofit’s board of directors, do not dismiss potential members based on ageism. Younger individuals often get their start at an early age, thanks to the rise of social-media platforms. Other opportunities, like starting an internship as soon as in high school, may allow them to get their foot in the door and quickly build experience that allows them to be taken seriously. These individuals, if elected to the board of directors, may bring fresh perspectives based on their portfolios and observations within their generation. Keep an eye out for fresh, buzzworthy faces, and be willing to gradually “cycle” through boards of directors over time. 3. Independence You’ve added experienced individuals to your board of directors, as well as rising newcomers. If your nonprofit corporation has investors, these individuals may also be on the board. This is typically by default, due to the nature of how they financially backed the organization. It is critical that you add an independent individual to the board of directors. This board member should not be employed by the company, or someone who financially contributed to it. Generally, theirs is an outside voice. However, it is still a voice that understands the mission of the business. This same independent individual may also possess valuable soft skills and emotional intelligence (EQ). That combination of personal and social competence ultimately works in one’s favor to inspire other board members, assist in decision making, and adapt to changes. A final thought... Lastly, it’s not uncommon for a nonprofit corporation to bring on too many individuals for their board of directors. The trouble with this, of course, is bloating the board. If there are not nearly enough responsibilities for board member, then certain ones may want to quickly exit before they have the chance to make their mark. Keep your board of directors as lean as possible. Remember that when searching for the “right” members to join the board, they should be passionate about the nonprofit, diverse in opinion, and ready to follow the corporate bylaws created for their roles. Deborah Sweeney is the CEO of MyCorporation.com which provides online legal filing services for entrepreneurs and businesses, startup bundles that include corporation and LLC formation, registered agent services, DBAs, and trademark and copyright filing services. You can find MyCorporation on Twitter at @MyCorporation.

Board Governance

How to Put Together a Nonprofit Board of Directors

The Story Exchange

Board Governance

How to Put Together a Nonprofit Board of Directors

The Story Exchange

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