Nonprofit Board Stages of Development #NonprofitBoards

I found the following prescriptive instructional on building a nonprofit organization interesting with some helpful tidbits.  And, I particularly like the video.  

 

At the same time, I was disappointed with what I believe to be the absence of one particularly critical reference: board stages of development.  Board stages of development are not what is outlined in the steps toward building a nonprofit - these are correctly identified as "steps" that are primarily transactional and do not singularly recognize the important relational activities that are involved in board member recruitment and the additional activity of developing a theory of change (identifying the "problem to be solved"; the preferred solution; and, the intended result) that leads to defining the mission.  

But as critical as the steps are, the author, under the heading  "types" of boards offers that there are volunteer boards and governance boards.  I would strenuously argue that all boards (for the most part are volunteer) and all boards have governing (fiduciary and strategic) responsibilities BUT their execution of these responsibilities, for better and for worse, vary depending on their stage of development.  

In my article "Act Your Age", I pose that there are four stages: infancy, juvenile, adolescent, and mature.  I further pose that a nonprofit board can be in any one of these stages while the organization and its programs can be in a different stage of development.  And, I pose that the distinction between these stages is about what role the members play, often determined by the resources that pose specific demands on members.  To be more precise, my study indicates that boards in their infancy stage, most often without paid resources, tends to pay attention first to delivering services and getting the doors open.  To some degree, this is about fulfilling the fiduciary duty of care by ensuring theirs is an organization and program (s) by board members doing the work themselves.  And yes, the consequence may include the lack of attention to fiduciary compliance and records and the like.  The juvenile stage may move the board to begin the process of paying more attention to typical governing tasks including getting a full-time staff person to offset the work the members have been conducting.  Adolescence often includes the board having successfully transferred a lot of its infancy duties but not always wanting to pay attention to longer term, future organizational needs and maturity is likely more what the author of the following article refers to as governing with no attention to management or implementation and all attention to policy/compliance, strategy, evaluation and big-picture problem solving.  

Stages matter because I believe nonprofit boards can't just easily jump into the non-managing and big picture seat without ensuring the other parts of the organization are fully in place.

This said, do enjoy the clip and the article and consider both in light of stages of development.  The process for getting through the stages (and sometimes going through the stages multiple times) is not simple but matters when it comes to thinking about how, as a nonprofit board, to have the best results.

PS - I concur with the two important committees, Governance and Finance (and includes Fundraising) and believe all other board off-site gatherings with specified tasks can be conducted in Task Forces with specific sunrises and sunsets and reports back to the full board.

 

 

August 15, 2016

How to Build a Nonprofit Organization by Travis Barker

 

The steps towards Building a Nonprofit Organization will vary depending on your organization’s location. Despite the different steps identified per country there remain many shared steps which we’ll discuss below:

image: http://cdn.business2community.com/wp-content/uploads/2016/08/Innovate-Vancouver-Incorporating-as-a-Nonprofit-in-BC.jpg.jpg

1. Step One – Incorporating as a Nonprofit: Identify what type of corporation you want to create and submit the appropriate forms, documents, and information to the relevant government office (and pay relevant fees). Note, the following steps emphasize organizations incorporating as a nonprofit.
2. Step Two – On-boarding & Developing New Board Members: Recruit, engage, develop, and on-board the organizations Board Members.

The next step is to prepare the organization’s constitution & bylaws (and Mission, Vision, & Values Statements). This would typically be put together with the help (or sometimes exclusively, on their own) of your board. For nonprofits, the board members are volunteers that are invested in your mission. The following ‘roles’ should be included in your organization’s Board:

1. President
2. Vice President
3. Secretary
4. Treasurer
5. Ideally, it’s great to also have someone that fills the role for Fundraising/Public Relations (and they could help you with your fundraising projects!)

Committees are formed from these roles (and include other members of the board) and typically include:

1. Governance Committee
2. Finance Committee
3. And ideally, a Fundraising Committee

Other committees are also formed depending on the organization’s industry and needs. Such as:

1. Human Resources Committee
2. Quality Assurance/Audit Committee

‘Types’ of Boards

Keep in mind that there are ‘volunteer boards’ – that help out quite a bit, but Canada has been moving more towards ‘Governance Boards’ – which focus on strategy and oversight. I currently sit on a governance board, but recognize the pros/cons of each. Board governance follows a set of standardized rules for decision making.

3. Step Three – Drafting Agency Constitution, Mission, & Bylaws: With the help & leadership of the Board, draft the organization’s governing documents and submit to the relevant government office along with your application for the Charity Tax Status.

Ideally, you have board members who are experts in the above roles. In addition, a lawyer is also great to have on the committee as well.

Other areas of specialization include child welfare, education, nonprofits, leadership, human resources, etc. Once the board is formed, the board members typically take on the lead for recruiting future members. The term for board positions is 2 years, although many may choose to stay on longer. The on-boarding process includes interviews, and the BOARD vote (requires a quorum to elect a new member). The Board technically supervises the CEO/Founder, and emphasizes strategic initiatives. Typically, the CEO otherwise has the discretion to handle Operational issues on their own (with some consultation with the Board, if needed).

With a new organization it is often recommended to begin recruiting those board members who specialize in policy and understanding the legislation of the New Societies Act of BC (as well as the organization’s area of focus). In addition to identifying requirements around the organization’s Constitution & Bylaws, The New Societies Act of BC also informs the steps to incorporate as a nonprofit.

There are some new updates to the Act this year, so you will see some language mentioning the ‘transition.’ The transition can largely be explained and transitioning from paper filing/copies to digital filing/online. There are a few other details as well, but the Board’s first step might be simply to take a look at this page to determine how to put the Constitution & Bylaws together (and where/how to file them).

Recommended for YouWebcast, August 17th: The Secrets of Deep Networking

Having a nonprofit board has a lot of advantages, but can become a little political. That’s the life of all nonprofit execs, I’ll admit. But if carefully engaged during the initial forming stages of your organization – they can also be very helpful to get the documentation and policies in order.

4. Step Four – Applying for Charity Tax Status: Apply for the organization’s Charity Tax Status. Once approved this tax status allows pursuing funding opportunities not available to For Profit businesses.

Nonprofit grants will require a letter and charity number verifying your organization’s tax status. The links above should also provide suggestions regarding how to complete grants, etc.

The key challenge will be to identify grants that provide funding for the exact purpose you are looking for (a challenge all organizations face). Since there is often quite a bit of tracking and reporting requirements for each grant most organizations prefer to target larger grants to justify the time and effort. Please refer to your local government’s websites for links and additional information for organizations in other locations.

Nonprofit grants will require a letter and charity number verifying your organization’s tax status. The links above should also provide suggestions regarding how to complete grants, etc.

The key challenge will be to identify grants that provide funding for the exact purpose you are looking for (a challenge all organizations face). Since there is often quite a bit of tracking and reporting requirements for each grant most organizations prefer to target larger grants to justify the time and effort.

Organizations may also want to consider pursuing other traditional funding vehicles prior to a nonprofit securing their Charity Tax Number. The funding available to an organization will depend on the business’ tax status.

image: http://cdn.business2community.com/wp-content/uploads/2016/08/Innovate-Vancouver-Funding-Available-to-New-Existing-Businesses-NP-For-Profit.jpg.jpg

Beginning with an aligned culture of shared meaning and values is crucial for nonprofit organizations. The process of Incorporating as a Nonprofit and securing your organization’s Charity Tax Status is a lot of work. But the steps are worthwhile as they will set the foundation for the organization’s direction, vision, and future. With the organization’s Constitution, Bylaws, & Mission the agency staff has the guiding documents, values, and statements to build momentum.

Read more at http://www.business2community.com/non-profit-marketing/build-nonprofit-organization-01623611#XHIUKWOIzeATVCps.99