Board Chairs and Board Leaders Mary Hiland, nonprofit leadership expert, interviews Mike Burns to discuss national research on board chairs and board leadership.
Inspired Nonprofit Leadership Mary Hiland, nonprofit leadership expert, interviews Mike Burns to explore nonprofit board stages of development. Mike offers that recognition of board stages helps establish achievable expectations.
"Effectively Raising Capital: The Board Chair & Executive Director Relationship" Mike Burns and Kevin McQueen, partners at BWB Solutions, and special guest Carla Weil, the Chief Strategy Officer from Capital for Change, the largest full-service CDFI in Connecticut, share their experiences effectively identifying funding sources and raising capital to strengthen an organization and provide more impact in low-income communities. Carla Mannings of Partners for the Common Good and CapNexus moderated the panel.
Share power to strengthen your board. Are your board leaders struggling to balance power among themselves? Are they not understanding their roles outside of the boardroom? If you answered yes to any of these, listen to Ep. 58 of our podcast as we host Mike Burns and Judy Freiwirth. Mike and Judy share their expertise, which is based on their Nonprofit Alliance study Voices of Board Chairs.
Making a Lasting Difference I've been struggling to finish "Making a Lasting Difference" by Graeme Reekie since first I received this book about 6 months ago from Wren and Greyhound. The press is British but I thought the subject would be universal for nonprofits.
Alas and sadly, this is a slow, tedious read filled with platitudes and almost helpful considerations nonprofit managers might want to consider when thinking about how to financially sustain their organizations.
I have generally posited that a nonprofit has 4 "pillars" that comprise its DNA: program, management and operations, governance and sustainability. M. Graeme offers five: involvement ((having community support); Income generation; Innovation ("how to nourish and encourage incremental innovation); Improvement (systems and structures); and impact measurement. So he and I don't operate from the same lens but his is certainly one perspective.
Making a Lasting Difference is constructed in four parts, 20 chapters and 211 pages. The possibly most innovative content is in Part 2, Chapter 2 where paradoxes, principles and practices of sustainability are presented. The paradoxes:
a. Change - only by changing can organizations be sustainability, sustainability does not mean sustained, and, the lesson is that an org. must learn, adapt and evolve purposefully. Here the author poses that an org has to have its act together to achieve sustainability
b. Octopus - organizations need to reach out in new directions to grow but growing in too many directions pulls them out of shape; diversified income does not mean reduced risk; and, an org must focus on core organisational purpose and structure. Here the author says that mission drift will not make you sustainable.
c. Yes/No the things that an organisation needs to survive can also kill it. Saying yes to everything is fatal; sustainability is about more than just money. Capacity and quality matter. Understand when, how and what to say no to. I would offer this is the "stay in your lane" paradox.
d. Efficiency - Efficiency preserves resources but can impair development. Organisations cannot evolve, adapt or respond without spare capacity. And orgs should balance strategy and scrutiny. They should invest in capacity building.
To all of this I just want to say: uh, ok and thanks for the amazing insight. No, not really! I would not invest in this book. You can better spend your time reading the Federal Register looking for grant opportunities (good luck given the current environment) or going through the Foundation Center directory or building an endowment from rich people who loved you (yes, this really is the key to sustainability). Making a lasting difference may be a good idea when thinking about long-term impact from what your nonprofit does - reading this book will not.
I've been struggling to finish "Making a Lasting Difference" by Graeme Reekie since first I received this book about 6 months ago from Wren and Greyhound. The press is British but I thought the subject would be universal for nonprofits.
Alas and sadly, this is a slow, tedious read filled with platitudes and almost helpful considerations nonprofit managers might want to consider when thinking about how to financially sustain their organizations.
I have generally posited that a nonprofit has 4 "pillars" that comprise its DNA: program, management and operations, governance and sustainability. M. Graeme offers five: involvement ((having community support); Income generation; Innovation ("how to nourish and encourage incremental innovation); Improvement (systems and structures); and impact measurement. So he and I don't operate from the same lens but his is certainly one perspective.
Making a Lasting Difference is constructed in four parts, 20 chapters and 211 pages. The possibly most innovative content is in Part 2, Chapter 2 where paradoxes, principles and practices of sustainability are presented. The paradoxes:
a. Change - only by changing can organizations be sustainability, sustainability does not mean sustained, and, the lesson is that an org. must learn, adapt and evolve purposefully. Here the author poses that an org has to have its act together to achieve sustainability
b. Octopus - organizations need to reach out in new directions to grow but growing in too many directions pulls them out of shape; diversified income does not mean reduced risk; and, an org must focus on core organisational purpose and structure. Here the author says that mission drift will not make you sustainable.
c. Yes/No the things that an organisation needs to survive can also kill it. Saying yes to everything is fatal; sustainability is about more than just money. Capacity and quality matter. Understand when, how and what to say no to. I would offer this is the "stay in your lane" paradox.
d. Efficiency - Efficiency preserves resources but can impair development. Organisations cannot evolve, adapt or respond without spare capacity. And orgs should balance strategy and scrutiny. They should invest in capacity building.
To all of this I just want to say: uh, ok and thanks for the amazing insight. No, not really! I would not invest in this book. You can better spend your time reading the Federal Register looking for grant opportunities (good luck given the current environment) or going through the Foundation Center directory or building an endowment from rich people who loved you (yes, this really is the key to sustainability). Making a lasting difference may be a good idea when thinking about long-term impact from what your nonprofit does - reading this book will not.
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:
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.
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:
President
Vice President
Secretary
Treasurer
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:
Governance Committee
Finance Committee
And ideally, a Fundraising Committee
Other committees are also formed depending on the organization’s industry and needs. Such as:
Human Resources Committee
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.
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).
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.
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.
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
The many New York nonprofit boards that have chosen to pursue mission and rely in part on contracts with the City may have an easier time in the future managing the consequences of these contracts.
As it stands now, these nonprofits have faced significant delays in getting their payments for service rendered and have also been knee-deep in paperwork in addition to bearing additional costs for borrowing bridge funds. Now the city is proposing to centralize contracts as an approach to at minimum, reduce the demands of the paperwork.
But are the nonprofit boards and staff prepared for new rules that may include a higher and more outcome-focused or results-based level of accountability? Many other institutional donors already set these standards for accountability. I believe it's certainly about time that municipalities set similar standards as funders. But more importantly, maybe this will be an opportunity for these nonprofit boards to become results focused as well. Being results focused is good for all: nonprofits, donors, and most important, those who are the nonprofit's beneficiaries.
Pedro Espada Jr. who is expected to become the majority leader of the NY State Senate has, according to the NY Times, a very colorful past in the way he spends money that isn't necessarily his to spend. Most of these incidents relate to his campaign, and the State, in all its glory, is trying to rectify the situation.
In a 2005 incident, again according to the Times, "three employees of a Bronx nonprofit health care company run by Mr. Espada, the Soundview HealthCare Network (aka Comprehensive Community Development Corporation), pleaded guilty to diverting $30,000 from Family Care and AIDS treatment programs to one of his campaigns. Mr. Espada was never charged."
Of course, given my passion about nonprofit governance and management, this offence of all those Mr. Espada is accused of, bothers me most. The diverting of any donated funds, especially from those with serious illness, is unacceptable and, at the very minimum, restitution should be made with interest and penalties if this has not been done. The public gives this money with the expectation it will be used for the intended purpose and used well. $30,000 was not. And, from what I can tell from the internet, Mr. Espad is still in charge. One has to wonder, where is this nonprofit's board? Are they not liable for this fraud (otherwise known as embezzlement?) This is most unsavory and disturbing news.
My message, let's get this case back to the courts, find out the truth about what happened, and get the money back to where it was intended.
Thanks to the Philanthropy Journal for picking up on the news that the Charlotte, United Way Exec, known for making humongous amounts of money ($1.2 million compensation package a yr) must resign or be fired by the end of September 2008. She still will have some bucks so 'tis not a hardship but she's out. Her temporary replacement will get $20,000 a month for the next month.
I am sorry for the exec. She didn't set her salary or benefits - her board did! I haven't heard she failed her duties or didn't meet her goals. I haven't heard she created bad will in the community except of course for her salary and benefits. The reason for firing should be about performance and I am not hearing that she has failed in this regards.
This is a board that needs some help - they don't understand nonprofit governance and responsibility and they need fixing. The $20,000 a month they will pay to the interim is one more indicator about how "off" these folks are. United Way National - don't you have a role to play here?
According to today's Chicago Tribune, the Gates Foundation has completed its hiring process to replace Bill Gates and has selected another Microsoft Exec.
Well, I'm not particularly surprised but a bit disappointed.
Given its assets and world impact, I thought the Foundation Trustees might seek a foundation professional, someone who knows the business as a good follow-up to its founder-exec.
We know from best practice that Founder Execs do one thing really great - they found. But the next person to follow a founder exec really must focus on building a strong institution and maybe the Microsoft guy can do this but I believe a foundation professional could have done this work better.
Remember, what the Gates Foundation does, given its size, is make an impact and we all benefit from an impact that is well planned and well managed. Lets hope that the new Gates Foundation exec is smart enough to hire smart professionals.
The Smithsonian Board has decided to change the salary structure for its executive staff. Salaries currently range to a high of $500,000 for its CEO and go as low as $158,000 (check the article to make sure these numbers are correct).
The new salary structure is going to lower the particularly higher paid execs to within legislative mandates but not the CEO.
How the salaries have been allowed to exceed federal rules in the first place I can't explain except to say that the board has been irresponsible and the feds haven't used their muscle.
But lets put this set of facts (ok, opinion) aside, I still want to better understand the criteria that goes into keeping the $500,000 CEO salary and re-arranging the remaining salaries. There certainly is the reality that other US mega-museums pay even more than this for the caretaking of invaluable objects. Excepting hospitals and universities and of course, some mega-churches, executive salaries rarely come close to the new Smithsonian amounts in the remaining nonprofit sector.
So what gives? Does the unique role of these nonprofit warrant high salaries? Should there be another nonprofit tax code to accommodate these institutions' perceived need to match the corporate for-profit world's pay schedules?
