September 25, 2017
 
Four Ways to Enhance Nonprofit Board Stewardship

By Kevin Monroe

Kevin Monroe
The role of the board in nonprofit organizations is similar to that of the legal guardian for a child: it oversees the organization on behalf of others, but is not the “owner” of the organization.

Following are four areas of board stewardship along with ways to enhance effectiveness.

Stewardship of Assets and Resources
This seems to be the most obvious area for boards and indeed, it is an important area. The board is responsible for protecting the organizations assets and resources as well as ensuring they are used to advance the organization’s mission. Yet not every member is an expert at reading financial statements and many lack confidence in asking appropriate questions related to the organization’s finances.

Here are a few ways you can enhance your board’s stewardship capacities:
  • Increase the financial literacy of your board especially as it relates to your organization.

  • Find a person who is both knowledgeable of finances and able to impart their knowledge to others who aren’t financial gurus. Ask them to train your board to read your financial statements and reports (using your documents as examples so board members increase their competence and confidence reading the reports they see regularly).

  • Create a dashboard report of the key financial indicators for your organization. A dashboard is a summary document that may include charts or colors to simplify data.
Stewardship of Mission
Being the steward of the organization’s mission, it is the board’s responsibility to keep the organization focused on it’s mission and ensuring all organizational activities and resources advance the mission. To help your organization better steward its mission:
  • Keep the mission central in all board meetings. Post the mission on the wall, include it on the agenda.

  • Include mission moments in board meetings – continually expose board members to the impact your organization has on others as you deliver on mission. Share success stories or testimonials from clients. Take a field trip to see the mission in action. Keep the mission top of mind and ever present as the board does its work.

  • Use the mission as core criteria for recruiting and evaluating prospective board members.

  • If your organization has a set of core values make sure current and prospective board members know and embrace them.
Stewardship of Community Trust
Your board has a responsibility to maintain the trust of those you serve (clients), those who partner with your organization to serve (funders, stakeholders, partners), and those that benefit from your service (directly or indirectly). Some ways you can enhance your stewardship of community trust include:
  • Invest time to understand your direct and indirect clients and identify your funders, partners, and stakeholders. Create opportunities to engage them in formal and informal discussions.

  • Be intentional about diversifying the composition of your board and expand recruitment activities to cast a larger net or prospective members.

  • Develop, implement, and monitor a conflict of interest policy to ensure board members are pursuing and protecting community interest rather than their own.

  • Remember as John Carver noted, “There is no way that the board can be big enough to have a spokesperson for every legitimate interest, so in a moral sense you must stand for them all. Think of yourself as being from a constituency, but not representing it.”
Stewards of Reputation
Your organization’s reputation is undoubtedly one of its most vital and valuable resources. The board’s stewardship also includes the organization’s reputation and image in the community. Consider the following as ways to create and/or maintain the organization’s reputation and integrity:
  • Build a board that shares the organization’s values and enhances its image and reputation by recruiting people of integrity. Additionally, ensure they have the tools, training, and resources to be effective in their board service.

  • Consider adopting a code of conduct (ethics) that protects and preserves the organization’s reputation. Take immediate action to preserve the organization’s reputation should a board or staff member be engaged in criminal activity or gross misconduct that threatens to tarnish the organization’s reputation.

  • Ensure a clear chain of command of who can commit the organization to legal contracts and then make sure the organization fulfills its commitments.

  • Establish a whistle-blower policy so concerned parties can report incidents of suspicious behavior with the confidence the event will be explored and without fear of reprisal to the reporting party.
Boards that are serious about their sustainability are also serious about their stewardship responsibilities. To paraphrase Josiah Stamp, there are some boards that dodge their stewardship responsibilities, however they cannot dodge the consequences of dodging their responsibilities.

Kevin Monroe is founder and managing partner of X Factor Consulting LLC, specializing in leadership development. He can be reached at kmonroe@xfactorllc.com or 404-713-0713.

June 2011

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