November 18, 2017
 
What Your Nonprofit Needs to Accomplish Determines Board Size

By Thomas A. McLaughlin

Thomas McLaughlin
One of the first crucial decisions a new nonprofit must make is to determine how many people should be on its board of directors. This might seem like a simple decision, but the answer can have significant consequences.

The key question to ask when determining the size of a nonprofit board is ‘what you want the board to do?’

If you said “govern the organization,” you’re in tune with what the Internal Revenue Service and various state attorneys general require. Two additional answers could be tacked on to the governance responsibility -- raise money and network. These are the three classic tasks of a board of directors, and each one greatly determines the board’s desirable size.

The following looks at boards of organizations according to the principal tasks that need to be done.

The Board as Governing Body

The heart of the board’s legal role is to make decisions and choices as representatives of the public good, but making group decisions is not easy. Therefore, the optimal board size is when the group is big enough to have diverse views, yet small enough to allow adequate participation. This is why many nonprofit boards, especially in smaller organizations, tend to have a membership somewhere between the low teens to the low 20s.

Board size is particularly important in this context because there is a fair degree of misunderstanding about how boards should conduct themselves. Often there is a tendency to look toward the rules and practices of legislative bodies for guidance, but that is a big mistake.

While the majority of nonprofit boards at least informally follow Robert’s Rules of Order, it was based on the 19th century U.S. House of Representatives and other assemblies and its underlying model does not relate fully to the legal requirements of today’s regulated, government-supervised, board-oriented nonprofits.

Boards that focus solely on governance, such as those for human services providers, tend to be smaller. Without good fundraising prospects, this type of board can be as small and functional as desired. Their heavily regulated and administratively supervised environment also encourages them to use convergent policy making, and that’s always easier with a small group.

The Board as a Fundraising Entity

For organizations heavily dependent on fundraising, a small board is a handicap. Fundraising and development differs from fundraising, and the people who want to engage in these responsibilities may be less interested in governance issues, which is why nonprofits that are dependent on fundraising should have larger boards. These nonprofits also typically have a give-or-get policy – being on the board means you have to give, or get others to give, a certain amount of money each year.

Symphony orchestras are classic fundraisers in this mold. Many such groups have board memberships in the high two digits, or even in the low hundreds. Universities also follow this model.

The Board as a Networking Organization

Some organizations need a large board of directors because of the way the mission is carried out. An environmental advocacy group might need a board of this size because politically it needs to cover the entire state. It might even have a representative form of government, with counties or geographic areas each being allowed to nominate a representative to the board. This could help in advocacy matters as well.

Nonprofits with large boards will quickly have members in a dilemma. If bigger is better for fundraising and smaller is better for governance, how can an organization with a large board reconcile the obvious conflict? The answer is by creating an executive committee, which becomes the true governance group. The larger board serves a ceremonial and networking function, meeting perhaps once or twice a year, while the executive committee carries out the traditional governance role.

Boards Caught in the Middle

The most cumbersome boards are those that are caught in the middle -- too large to be small and too small to be large. These “tweeners” are boards of, say, 30 or more members that don’t have an underlying rationale for the size. These boards are often ill suited for governance purposes. Also, because it is hard to recruit large numbers of true leaders committed to the cause, boards of 40 or 50 members easily fragment into different camps.

Over time, a nonprofit board’s size tends to reflect what it needs to do. Governance is the minimum task, but assisting with fundraising and networking is equally valid. Each responsibility tends to dictate a different size board of directors.

Thomas A. McLaughlin is the founder of the consulting firm McLaughlin & Associates and a faculty member at the Heller School for Social Policy at Brandeis University. Email him at tamclaughlin@comcast.net. An earlier version of this article was published in The NonProfit Times.

January 2014

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