Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Nonprofit boards are weird

cold-takes.com

Post reply on HN
Print view View original

11–20 of 67 posts

Re: Nonprofit boards are weird

#11

Post by AlbertCory »

I find this interesting because it was suggested (not urgently) that I could be on the board of a local food bank. This article did not even mention D&O insurance, but they said they would have it.

What scares the sh&t out of me is being financially responsible for anything any volunteer ever does (and possibly that not being covered by the insurance). None of the comments so far mention that either. Is that fear overblown?

>Board members who can't say much about where they expect to be highly engaged, vs. casually advisory ... don't seem like great bets to step up when they most need to (or stay out of the way when they should)

Indeed, I have no idea what I would do, so probably I should stay off.

Re: Nonprofit boards are weird

#12

Post by hmessing »

I think the weirdest thing about non-profit boards is that people in general pay (in the form of donations) to be on them, as opposed to for profit boards where the money flows the opposite way. Much of the interaction between the board and management is designed to keep the donations coming, which can create a real conflict between good governance and financial stability.

Re: Nonprofit boards are weird

#13

Post by mherdeg »

My town has an elected position called the "board of library trustees" which has just a few powers, including notably the ability to hire a new library director.

There are usually vacancies and poorly-contested elections for the position, even this year when the director resigned and the town had to search for then hire a new one. The job has a fair amount of influence on a critically important part of civic infrastructure, but people don't seem to be stepping up to do it.

Every time there's a vacancy I took at the state handbook that describes what your job should be if you're one of these trustees and I decide I am not confident I could do those tasks as well as the job deserves: https://mblc.state.ma.us/for/2012-Handbook.pdf . It's a LOT!

Re: Nonprofit boards are weird

#14

Post by clairity »

yardie wrote: post #6

I'm on a few non-profit boards and one of the things I don't see the author mention at all or specifically is the primary directive of the board is the financials. The CEO/Director is in charge of the day to day operations. The board has very little interest in that. A non-profit will have some or most of it's money from donors and those donors want to make sure that donation is being spent effectively. And that is w…

much like a startup, the key thing to understand about non-profit boards is that the board members' primary job is to fundraise (directly or indirectly) and secondarily to make productive introductions (donors, partners, 'customers', funding organizations, etc.).

a distant (but not insignificant) third is strategic direction, which is often what we imagine board members do, but that's a relatively minor part of the role. some board members might have some operational input, but that's usually not expected for any but the smallest non-profits.

Re: Nonprofit boards are weird

#15

Post by basseq »

Most of this article could apply to for-profit boards as well. Some of the key points here (e.g., lack of clear responsibilities) come from immature governance, rather than any particular difference in org. type. It's easier to join a nonprofit board than a for-profit board, so you get less-experienced people (and leadership!). And nonprofit boards often come with a) fundraising responsibility and b) networking opportunity, so it can be a different kind of gig.

Re: Nonprofit boards are weird

#16

Post by ghaff »

yardie wrote: post #6

I'm on a few non-profit boards and one of the things I don't see the author mention at all or specifically is the primary directive of the board is the financials. The CEO/Director is in charge of the day to day operations. The board has very little interest in that. A non-profit will have some or most of it's money from donors and those donors want to make sure that donation is being spent effectively. And that is w…

I'm on the board of a very small non-profit--actually a student organization (that all of the board belonged to at some point in time, often quite a few years ago).

We actually pay quite a bit of attention to financials and discussing them takes up a decent chunk of a board meeting including whether fundraising letters are going out (and reviewing them), overall financial situation, lease renewals, larger purchases, etc.

As for responsibilities, I'd say it's a bit of a mix. There's an executive board--which I'm on--where specific responsibilities are pretty clear. The rest of the board probably much less so other than showing up for meetings.

>A true non-profit has to spend almost every dollar it takes in.

We certainly try to have a reasonable reserve. And, fortunately in recent years, we've been able to fulfill the basic mission while staying in the black.

Re: Nonprofit boards are weird

#17

Post by Sniffnoy »

ilamont wrote: post #10

The author is making some broad generalizations ("Board members often know almost nothing about the organization they have complete power over") that don't match what I've seen as a nonprofit board member. There are certainly best practices out there, as nonprofit management is a very developed "industry" in the United States and I suspect other countries as well. I don't know why he had trouble locating this informa…

> I don't know why he had trouble locating this information.

If you're aware of good references to check out, it would be helpful to list them here.

Re: Nonprofit boards are weird

#18

Post by autarch »

I've served on two nonprofit boards with a combined time of about 22 years or so on them. Both were/are much more engaged than the boards described in this piece, but I think they are an exception.

The other thing I'd add as a nonprofit board responsibility is to be the final owner of the organization's mission and values, and to make sure the organization sticks with them. To a large degree, this is deeply entwined with evaluating the CEO, since one way a CEO can fail is to let the org drift off mission or fail to live up to its core values.

Another thing I'd add, at least for smaller orgs with few employees, is that the board can be part of regular long-term strategic planning (1+ year plans) and budgeting discussions. But of course this requires a more-than-normally engaged board to be useful.

Re: Nonprofit boards are weird

#19

Post by dougmwne »

Oh boy, can I relate to this! I have spent about a decade working for nonprofits and I think they are extremely weird organizations with no good accountability or feedback loops built in unless the CEO and Board choose to implement them. The quality of the organization almost completely flows from a few highly engaged board members, one or two donors that may give the majority of funding, and the CEO. If they are spectacular, you get a spectacular org, if they suck, you get a sucky org (and maybe some crimes as well).

Because the thing is, the customers of the nonprofit are the donors which purchase the marketing story of nonprofit and nothing else. It is sort of like bitcoin, there are no fundamentals, just the hype and hope and that is the only fuel needed. The actual programmatic activities of the nonprofit do not need to bear any resemblance to the marketing story the donors purchase. If you are very good at telling that story, you do not need to answer to the donors at all on the real performance metrics of your org. A very large donor may demand to see these fundamentals, but you don’t need them if you have smaller donors. Grant making foundations also often demand fundamentals and measures of effective philanthropy, but you can avoid taking any grants that expose you to too much governance.

And finally the board tends to be the society of friends of the CEO, so they very rarely do anything but use their connections to boost the money and influence of the org.

In the end; the CEO does not need to answer to the board, the donors, the beneficiaries, the shareholders, the IRS, the Gates foundation or the employees. They answer to their own conscience.

Re: Nonprofit boards are weird

#20

Post by kekeblom »

I would add that the probability of a task getting done, is inversely proportional to the distance between the people deciding about the task and the people who will actually do it.

Since the board members are almost never the people implementing the decisions, the plan is much less likely to get executed. The decision needs buy-in from the CEO and then the employees. Since the board members don't spend much time with the CEO and employees and they have a very different view of things, that buy-in is likely to be weak, so the plan gets watered down every step of the way.

Really makes you realize why things are so inefficient in public organizations and politics.

In a two person startup, if the founders decide to do something and they are the people executing on that decision, the task is very likely to get done fast and in full. If a non-profit board decides to do something, not so much.

Post reply on HN