Keeping it Ethical is our weekly blog series highlighting the 33 Principles for Good Governance and Ethical Practice. Throughout the series, we hope to highlight the importance of each Principle, the helpful resources associated with it, and learn more from you about how you’ve incorporated these Principles into your charitable organization.
Charitable professionals everywhere love to feel special and nothing makes you feel more special than a day full of meetings. You can say important sounding things like – I am booked all day, I have a call at that time, or the crowd favorite I have a hard stop.
Ahhhh, the misery of a phrase to let others know you have meetings and calls ALL day.
Fortunately, board meetings for charitable organizations are the exception to the usual doom and gloom of other meetings and are vital to the ethical grounding of a charitable organization.
Principle 9 lays out a fundamental and commonsense directive – if you’ve got a board (which you must) then that board needs to meet regularly.
The board meeting is a critical vehicle for making dedicated time to guarantee transparency and ethical practices across the organization.
These are the basics you should cover when it comes to board meetings:
Governing documents
We have touched on the importance of rules in the past. State laws can vary and impact charitable organizations and their governing documents differently. Across most states, at the minimum you must have governance documents and established rules for board activities, clearly stating: quorum requirements, attendance policy, a system for notifying board members of activities/upcoming meetings, and the number of scheduled meetings.
Here’s a resource with a link to nonprofit regulations by state. It even spells out items like quorum requirements.
Delegating is fun
We have all been in a meeting where there were five too many people in the room and no substantial work was done. Boards usually form ad hoc or standing committees to continue work on specific tasks and report back to the full board.
Per usual, most states have different rules around what types of tasks can or cannot be delegated to committees. Heavy responsibilities like dissolving the organization, electing or removing directors, and/or amending governing documents usually require the full board.
Mind the minutes
For hundreds of years we have mused over the philosophical question: If a tree falls in a forest and no one is around to hear it, does it make a sound? Now we must consider: If a meeting takes place and there are no minutes, did it happen?
The answer is no. The meeting didn’t happen since there is no record of what happened or any decisions that were made.
Minutes are the easiest way to push transparency and information to the world outside of the boardroom. In fact, our friends at the IRS even ask if you have been a good board by maintaining minutes on your annual Form 990s.
Keeping great minutes is an unsung skill. Here are some tips on creating clear and concise minutes.
Executive session
There are some decisions and discussion that must happen without the CEO present, usually this time during board meetings is referred to as an executive session. This time allows the board to freely discuss and execute governance activities like CEO compensation.
The board should keep minutes and decisions that occur during these sessions and share out key highlights relevant to non-board members. All of the detailed minutes should be safeguarded by the secretary of the board.
There is no magical number of board meetings
Many boards choose to meet a minimum of three times a year, this is usually the bare necessity to stay abreast of the governance, financial oversight, program activities, and compliance across the organization.
Find a healthy balance and try to align timing with important annual events so the board is available to make decisions, such as approving an annual budget.
While some state laws dictate how many board meetings should take place in person, now there are alternative meeting methods available. As such, you don’t have to let the stress over the cost and time of travel be the deciding factor for how often your board meets.
Well, that covers the basics of board meetings, but it doesn’t mean you can’t get fancy or have some fun. Feel free to tailor your board meetings around your organizational needs. Most importantly, get excited about your next board meeting! Remember how critical it is to the continued vitality of your organization and its charitable mission.
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Learn more about Principle 9 and the associated resources.
Are we missing a great resource associated with this Principle? We want to hear that, too. Leave your thoughts in the comments and let us know what you think. You can also use #npethics on social media.
