To avoid legal liability and reputational harm, nonprofits have to do more than adopt a conflicts of interest policy; they need to use it.
Nonprofit boards of directors consist of people who are successful, care about the organization, and are often passionate about the mission. Yet, both board members and executive directors often lament that the board is not as engaged and as useful as it could be. To change that situation in your board, start by asking yourself whether you have defined the expectations of the position.
As the calendar is turned to a new year, embrace the moment and resolve to address some important issues facing nonprofit boards of directors in 2018.
Should you limit how long someone can remain on your nonprofit board of directors? In William Meehan and Kim Starkey Jonker’s 2017 book Engine of Impact, the authors rightly address this question in the context of board member assessment. That is, term limits are really a way for an organization to shed itself of poor performing board members while side-stepping board evaluations. But requiring board member removal means losing benefits that long-standing board members can bring.
Good governance practices are associated with lower fraud occurrences and, if a theft or embezzlement does occur, a quicker recovery. That’s the finding of a trio of researchers who used four years of IRS Form 990s to test the impact of governance on nonprofit organizations’ ability to avoid and weather asset diversions.
The Wells Fargo fake-accounts scandal led to $185 million in fines, the resignation of CEO John Stumpf, and the firing of some 5,000 employees. In the midst of that fall-out, the company’s independent directors released the results of an internal investigation that provides food for thought for leaders in all types of organizations. Three lessons emerge for leaders seeking to prevent unethical behavior and encourage good decision making within their team, department, or company.
The public expects that nonprofits will be accountable for achieving some public good. But who should judge that achievement? That’s another way of asking: to whom should nonprofits be accountable? Helpfully, researchers have provided new ways of understanding the multiple meanings of accountability.
You are thinking of starting a nonprofit: you have passion, expertise, and perhaps even a small group of supporters. What challenges will you face as you launch this new organization? Researchers at Syracuse University provide insight into that question in a survey of some 1,000 nonprofit organization founders.
Given that there is scientific consensus that human-induced climate change is happening and that its effects on humanity will be severe, why haven’t we been able to galvanize society to address this extreme threat? Even more basically, why have so many Americans continued to deny the severity of (or the existence of) climate change? To address these shortcomings, those leading the efforts to address climate change should create and advance a positive vision for the future, that is, a clear, optimistic picture of what the world could look like if we rose to the challenge of addressing climate change.
For many charities, state regulatory filings are somewhat of a mystery: who are these regulators, what do they require, and what happens if we haven’t complied? Earlier this year, the Urban Institute and Columbia Law School issued its analysis on State Regulation and Enforcement in the Charitable Sector to try to answer these questions in broad terms. It’s an insightful look into a system that is often opaque.
We’ve been wrestling with the functions of nonprofit boards ever since the start of the American experiment. That historical view provides a valuable lens for considering what responsibilities should be expected of today’s nonprofit boards of directors. And starting with a historical look is a fitting kick-off to this new blog, which seeks to distill scholars’ research into quick and useful lessons for nonprofit practitioners.