Board Composition, Independence, and Officers

Board Composition

A nonprofit board should be comprised of individuals who have the necessary skills, expertise, and diversity to effectively oversee the organization’s operations, strategy, and risk management. When establishing or filling board vacancies, it is extremely helpful to first define what you need. When you know what you are searching for, it is easier to find. Start by creating a board matrix that lists the intellectual and other contributions your desired board should possess. This exercise will help find any gaps to be addressed.

Here are some elements to consider when selecting board members:

Passion

Without genuine interest in the mission of your organization, a board member has difficulties connecting to the basic purpose of your existence. A board member is not a "direct service volunteer" who gets fulfillment from the daily activities and from seeing immediate results. A board member needs to lead the organization at the strategic level, where results sometimes take months or even years to manifest themselves. If that connection is missing, it is also more difficult to find commitment, the following element.

Commitment

To serve on a board requires time and a desire to participate actively in the board's work. If your board member candidate cannot make this commitment outright -- after you have clearly explained the expectations -- you would simply be adding a name to your board roster without additional benefits. Board service does not simply mean meeting attendance. Commitment assumes a capacity to take on additional tasks, serve and lead committees, participate in fundraising if your organization solicits funds, make a personal contribution, and above all, actively participate in deliberations and provide wisdom to the board room discussions.

Financial literacy

Probably the toughest requirement for a full-fledged board member is familiarity with nonprofit finances. The expectation is not for every member to be a financial wizard, but basic knowledge is a must as the board has a fiduciary duty to ensure the financial health of the organization. Without the ability to assess budgets and read financial statements with a critical eye, a board member easily becomes a follower who approves financial documents without understanding what they represent.

Legal awareness

Nonprofits are legal entities. The board is the accountable body for the organization. Board members have legal obligations and even potential personal liabilities vis-à-vis the nonprofit corporation. It is essential that each individual board member understands his or her legal duties and how the organization can suffer from non-compliant actions or omissions.

Governance understanding

Finally, board members need to understand governance. One of the responsibilities of an effective board is to take care of itself, tend to its own well-being and education. If board member candidates have no clue about their future roles and responsibilities, the entire "system" will veer off the good path and individual board members may assume functions that may not be appropriate to them. Equally, it is fair to expect that board members are sensitive to group dynamics and manage to relate to their peers just as that: colleagues who provide a diverse point of view to board deliberations.

Independence

Board members should act independently and avoid conflicts of interest that could compromise their ability to act in the organization’s best interests.

Financial or Personal Interest

Independent board members should not have any significant financial or personal interest in the organization. This helps to ensure a board member’s decisions and actions are not influenced by personal gain.

Conflicts of Interest

Board members, particularly those in leadership positions, should disclose any potential conflicts of interest and recuse themselves from decision-making processes when conflicts arise. Independent board members play a crucial role in scrutinizing potential conflicts and ensuring transparent and fair decision-making. 

Board Officers

Board officers are individuals elected or appointed to specific positions within a board of directors. These officers have specific responsibilities and duties that help facilitate the functioning of the board and ensure effective governance. The specific roles and titles of board officers may vary depending on the organization and its governing documents, but typically includes the following positions:

Chairperson
The chairperson is the leader of the board and presides over board meetings. They are responsible for setting the agenda, conducting meetings, facilitating discussions, and ensuring that the board operates efficiently and effectively. The chairperson also acts as a liaison between the board and management, represents the board to external stakeholders, and sometimes plays a key role in strategic planning.

Vice Chairperson

The vice chairperson assists the chairperson and may act as their substitute in their absence. They often have specific responsibilities delegated to them by the chairperson, such as leading board committees or overseeing specific projects. The vice chairperson provides support to the chairperson and helps maintain board continuity and leadership.

Secretary

The board secretary is responsible for documenting and maintaining accurate records of board meetings, including minutes, resolutions, and other important documentation. They ensure that all necessary legal and regulatory requirements related to the board’s activities are met. The secretary may also handle correspondence, maintain board member information, and facilitate communication between the board, management, and stakeholders.

Treasurer

The treasurer oversees the financial affairs of the organization and provides financial expertise to the board. They are responsible for ensuring the accuracy and integrity of financial reporting, budgeting, and financial planning. The treasurer often chairs or participates in the board’s finance or audit committee and assists with financial decision-making and risk management.

This is not an all-inclusive list; every board can create additional positions that help it do its work in a more efficient manner. The duties of officers need to be described in the bylaws to clarify the levels of authority as officers often have specific rights to represent the organization and sign documents.