Dani Robbins is the Founder & Principal Strategist at Non Profit Evolution located in Columbus, Ohio. I’ve invited my good friend and fellow non-profit consultant to the first Wednesday of each month about board development related topics. Dani also recently co-authored a book titled “Innovative Leadership Workbook for Nonprofit Executives” that you can find on Amazon.com. 

Governance: The Work of the Board, part 3

Setting policy

By Dani Robbins

Welcome to part three of our five-part series on Governance. We have already discussed the Board’s role in Hiring, Supporting and Evaluating the Executive and Acting as the Fiduciary Responsible Agent. Today, let’s discuss the Board’s role in setting policy.

As previously mentioned, Boards are made up of appointed community leaders who are collectively responsible for governing an organization. As outlined in my favorite Board book Governance as Leadership and summarized in The Role of the Board, the Fiduciary Mode is where governance begins for all boards and ends for too many. I encourage you to also explore the Strategic and Generative Modes of Governance, which will greatly improve your board’s engagement, and also their enjoyment.

At a minimum, governance includes:

• Setting the Mission, Vision and Strategic Plan,
• Hiring, Supporting and Evaluating the Executive Director,
• Acting as the Fiduciary Responsible Agent,
• Setting Policy, and
• Raising Money.

One of my goals for this post is to rectify the common practice in the field of people telling nonprofit executives and boards how things should be done without any instruction as to what that actually means or how to accomplish it.

What setting policy means is:

The board discusses and votes to approve (or not) all policies and plans. Policies are usually recommended by (and often written by) the CEO, also called the Executive Director. Plans are usually drafted by committee. Both must be approved by the Board.

Procedures, on the other hand, are set by the CEO, often in consultation with the staff. The difference is the difference between the rules and the law. You can get fired for violating a policy (law), but not usually a procedure (rule).

Policies, plans, and procedures set the boundaries for people to act.

I recommend organizations have the following policies:

• Personnel
• Financial
• Crisis Management and Communication
• Conflict of Interest
• Confidentiality
• Whistle Blowing/Ethics

Policies dictate what happens in defined set of circumstances. I occasionally get calls from people who want to create a policy they don’t really need because they are trying to avoid addressing an issue directly. Do not create a policy to avoid having a conversation. Have the conversation, and then decide if you need a policy.

That said there are policies you definitely need.

For example (and among other things), the personnel policy determines what benefits staff get; the financial policy sets who can sign checks and for what amount; the crisis communication policy determines who speaks for the organization; the crisis management plan dictates what to do if there is an intruder; the conflict of interest policy states how conflicts are managed; the confidentially policy requires a process to protect information; and a whistle blower policy provides a path to report violations.

A reporter sticking a camera in the face of your most disengaged staff member is not the time to decide who speaks for your organization. Having a crisis communication policy will make all the difference in the organization’s ability to continue to provide services after a crisis, and the community’s ability to be confident in your ability to do so. The absence of a single point of contact allows for a variety of messages from a multitude of people — who may or may not be affiliated with your organization — to be shared with the community, which at a best will dilute your ability to control the story and at worst will open the door to a new set of issues for people to judge you by. As all of our moms taught us, a reputation takes a lifetime to build and just a few minutes to destroy.

Policies address today. Plans take you into the future.

I recommend organizations have the following plans:

• Board Development
• Marketing
• Resource Development
• Strategic Plan
• Succession Plan

Plans determine what path you will follow in what circumstances.

For example (and among other things), a Board Development plan dictates what process will be followed to bring on new Board members; a marketing plan determines what materials you will create and how they will be disseminated; a resource development plan lays out how you will raise contributed income; a strategic plan states where you are going as an organization and how you plan to get there; and a succession plan ensures continuity by outlining how leadership will be perpetuated.

Plans, policies and procedures can address or eliminate many of the issues that come up on a day-to-day basis that distract from your mission and moving the needle for your community.

What’s been your experience? As always, I welcome your insight and experience.