Nonprofit Board of Directors have a fiduciary duty to exercise, at a minimum, financial and legal oversight, Executive Director & board oversight and adherence to mission oversight. There are a number of steps a nonprofit organization can undertake to ensure effective nonprofit board oversight:

  1. Recruit board members with the time and skill sets that contribute to a well-rounded board- Board member prospects should have the qualities and abilities that the organization needs. Age, gender, race, ethnicity and location should be considered. Additionally, basic knowledge competencies such as accounting, human resources and legal skills should be considered. It is not enough to just find people who are willing and able to serve or raise money. Collectively, Board Members must possess the various areas of expertise needed for effective governance.

  2. Train members on their roles and responsibilities- All board members should understand the core duties of care, loyalty, obedience and concepts of conflict of interest. However, there is a strong need to train board members in their finance and legal responsibilities. Too often board members do not understand the financial position of a nonprofit organization until it’s too late.

  3. Take Good minutes- This can actually be more challenging than it seems. It’s important that too much details do not obscure the meetings important matters discussed. Whenever a decision is made, it’s especially important to record the names of board members who voted against the decision.

  4. Set the yearly board calendar appropriately- meetings should be scheduled so that key decisions can be made at the appropriate times. For eg. if the Board needs to review the annual financial report before it is issued in February, it is pointless scheduling quarterly board meetings in December and March. Also, be sure to consider the potential need to align full board meetings with certain committee meetings.

  5. Address board members who aren’t performing or contributing- Board members should not be allowed to stay in their role if they do not show up to meetings, fail to prepare for meetings or do not possess the expertise that contributes to the board’s effectiveness. Nonprofit organizations should know how to exit board members appropriately when that becomes the right thing to do.