Nonprofit organizations (NPOs) are created to address specific issues/problems/needs and serve specific communities/constituencies, and the primary role/responsibility of the Boards of those NPOs is to represent (the issues/problems/needs of) those communities/constituencies.
A Board does this by ensuring that the NPO’s mission is consistent the reason(s) that organization was created … and by adapting that mission to the ongoing needs of the community being served; by establishing policy on how the business affairs of the organization are to proceed; by selecting, evaluating the performance of and (when needed) replacing the chief executive officer; and, by providing the resources needed for the CEO to pursue the mission.
Now, simply put: When the Board Members of a Non-Profit Organization do not have specific term limits, and some-or-all of the same people continue to serve without limit, the Board, over time, is likely to become less representative of the community. There are three common reasons this happens:
(1) Boards get used to doing things their way;
(2) Board members only think important those things that they think are important; and,
(3) Their focus is on providing service to those to whom they provide service.
That was not intended to be cryptic. It is merely a way of saying that a board without term limits has no requirement, no major incentive, to re-examine, change or broaden their mission and/or their activities and services.
When most organizations are created, board members tend to be very similar in attitudes, outlook and concern about a particular problem. They tend to come from similar cultural, ethnic and/or experiential backgrounds, and they focus on what they know. Eventually, because of the limited scope of their vision, they can lose contact with what’s going on and what might be needed in the broad community.
Of course, “eventually” may differ for different communities. For some communities, where people and/or circumstances are visibly changing, board tenure should not exceed two terms of three years. Where change occurs slowly, three terms might be reasonable.
Representation requires consideration of a number of elements, from the changing demographics of the community, to the skills an individual brings to the position, to the relative ability of the Board Members to help the corporation obtain the resources it needs to operate at optimum levels.
Often the Members of a Non-Profit Board get comfortable doing things a certain way, but Board Members must understand that their responsibility is to act in a way that is best for the community. The manner in which a board of trustees operates is not for the convenience or comfort of its members, it is to ensure that the interests of the community are being served and protected.
Nothing stands still — everything changes, including our communities, and a nonprofit Board must change with its community. Only a Board that maintains its vitality can function at its best. New blood brings different perspectives, different attitudes and different skills, all of which may be needed for a changing community.
Term limits are an essential ingredient in maintaining a Board’s vitality. Any Board that insists that term-limits are not necessary for them, for whatever reason, is acting on the basis of its own needs, and not out of consideration for the community they are supposed to be serving.
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Have a comment or a question about starting, evaluating or expanding your fundraising program? Contact Hank@Major-Capital-Giving.com . With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, he’ll be pleased to answer your questions.
— By Guest Writer, Bert Doerhoff, CPA
