coming to terms with your Board
Joan M. Renner, CPA, CGMA, Director 501(c)(fit!)
Do your Board members have term limits? This came up at last month’s 501(c)(fit!) financial leadership training seminar, and our participants compared notes. Many participants did have term limits for their Board. Some did not.
A recent survey of more than 1700 nonprofit leaders found that today about three out of every four Boards have limits on how many consecutive an individual member can serve. * This has not always been the case, but over the past 20 years there’s been a trend toward having term limits for Board service.
Term limits make room on your Board for new members which may help you maintain a more current perspective. New Board members bring new contacts, ideas and skills and help provide for leadership succession. Allowing long standing Board members to cycle off gives them a graceful way to depart, and can help “re-balance” Board influence.
Why give up the talent we already have? Some of our participants were worried that term limits would limit their access to talented Board members who were willing to serve. If your pool of willing individuals is small, you should probably analyze that condition a little further and see what dynamic is holding everyone back.
Board talent is a scarce resource, but it’s a resource worth cultivating. Strong nonprofits have the ability to mobilize resources by inspiring others to contribute, not only with money but also with their time and talent.
What can we learn?
The most common term of Board service is three years. *
The most common limit on the number of terms a director can serve is two, three-year terms. *
Remember to recognize your departing Board members with some expression of gratitude for their service. After all, they’re your alumni.
You don’t have to say goodbye to your current Board talent. You can invite departing Board members to stay involved on an advisory Board or a special project.
If you’re ready to add limits to your Board terms, you’ll need to amend your bylaws. Your existing bylaws can tell you the process for making the change. You don’t want everyone’s term to expire at the same time, so stagger the terms so that about one-third of your Board renews or terms out each year. This will help maintain continuity.
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*Yes, it’s true per BoardSource’s new survey, Leading with Intent: 2017 National Index of Nonprofit Board Practices.
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