How to select a Competency-Based Board for your Nonprofit.
A path to Nonprofit Board Effectiveness
Continuing my inquisitiveness into the workings of nonprofit boards, in this blog I am focusing on the most important part of board and governance, the essence of any board — “composition of a board”. Any board composition depends on the nature of the organization and is largely influenced by the organization’s mission & vision, terms of office for directors, the size of the board, and most importantly the desired board member’s experience and skills.
I have come across so many articles on this topic but something which struck me as not just insightful but also very relatable was “Spotting and Fixing Dysfunctional Nonprofit Boards” by Alex Counts. After working with multiple boards of varied structures and nature in the nonprofit sector, my perception and analysis of what makes a board unsuccessful exactly matched Alex Count’s observation of dysfunctional boards. I can very well relate to his broad categorization
In my analysis, I am using Alex Count’s categorization — Rubber stamp, Micromanaging, Balkanized as the problem areas, and building my idea of creating a competency-based board as the solution that can lead to board effectiveness and organizational contentment. My idea of a competency-based board incorporates various departments of a nonprofit organization and is built around addressing each with the help of a competency-based leadership style.
The table below demonstrates the types of dysfunctional boards, the common problems arising out of these flaws, and a high-level solution which will be explained in length moving forward.
Building the right board and its effectiveness is directly related to the right amalgamation of skills, experience, and understanding of the board’s competencies, which is inclusive of capabilities and its alignment with the strategic direction of the organization.
ASAE Foundation’s “Body of Research on Governance” conducted a study to understand the selection practices of an efficient board which included “Board Member Competencies and Selection: Helping Associations Build a Stronger Board”. According to this study, there are five core skill areas — group skills, interpersonal skills, personal leadership skills, technical skills, and personal attributes. Based on these five core skill areas I have created a framework combining required board member competencies, various departments of a nonprofit organization, and related governance roles and responsibilities.
To avoid micromanagement, the board needs to have members with governance competencies. Governance is a blend of policies along with a strategic and operational angle to it allowing the leadership to take action and make accountable decisions. Governance competencies include strategic leadership which allows the board to plan from a governance perspective, execute performance management of the Executive Director/CEO for which an individual needs to have great communication skills, adaptability, problem-solving ability, and compliance.
To deal with balkanization, the board needs to have members with technical competency which is an individual’s technical skills and experience. For example, industry knowledge, professional experience, experience in more technical areas like finance, risk management, strategic planning, expertise in areas including DEI, risk management, etc. These will allow them to be more inclusive of different parts of the organization in the oversight function without being overly dependent on the Executive Director/CEO.
Finally, to increase board engagement, behavioral competencies play a major role. These competencies are a board member’s attributes like an ability to positively influence situations, commitment, passion, honesty & integrity, and high ethical standards. These personal attributes are critical to boards’ successful operations.
The composition of a nonprofit board involves both structural and cultural issues and its effectiveness depends on obtaining the right mix of competencies and experience. This varies significantly between organizations. That’s why it is crucial that before the appointment or nomination of board members, the senior management should consider these competencies, evaluate what competencies and skills each incumbent director possesses and finally consider the character of directors and their fit with the current board culture.
Reference
1. Brown, W. Mark, E. FASAE.CAE. Recruit the Right Board: Proven Processes for Selecting Critical Competencies. 2019.
2. Counts, A. Spotting and Fixing Dysfunctional Nonprofit Boards. Stanford Social Innovation Review. October 2020. Available at https://ssir.org/articles/entry/spotting_and_fixing_dysfunctional_nonprofit_boards#bio-footer
