What are Directions for a Board of Directors

May 13, 2008 9:58 AM

What does a "Board of Directors" do?

I am doing research as I am in the process of starting a non-profit. Having a Board of Directors seems to be required. What are the general responsibilities for a Board of Directors?

posted by goalyeehah to law & government (12 comments total)

Depends on your bylaws. The bylaws state the roles and responsibilities of the Board, as well as laying out how many board members there will be, what the officer titles and responsibilities are, etc.

Generally, the board oversees spending, the executive director, and longterm planning.

Really, really...it depends on your bylaws.

If you have more specific questions, feel free to hit me up.
posted by TomMelee at 10:09 AM on May 13

We just went through this process. The purpose of the BOD will vary according to what your purpose is. Our BOD is not really advisory - it's active, the members all have real roles, things that they have to do - but we are very, very small and have a very, very defined mission.

California Lawyers for the Arts appears to be the California analogue to the Georgia org that we used. I can give you no better advice than to seek advice from an attorney - not that in order to know the purpose of your BOD but just generally with doing this at all.
posted by Medieval Maven at 10:14 AM on May 13

If you enter your question, "What are the general responsibilities for a Board of Directors?" into google you get a page titled Sample Board of Directors' Responsibilities. That might be a start.

Googling "board directors non-profit" brings up a lot of other resources that discuss other aspects of this, like how a board is composed, which decisions it should make and which should be left to the staff, how a board makes decisions, and how senior staff should work with a board.
posted by RandlePatrickMcMurphy at 10:20 AM on May 13 [1 favorite]

Depends. The board of directors (for a non-profit housing cooperative) that I served on had roles that were required by HUD (through whom we got our mortgage) and state law, and were further defined by the by-laws. Basically, we were legally responsible for the running of the co-op, and set budgets, approved staff and programs, dealt with the property management company, fielded member concerns…
posted by klangklangston at 10:25 AM on May 13

You know, you might do well to check out a book on the subject, since there are likely other issues you'll need help with -- ones you haven't even thought of yet.
posted by amtho at 10:42 AM on May 13

There's a big difference between what they're required to do by law and what any given board might do. The requirements are basically to show some common sense in keeping an eye on what the org is doing to prevent neglect or fraud. A board is like the babysitters hired by the investors, or in the case of a non-profit, by the supporters.
posted by rokusan at 11:07 AM on May 13

As those before have said, it depends on your bylaws. The board of the organization I work for is an active board that does some very hands on work for the organization. However, I know of other boards that are in more of an advisory position or general support position.

A thought to consider as you're creating your bylaws is if there is a buy-in policy for your board. Do they have to provide money to the organization because they are on the board?

You don't mention what type of non-profit, but if it is an Arts related non-profit, check out your local Arts and Business Council. They're a great resource for this sort of thing, and I've attended workshops on board development hosted by the Arts and Business Council of Miami. I'm sure that there are other similar organizations devoted to helping out non-arts related non-profits, I just don't know what they are.
posted by JustKeepSwimming at 12:52 PM on May 13

To serve as an example...
I am on the board of directors for my college's branch of the Red Cross. Our bylaws (from the college, for community service organizations) stipulate a president, vice president, secretary, and treasurer. Over the last few years, we have added to that as we've seen fit, to fill needs in the club.

In addition to the big four, we have:
-fundraising directors (two, who work either jointly or can choose to separate campus and community efforts)
-a publicity director
-a special events director (in charge of organizing volunteers for service events and setting up those events)
-blood drive director
-health and safety director (cpr/first aid courses, etc)

To echo what others have said, you need to first meet the requirements by law. From there, you need to decide what your organization is going to do, and how you can most efficiently delegate tasks. Make sure there is at least one person in charge of every major branch.
posted by phunniemee at 1:46 PM on May 13

As mentioned, there are various answers to this, but the central irreducible responsibility of the Board is to monitor the executive officer and decide whether he's doing an acceptably good job, and to replace him if not.

Ideally the executive officer does a sterling job and the board never has to exercise this power, but life isn't always ideal.

Also, if the executive officer retires or dies or voluntarily resigns, it's the board's duty to find and hire another.
posted by Class Goat at 2:54 PM on May 13

More generally, in addition to the other comments, the board of directors are the representatives of the ownership of the company, whose responsibility it is to guide the management of the company. In the case of an unowned NFP there are no owners, just a mission.

Either way, they oversee the operation and have a fiduciary responsibility to it.
posted by gjc at 3:49 PM on May 13

The American Bar Association publishes some guidebooks that you might find helpful. Here's a link to their guidebook for non-profit BODs. It's also on Amazon.com (much less expensive - same book).
posted by belau at 4:46 PM on May 13

In the case of an unowned NFP there are no owners, just a mission.

WEll, not quite: the owners (in the US) are the American people, specifically the people of the state in which the organization is founded. The Board of Directors, in the legal sense, IS your organization. They oversee the charter that the state grants you which authorizes you to operate as a not for profit corporation and to be eligible for tax exemtion. As such, they are responsible to the public to see that your organization fulfills the mission for which it is established and doesn't break the law in doing so.

At the practical level, boards can be a leadership resource for your organization (for instance, often you want a lawyer, a finance professional, an academic in the area of your mission, a medical professional, etc) to help provide guidance for your decisions. They are also often the means of governance of the organization. They write, amend, and live by the bylaws. Usually they conduct regular meetings to review your finances and act in an advisory capacity.

If you have to have a board, have a good and healthy one. There are good ways and awful ways to develop a board. A bad board can doom an organization. A good board can launch it.

One great resource: BoardSource. There are loads more online and in the library. Talk to people you know who work in NPFs or call a few that you admire and ask about their board structure. Don't do this in a perfunctory way - it could come back to bite you.
posted by Miko at 5:28 PM on May 13