Crisis Management – What is the proper role for a nonprofit’s board of directors?
Changes buffeting nonprofit boards of directors are increasing substantially. At the top are the widespread budget cuts from foundations and governmental organizations, along with many individual donors reducing their traditional gifts. In addition, a sudden social change, reputation decline, or a fire/flood are events, which may change a board’s engagement style with management, staff and other stakeholders.
A board’s style in such situations will depend on its seriousness. With a minor event, management can be in the forefront of responding to the situation, and all that would be needed is board overview. In contrast, a very serious event might require the board to make important management decisions daily.
Should all nonprofit boards have a crisis management plan? Should the board have a risk management committee review prospective risks and to assume some leadership, if serious problems arise? (Smaller nonprofit boards may have to rely on their national associations to offer broad templates, which can be applied locally.)
CEO & BOARD CHAIR ALERTS: At the least, do you have a plan in the event the CEO is incapacitated or leaves unexpectedly for another position? Do you need a detailed crisis management plan in place?
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