How Nonprofit Board Members/Management Can Make Sense of Sustainability
By: Eugene Fram
I recently read an article published in April, 2011 issue of the “Nonprofit Quarterly” by Jeanne Bell, titled “Beyond Financial Oversight: Expanding the Board’s Role in the Pursuit of Sustainability.’ I think the suggestions in it will be of interest to nonprofits whose budget expenditures are mainly centered around staff and programs and less on maintaining material & real estate.
First, the article calls for the establishment of a board Finance & Sustainability Committee not only to focus on past results but to… “be anticipating the next several quarters, too.”
Second it calls for nonprofit boards to spend more time on generative thinking 1, answering what if questions. Examples: Museum Board – What are the long-term impacts of selling long undisplayed antiques to private dealers? Children’s Residential Organization Board – To what extent might we also provide living facilities for the elderly?
The establishment of the dual committee achieves what my governance model http://bit.ly/yfRZpz has long suggested, i.e., only two standing board operational committees (1) an assessment committee that oversees financial and program assessment and (2) a planning and resource committee that has, in Bell’s terms, sustainability as one of its major responsibilities. An executive committee is the only other board standing committee.2
In addition, the article calls for
• All board members to be financially literate.
• Adding nontraditional members to the finance & sustainability committee who can ask “why” programs exist.
• Board understanding of why some deficit generating programs continue to exist.
• Board members to fully understand the business model the nonprofit is using.
1. William Ryan, Barbara Taylor & Richard Chait (2004) “Governance as Leadership: Reframing the Work of Nonprofit Boards,” New York City, John Wiley Company.
2. See third edition (2011) of “Policy vs. Paper Clips.” Available on Amazon.com in paperback and Kindle format. http://bit.ly/yfRZpz