How is trust developed between the nonprofit board chair and the chief executive?
By Eugene Fram
First, in order to maintain trust between the board chair and CEO, the chair must be certain that the evaluation of the organization and the performance evaluation of the CEO are inclusive, i.e., cover a balance of the most relevant outcomes. Otherwise, the evaluation outcomes have the potential to damage the trust relationship that’s necessary to drive organizational growth. Balance can be achieved by involving the CEO in developing the quantitative and qualitative outcomes/impacts by which s/he and the organization will be evaluated. The quantitative ones to be negotiated are based on available records such as: financial, membership, clients served. Qualitative ones, such as community impact, can be evaluated with imperfect metrics, agreed upon by the CEO and Board. These metrics can be robustly developed over time to assess progress and drive change.
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However, if the evaluation needs to have a probationary tone to it, and the CEO is being given time to improve performance, the chair needs to take steps to reduce unproductive tensions. Hopefully the CEO’s performance will improve – or, alternatively, there’s a decision made that it is time to change the CEO.
Second there is the problematic situation where the chemistry between the board chair and the CEO isn’t good. Let’s say the CEO is politically liberal and the chair is politically conservative. In cases like these, boards often have trouble maintaining civil discourse at meetings. The CEO needs to be strong enough to have a frank talk with the board chair to resolve the situation.
Third is the need for an essential ingredient in the organization’s culture, the CEO’s ability to be flexible. He or she needs to accommodate to a new boss every year or two. Consequently, the CEO can’t be complacent. He or she needs to be alert, to recognize when the board – often initiated by the chair – wants to move in a new direction.