The Nonprofit CEO Exceeds The Authority Boundary – What Happens Then?
By: Eugene Fram
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It happens! When it does, it’s the board’s job to inform the CEO that he or she has taken on too much authority. As a board chair of a human service nonprofit, I encountered such a situation. The CEO signed a long-term lease contract on his own that should first have been approved by the board. The financial obligations involved weren’t significant. When the CEO recognized his error, I then asked for formal board ratification. None of us does out jobs perfectly. But a CEO has to recognize the board’s ultimate authority for long-term contracts and similar issues, even when the financial obligations are insignificant. Obviously, if the CEO continually takes such actions, there is a serious communication problem. (more…)