Trustee Board Organization

The truth is that ALL nonprofits are actually businesses. And–they need to.be run like a business.

Sylvia Helper of Launching Lives commented to one of my recent blogs tilted : “What’s in a Name? Benefits of the Nonprofit President/CEO Title”    

“While this irritates and offends many nonprofit senior staff, the truth is that ALL nonprofits are actually businesses. And–they need to.be run like a business.”

Sylvia: I strongly agree with your statement. Too many board and staff members in the nonprofit environment ……

Do not realize that a nonprofit can focus even more effectively on “caring” missions, visions and values while operating under a business model.

Mistakenly conclude that using business titles (such as CEO) appears more prestigious than is merited. This mistaken attitude persists in organizations with well over 15 employees and budgets well over $1 million!

Associate business boards with financial disasters such as Enron and Tyco, while failing to perceive the business board model’s benefits, such as having only a few standing board committees.

Fail to appreciate  that today’s nonprofit managers must have the tools of professional executives to lead their organizations towards accomplishment.

Choose to continue to implement the 20th century governance practices in which staff members, often without the requisite managerial expertise, are promoted to chief executive positions.  A few succeed by growing into the job but  most continue on to do little more than “mind the store.” Truly, this can result in a significant waste of board and staff resources.

After many years of participating in nonprofit activities as a volunteer director, consultant and author, I recognized how the adaptation of a business model will positively impact the governance of a nonprofit. This prompted me to write “Policy vs. Paper Clips” which, based on sales of the first two editions, has influenced thousands of nonprofits to convert their governing structure to the model described in the book. The third updated and expanded edition was published in 2011 http://amzn.to/eu7nQl     .

My blog site http://bit.ly/yfRZpz  now contains over 100 blogs on nonprofit governance.

In summary, many nonprofit boards, managers and staff figuratively stand ten feet tall for what they accomplish.  They deserve to have the better aspects of business boards and business venues to do their jobs. 

 

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Nonprofit chief executives should have a title, President/CEO

Nonprofit chief executives should have a title, PRESIDENT/CEO

By Eugene Fram

When nonprofit organizations reach a budget level of over $1 million and have about 10 staff members it is time to offer the chief operating officer the title of PRESIDENT/CEO.  In addition, the title of the senior board volunteer should become CHAIRPERSON OF THE BOARD, and the title of EXECUTIVE DIRECTOR needs to be eliminated.   Experience has shown that with a reasonably talented PRESIDENT/CEO at the helm, he/she can provide the following benefits:

  • Build a trust culture between board, management and staff.
  • (more…)

How Often Should a Nonprofit Audit Committee Meet?

How Often Should a Nonprofit Audit Committee Meet?

By Eugene Fram

            Under “usual” conditions, the audit committee should meet at least twice  a year, once just before the annual audit to understand how the audit is going to be conducted and then after the auditor’s management  letter has been received.  If other major issues arise, such as a major change in the organizations pension plan, more meetings will be required with outside counsel ,  experts  in  the area being discussed. 

Part of each meeting with the external auditors is held in executive session.  This is one of the few times that management is excluded  from a meeting.  Some boards, in recent years, however, devote some part of most meetings to an executive session.   (more…)