How to build an effective board

Last time round we talked about how to build a high performance organization and concluded that it can’t be done without a good board. So how about that board? I hear you cry. Who should be on it? What training will they need? What specialist knowledge should they have? Turns out there are a few things to think about on this topic  too. For these I am indebted to an excellent article by Ernest E. Boyd, CAE and Harles Cone of the Ohio Pharmacists Association, the type of professional body for which this information is well suited.

First up, it’s important to clarify the roles of board members. Make sure prospective candidates know that their job will be to shape the vision and values of the organization and ensure that it meets its long-term goals. This is not about getting involved in day-to-day management tasks.

Next, make sure your board has people with different types of experience. You’re looking for a diverse range of opinions, attitudes and values. In this way you’ll be making sure your board truly represents your members. Having said that, the board should make sure it focuses firmly on the issues, not the personalities of its members. Healthy discussion, debate and disagreements over strategic decisions are good. Personal attacks and backstabbing are not.

Board members should have a good understanding of their financial and legal obligations. It’s a good idea to invite your accountant and/or lawyer to a meeting or two to explain what these are. To put it very, very simply, a board member’s financial obligations are that they should understand enough about how the organization manages its money to know when it’s not happening properly. When it comes to the law, board members should understand their duty of care, which means that they must be informed, must participate, and must act in good faith. They should also understand their duty of loyalty, which means that they must exercise their power and actions for the benefit of the organization.

Training board members appropriately will require an investment of time and probably money to make sure they have what Boyd and Cone call “an enhanced set of skills and knowledge.” If the cost of hiring facilitators, producing materials and renting off-site venues has you worried, think about the potential costs of not doing training at all. Many an organization has been brought to its knees by financial mismanagement, legal misdemeanour or plain old bad governance. This is the kind of stuff that can see your organization lose its reserves of cash, its reputation and the goodwill of its members.

An effective board whose members know their options is your insurance against bad things happening. So, as we head into the New Year (and I wish you a very happy and prosperous one, by the way!), I would suggest a review of the makeup of your board and its core competencies – it’ll be time and money well spent.