The board of trustees serves as a charity's guiding force in virtually all respects — its funding, policies, programs, and operations.
Nonprofit boards serve a valuable civic role in our society, and membership is much more than an honorary appointment. A board of trustees oversees all areas of an organization, including the following:
- Fiduciary. The board's most visible role is making sure that an organization has the necessary funds for operations and programs. Trustees are obligated to protect and account for all assets and approve all fundraising efforts.
- Legal. The board must ensure that the charity operates in the public interest, in keeping with its mission.
- Management. Board members are responsible for the management of the organization and, collectively, have the power to hire or remove the chief executive or executive director.
- Vision. The board sets the vision and tone required to cultivate goodwill among donors and the general public.
Governance and composition
- Size. The optimal size of a nonprofit board depends on the needs and purpose of the individual charity. A larger board size may be an indication that the board serves as an important networking arm of the organization's fundraising efforts. Smaller boards could reflect more limited financial resources, or that the board does not serve in a fundraising role.
On mid-size and larger boards, leadership typically rests with an executive committee, including a chairperson, vice chairpersons, treasurer, and secretary. The executive committee may exercise the powers of the board when the full board is not meeting.
- Credentials. Board members should be chosen for their expertise and other resources. One way to assess their credentials is to identify professional designations or business and academic affiliations that would serve the organization.
- Compensation. Most board members of charitable organizations are not compensated, although they may be reimbursed for incidental costs such as travel expenses. The chief executive officer, however, frequently is a paid staff member.
- Term length. Tenure of board members varies from organization to organization. Some charities impose a two-consecutive-term limit and require a one-year hiatus between reappointments. Others stagger terms of service to keep the board fresh while not depriving it of veteran leadership.
- Conflicts of interest. A conflict may exist when the personal interests of any trustee or family member may be seen as clashing with the welfare of the charity. Some superficial conflicts, however, may not be easily avoidable. If you have concerns, ask the charity about its efforts to address conflict of interest.