You’ve decided to start a nonprofit or charity – Yay! Now it’s time to build a killer board.
This is no easy task, but it is essential. A good board ensures you stay accountable to your donors and your mission. They make strategic decisions that will move your organization forward, provide critical support for volunteers and staff, and bear the responsibility of fulfilling the organization’s mission for all stakeholders.
And yet.
Many nonprofits struggle when it comes to building effective boards. But fear not: we’ve worked with hundreds of benevolent organizations over the years, and have gleaned a few nuggets of wisdom when it comes to putting together a board for your start-up. Believe us, your dream team is out there and we can help you put it together
But before we get to that, let’s consider some common mistakes young organizations make in choosing their directors.
The biggest mistakes organizations make when selecting board members
Mistake #1 – Making your friends and family your only board candidates.
We love your friends and family: we’re sure they are amazing people! But when you only select board members from your inner circle, the result is an insular board without the diversity of skill and experience that makes up an effective governing body.
Mistake #2 – Only focusing on net worth.
It is true that it can be helpful for fundraising to have High-Net-Worth Individuals on your board. And many HNWIs have valuable governance experience. But at the end of the day, wealth does not automatically equal integrity, competence, or skill. Your organization will do much better in the long run – and likely raise more money – with a highly functional board than a guaranteed major gift or two from a wealthy board member.
Mistake #3 – Assuming past success equals future triumph.
So you have a connection to a former CEO of a Fortune 500 company, you lucky duck! But before you ask her to join your board, consider her strengths and personality. Will she complement those of your other board candidates? Will she further your mission and vision? A board stacked with high achievers may seem like a dream, but it can become a dysfunctional mess if each individual isn’t carefully considered against multiple criteria – not just their past successes!
Now, onto the good stuff…
What makes the most highly effective board?
How can you build a board dream team? To build the best board, we recommend looking for four things: competence, representation, diversity, and values.
1. Competence
The best boards represent a mix of skills. The exact needs vary from organization to organization, but most effective boards will have:
- The Accountant: Financial oversight and accountability is one of a board’s top duties, so having an individual who is good with finances is a must for essentially every organization. This does not have to be a professional accountant – anyone with a knack for numbers and details will do.
- The Compliance Guru: Because your board has legal responsibilities to uphold, having someone who can dot i’s and cross t’s is essential. Lawyers are natural for this role, but remember: not every lawyer has knowledge specific to the field of not-profit compliance.
- The Fundraiser: Someone who isn’t afraid to ask other people for money – and then ask them for more money. And then also ask them to volunteer.
- The Administrator: Who knows where the paperwork is? Loves a well-run meeting? This member works in the background to keep the board running smoothly so the group can focus on strategy and oversight.
- The Galvanizer: A leader who can rally volunteers, dream big, keep morale high among your stakeholders, and generally promote your cause to the rest of the world.
2. Representation
What’s wrong with this picture? An international development charity working in Rwanda with an all-white, all-Canadian board. An Indigeous clean water charity with an all-settler board. A poverty-alleviation charity with an all-wealthy board.
See the problem? Boards are making critical decisions that impact how a benevolent organization’s work impacts the community. Without representation from the community you serve sitting at your board table, you are missing crucial voices at the leadership level that will make your work more effective.
Your dream board should include representatives from the community your organization serves, or lived experience with the issues being addressed. Side note: if you’re working internationally, you’re allowed to have out-of-country board members!
3. Diversity
A few years back, a study found that homogenous teams are more prone to making bad decisions. On the other hand, being intentional about diversity, equity and inclusion can lead to positive outcomes for your organization. When choosing a board, look beyond your network to think about diversity of all kinds:
- Racial, ethnic, gender, and socioeconomic diversity where appropriate. We don’t necessarily advocate that organizations built for certain religious or ethnic groups include board members from outside that community just for the sake of it. But certainly a diversity of perspectives is a valuable asset.
- Members representing different generations.
- Experienced members who can mentor others and inexperienced members who can bring fresh perspectives.
- A mix of personalities: no one wants to be in a board meeting with only extroverts!
4. Values
While your dream team should be diverse in competence, personality, and – when appropriate – demographics, every member needs to align with the values of the organization.
Don’t be afraid to interview new potential members. Review their online presence, ask for references, and vet people based on what your board needs, not based on their wealth or connections.
There may not be one perfect board. But by looking outside your network and choosing board members with intentionality, you can build a dream team that will support the work of your organization for the long-term.
If you’re struggling to find the right fit for your board, reach out and we can help you figure out the best mix for your mission.
For more information, check out CPA Canada’s great guide to board fundamentals.
