The answer to the question of whether the CEO, often called an executive director in nonprofit organizations, should be a voting member of the board of directors is found in defining the role of the CEO and the role of the board.
The leadership role of the board is to define why the organization exists, what good is created, who or what will benefit, and at what cost that good will be created. Once they define this organizational result, it is to monitor the extent to which that change is effected in the world and that unacceptable situations and circumstances are avoided. The board’s work is thinking work. It demands discipline, intellectual vigor, and unconflicted commitment to the cause of the organization that is served.
The leadership role of the CEO is in operations—leading the staff of the organization to accomplish the results required by the board and to avoid unacceptable actions even if they work. Authority to get the job done and accountability to the “moral ownership” of the organization through the board of directors define the CEO’s role.
With this clear definition of roles, the CEO has the authority necessary to be a strong leader in the organization. He or she is likely the most informed expert at the table during any board or committee meeting regarding any topic related to the operations of the organization. When the CEO has both the authority and accountability that is clearly articulated and understood there is no reason that a vote on the board would be an effective tool for persuasion whether that vote is in the majority or minority of the board’s vote on any given decision. This is the case with the founding CEO or one that the board has hired.
I recommend that nonprofit boards use a comprehensive model of governance from the beginning whether they consider themselves a “working” board or a policy board. The only thing that a board in name only does is it sends the message to the IRS and congress that the nonprofit world needs more regulation from the federal government. That is not a good plan for governance. The responsibilities required of any board and the servant-leaders that populate them is important and one that should be well considered. The relationship with the CEO is to be both safe and empowering.
It would be great to talk further about the foundational function of the board of directors in your nonprofit organization. Please feel free to contact me directly.
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