Nonprofit board structure

Last month we looked at the eight critical functions of an effective nonprofit board. This article will focus on the various types of boards one often encounters and the type of board that is more effective for a given organization. Organizations go through stages of development, and their boards evolve as well, often belatedly. Since many community and business leaders sit on nonprofit boards or run organizations, this review of the different types of boards will help you determine the best type of board for your organization, or the type of board you need to become.

The Operations Board (or Programmatic Board)

When an organization first begins, it often has no choice but to start with an operations board. The organization is small, may have no staff or only one founder, and thus an operations board is essential to develop the organization. Operations boards generally perform much of the work of the organization and are deeply involved. Membership organizations or nonprofits that heavily rely on volunteers sometimes also have these types of boards, or they expect board members to serve on active sub-committees that do the work of an otherwise absent or over-worked staff member. The principle challenge of an operations board is when it doesn’t grow with the organization (and staff) and thus becomes a roadblock to progress (see the “micro-managing board” below).

The Advisory Board (or Representative Board)

Advisory boards exist to serve the needs of the executive director by providing advice and non-binding recommendations. A strong founder-led organization often starts with an advisory board since the founder wants to control the development of the mission and programs of the organization. Some businesses that are privately owned also have advisory boards at the request of the owners to help them expand their business expertise or offer counsel.

Advisory boards become problematic when the organization moves into second-generation leadership or the board desires to become more of a governing board (while the executive director wants to retain control). A variation of the advisory board is the representative board often used by constituency-serving associations or civil service organizations. In this type of board, members are chosen for their ability to represent the interests of a constituent class.

The Governance Board

Most nonprofit board experts would declare the governance board as the most mature and strategic of all board types. Governance boards can oversee the organization through policies governing the results to be achieved (ends) and the ethical and behavioral limitations. This type of board is often called a Carver policy governance board (after the developer of the model, John Carver). Governance boards may also be strategically focused (as opposed to operationally focused) as they define the strategy for the organization and evaluate its programs and services against that strategy. Governance boards accept stewardship responsibility for and hold themselves accountable to the stakeholders for the organization’s performance. Board members of this type of board may still be involved as donors and volunteers in the organization, but they learn to separate their board role from their volunteer role. A challenge of a governance board often comes when the organization grows so large or national in scope that the board cannot adequately represent all stakeholder interests or is unable to manage the scope of the organization.

The Fundraising Board

When a nonprofit grows beyond the scope of local governance, the board often migrates to become a fundraising or institutional board. This type of board is quite large and generally includes people who have the capacity to give or are movers and shakers in the community. Board members are recruited for their financial means and play a major role in helping the organization meet its every-increasing financial needs. Institutional boards may still work under the direction of a smaller governance board or executive committee. In the absence of this smaller governing body, the responsibility for governance falls solely on the executive staff who may lack appropriate accountability to the stakeholders.

Space does not permit a review of other types of “broken” boards, but we’ll list a few you may recognize:

The Detached Board- detached from their responsibilities and just filling a seat

The Personalities Board- filled with people who want the prestige of board membership but contribute little

The Micro-Managing Board- a board caught in managing too many small details better left to the staff

The Rubber Stamp Board- a board that cannot mature beyond their obedience to the founder or a charismatic executive director

Kent Wilson (PhD) is a business practitioner and nonprofit leadership specialist. kent.wilson@vistage.com.