Recapping quickly and moving on —
My last blog posed a governing board of 3, who would be certified through a formal vetting process, and then become responsible for insuring that the public interest is being served by the incorporated arts organization. These duties would include fiduciary responsibility, management oversight and assessing the extent to which the stated mission of the organization is being accomplished. The question to address now is whether individual donors would be as inclined to give if they did not serve on governing boards, assuming for the sake of argument that they would not choose to enter the certification process.
Short of real research, I have asked a number of these individuals whom I know how they would react to such a new construction. Their answers group nicely in two domains. The first: “Whew! It would be a relief to be able to support “my” organizations without having to deal with those issues that dominate board and committee meetings.” And the second, ” I’m not so sure that I would trust the people on the 3-person governing board to manage my money. I want direct access to how it is utilized.”
Since this anecdotal “research” is consistent with literature concerning not-for-profit fund development, I feel comfortable addressing my collected “data.”
The “Whew” group should not be dismissed an unproblematic. Donors become donors because they experience a true closeness and deep involvement in an organization and with its mission. If there were a 3-person certified fiduciary board, then organizations would need to find additional creative ways to involve their individual donors. Perhaps what would be lost without attendance at board and board committee meetings would be regularity of exposure. Current volunteer programs at a number of large organizations could provide some initial ideas for maintaining regular and creative involvement.
The “I’m not so sure” group, the skeptics, could and would only be reassured if one of them, or ones close to them served on the 3-person board. And, also if over time, the 3-person model proved itself highly effective. My experience with those in this “I’m not so sure” group is that they are sharp and deeply committed to “their” organizations’ successes. I would strongly urge them to go through the certification process and serve on the fiduciary board.
A next step in moving forward with these ideas would be to develop the certification model, then vet it across the NFP arts sector. I’m familiar with the various excellent seminars and short courses for board members, but not with any certification programs. I’d be grateful to readers here if they know of anything along these lines from other professional sectors.
I’ve just read your two posts on Boards Reconceptualized. It seems to me that many boards unofficially run this way though the use of an executive committee and advisory committees. While the executive committee isn’t the only group legally responsible, in many organizations it is this smaller group that makes the majority of governance decisions. If people are still on the board in other capacities according to their expertise, then there would still be other committees that would give input to to the 3 member board. I guess, apart from only have 3 people legally responsible, I don’t fully understand how this structure is vastly different from current governance structures.
While I agree that a professional, certified board of 3 would relieve many of the difficult and frustrating elements of dealing with a board (spoken as a retired ED), I don’t think the idea is workable. For larger institutions, and not mentioned in your post, is the ‘prestige’ factor of board service, the social climbing aspect (one is often asked by prospects “who else is on the board?), the ability to regularly chat and mix with important artists. And of equal importance is the quid pro quo element of the give or get. I couldn’t imagine a gala or a capital campaign where a board member can’t say “I serve on so and so’s board” (rather than “I give them a lot of money”) knowing full well that they, in turn, will also be asked. Finally, there’s the inherent competition on a board – I once had a very canny board president, a woman of wealth, who played this angle with great success: she published a list at each board meeting actually listing what each member had given, and would often run what was in effect an auction using her own wealth as the goad! It worked like a charm. If one believes as I do, that 80% of a board’s efforts should be in fund raising, the 3 member model just doesn’t work. Very careful recruitment, clarity of what’s expected and internal board education is something that can keep the old-fashioned board structure alive. Unfortunately, I see no other alternative.
I, too, am familiar with this arrangement, and have served in both capacities in such, as a CEO and as a board leader. In my opinion, this arrangement does not remove the eventuality that unqualified board members will end up on the executive committee. I’ve suffered through too many unnecessary conflicts in these situations. I thank you very much for your good thoughts and comments.
Regarding certification, I think it’s a great idea, but if you have (e.g.) the biggest share holder for Proctor and Gamble on your board and supporting your organization are you going to tell him to get certified or else?
Input from other fields; I know at least two US States require that the members of the governing bodies of charter schools attend mandatory training in governance and legal context before they serve. I suspect that other states do as well, but my source for such things is out of the country.
Also in the charter school governance world, the ideal size for a governance board is probably five rather than three.
I am most concerned about what might happen to the resource development role of the board in your concept. Many organizations have a membership that may be legally analogous to stockholders in a for-profit corporation. Might it suffice to create a membership board that fulfills the social position of the board of directors, provides input to the vision of the organization, but doesn’t have to deal with the tedious chores of governance?
Thanks for these good comments. Which 2 states require the certification you describe?