Monitoring Compliance with Board Policy

Over the past years there has evolved a greater understanding by Boards of the importance and value of policy. It appears as if Boards have spent considerable time establishing policy. But too often, they fail miserably when it comes to the other part of that task: monitoring compliance with that policy.

It takes a lot of work to establish the rules (policy). But what I’m witnessing more often than not are those rules being placed on a shelf to gather dust (much like strategic plans used to do). What good are rules if you don’t monitor compliance with them? Is a Board truly discharging its responsibility for effective management of the organization by simply trusting that the Chief Staff Officer (CEO, Executive Director) is complying with that policy? Frankly, I don’t think so!

Every policy that compels the Chief Staff Officer to do (or not to do) something needs to be monitored. Each policy should be discussed by the Board to determine what information they need to satisfy themselves that the policy is indeed being complied with, and how frequently they require that assurance.

And I also suggest that when the compliance information is advanced to the Board, that the Board also discuss and consider whether the policy needs to be amended based on changing needs or circumstances. This ensures that policy will always be “top of mind”, and certainly provides great information and orientation to new members of the Board. Both are important.

How often are your policies on your agenda?

An all too frequent scenario: a Board invests significant time and effort to establish a wide range of governance policies, covering issues related to the role of the Board and the role of the Chief Staff Officer, and setting out limitations on the authority of the Chief Staff Officer. The policies then get plunked into a Board manual, and are handed out to existing and new Board members. Thus far, good stuff!

But what happens all too often after that is: nothing! The policies are rarely if ever discussed, and the Board, as a consequence, goes bad to old habits.

What a shame. All that work and effort for what?

Here's what needs to happen. If the organization has, let's say, thirty (30) policies in place and meets six (6) times each year, five (5) of those policies should be on each Board agenda. What to discuss? With each policy, the Board should ask itself these questions:

• Does the policy still satisfy our needs?


• With regard to policies that place limitations on the authority of the Chief Staff Officer, are we receiving adequate information that allows us to satisfy ourselves that the policy is indeed being complied with?


• Is the policy clear to everyone to whom it applies (all Board members and the Chief Staff Officer)?

Policy discussion at each Board meeting reinforces that the Board governs through its policy-making function - this is a critical step in the orientation of new Board members. They must be given adequate opportunity to learn how a Board governs, and they must be afforded opportunity to question the intent and or appropriateness of every policy that exists.

I also find it odd that Board Chairs rarely re-focus the Board back to discussion about policies. When Board members wade into operational discussion (and this, as we all know, happens frequently) the Chair needs to bring discussion back to existing Board policy. The Chair needs to ask the Board member(s) what their real concerns are, and bring them back to discussing the Board policy that governs that particular issue. The question to the Board member needs to be, "What amendment would you propose to the existing policy to satisfy your concern, or what new policy needs to be established"?

Governing in this manner way can eliminate Board discussion on the same or a similar matter year after year - establish policy that governs those circumstances, and you won't have to have the same discussion again. Then you can focus most of your time on your other important task: focusing on the future.

Removing Board Members for Cause

Bill C-4, Canada Not-for-Profit Corporations Act, if passed into law, contains a provision regarding removal of Directors. The provision gives members the right to remove a Director from office before the end of his/her term of office by way of a resolution voted on at a Special Meeting. The Bill also provides that if any class or group of members has an exclusive right to elect a Director, only a resolution by that same class or group has the power to remove that Director from office. In other words, if a particular Chapter/Zone/Branch has the authority to elect a Director, only a resolution by that group can remove that Director.

In principal I agree with the provision. But here is a scenario I often come across. A Chapter elects a Director to serve on the Board - that Director, however, does not arrive at meetings prepared, does not actively participate in discussion and debate at meetings, does not respond to requests for input between meetings, and does not follow through on things s/he has committed to do for the organization.

The Board as a whole conducts evaluations of each other on an annual basis - the results of the evaluations are compiled and are provided to the individual Directors as well as the Chair of the Board. The Chair meets and discusses the evaluations with each individual Director, encouraging those with less than positive evaluations to take a greater interest in the organization and their job as a Director. But since the Chair and the Board itself doesn't nominate members for the Board, they see themselves as being "stuck" with the ineffective Board member, who often times is reelected to the Board by their Chapter constituents.

This does nothing to serve the organization as a whole, or the Chapter - neither is being well served in this scenario.

Here's a thought. If an organization is actually taking the time to evaluate the performance of each individual Board member, why not, in the interest of transparency and accountability, establish a Board policy that requires the publication of the resulting annual evaluations for all members to see? Wouldn't that ensure that members of the groups or classes who elect representatives to the Board at least have access to the thoughts of all other Board members (who are the only real witnesses to ongoing performance) on that particular member?

It seems absurd to put time and effort into evaluation of Board member performance (which I believe is critical) but not have the results of that effort influence the selection of future Board members. Thoughts?

Tough Time Finding Board Members?

A recent comment from Kim in an earlier post rasies the issue of the difficulty some not-for-profit organizations have finding people to serve on the Board. Coincidentally, I am currently working with an association Board who cites that same problem. But here is what I found:

• the Board spends no time on Board renewal - in other words, no work is done in the field to promote Board service and the benefits that accrue to those who volunteer (i.e. developing governance and leadership skills).
• the Board has not examined the way they conduct their business to see if changes could be made to make the time commitment and workload required of Board members more managable (i.e. by establishing Board committees, or using technology to communicate and make decisions through, for example, teleconferencing).
• the Board has no strategic plan (although that is now in process) that contains a compelling vision that inspires members and increases their interest in contributing to the future of their association.

To those association Boards who find themselves in a constant battle to find "warm bodies" to serve as Board members, I say this: spend time at your next Board meeting asking yourselves why this is so. The status quo is not your only option. The amount of success a Board has finding competent and committed Board members is often tied to the amount of time the Board spends on Board successsion planning.

Every Board should establish a policy that compels the Board Chair to conduct an exit interview with every parting Board member to find out why they no longer wish to serve and how their experience as a Board member could have been improved. The results of those interviews should be shared with the entire Board - they will fuel this very important discussion on an ongoing basis.

Dealing with Difficult Board Members

It happens. Every once in a while there will be one Board member who is a thorn in everyone's side. It may be that they don't participate in discussion and debate and after leaving the meeting tell everyone they disagree with the Board's actions. Perhaps they continually come to meetings unprepared - I can't tell you how often I've seen Board members arrive at the meeting and pull out and then open the envelope that was mailed to them two weeks beforehand. Or how about those Board members who say they are going to do something but never do? Or, those who repeatedly fail to respond to requests for input into important issues?

Here's the thing. The Board doesn't have to accept such behaviour. In fact, it shouldn't. To simply ignore bad behaviour sends a message to everyone else that such behaviour is condoned. It suggests that the work isn't important or doesn't matter. Those are awful messages to send.

What do you expect of members of your Board? I suspect, at minimum, you want them to:

• come prepared;
• contribute to discussion and debate;
• listen and consider the views of others;
• honour commitments they make to the Board;
• respect confidentiality when it is required;
• support Board decisions; and
• actually attend meetings.

By no means is the above list a comprehensive one, but it is a good starting point for full Board discussion that leads to the establishment of a documented policy on Board member performance expectations or code of conduct.

Once you have listed your expectations, take your policy one step further. Document what will happen when and if a Board member breaches the policy. If this step is not documented in the policy, it becomes more likely that breaches will continue to be ignored. A documented policy that says, for example, that the Board Chair shall have a discussion with a Board member who breaches the policy, increases the likelihood that such a discussion will actually take place. Taking it further, by then compelling the Board Chair to provide a report to the Nominating Committee on the nature of that discussion, will increase the likelihood that the offender's name will not be on the list of proposed nominees for the Board the following year.

I acknowledge that it is indeed difficult to discuss performance issues with someone. Without a policy to guide what happens in such cases, nothing will likely take place. That's not serving the Board, or the not-for-profit organization. Doing nothing is simply not an option.

Have Executive Committees Run Amok?

Practically every set of not-for-profit or association bylaws contains a provision that establishes an Executive Committee of the Board. They are often comprised of the current Board Chair, the past Chair, the Vice Chair and the Board's Secretary-Treasurer. Too often, the bylaws don't go any further than this - they simply state there shall be an Executive Committee, but don't say what role or responsibilities will fall to it.

And the Executive Committee, with nothing to guide it, decides on its own what role it will play. It often meets before the full Board, and reviews and discusses the entire Board agenda. When the Board meeting takes place, the Chair will often precede discussion on a certain agenda item with, "The Executive Committee discussed this in detail yesterday, and we recommend.........".

What this does is three things. First, it makes Board members feel like second-class citizens - many are likely questioning why they are on the Board if the Executive Committee is doing all of the work and essentially driving all decisions. Secondly, members of the Board often take the easy way out, rather than deal with issues and make decisions that truly fall to them, by deferring a matter to the Executive Committee. And finally, members of the Executive Committee are essentially holding the same meeting twice - once on their own, and once with the full Board. Is this an effective use of their time, and that of the Chief Staff Officer who likely also attends both meetings? I don't think so.

If the bylaws fail to address the role of the Executive Committee, the full Board should discuss this issue with a view to establishing documented terms of reference.

I wonder sometimes if Executive Committees, because they are referred to in the bylaws, have, with the best of intentions, determined on their own what their job should be. For me, the key driver should be ensuring that they don't do work that rightfully belongs with the full Board of Directors - after all, the full Board is responsible for the effective management of the organization, not the Executive Committee. And, the full Board needs to truly "own" the policies and priorities it establishes - full discussion and debate will do a long way toward that worthy objective.

Sandi L. Humphrey, CAE

The Micro-Management Syndrome

If you asked association Chief Staff Officers (Executive Directors, General Managers, CEOs) what one thing a Board does that drives them bonkers, I guarantee a huge majority would respond with "micro-management".

But over the years, as I have pressed further when this assertion arises, I often find that the Chief Staff Officer is actually inviting Board interference into operational matters by virtue of the type of information they include on the Board agenda.

The Board agenda should be chock full of information it needs to govern, not information the staff needs to manage. There is a distinct difference between the two.

If a Board is truly governing, it has policies in place to guide the Chief Staff Officer in day-to-day operations. It also has in place a comprehensive strategic plan that guides operational priorities for organizational outcomes. With these two critical pieces in place, Board agendas should include reports from the Chief Staff Officer that do two things: provides evidence of compliance with with Board policies, and, updates the Board on the status of the goals and priorities outlined in the strategic plan. These two types of reports and discussion should be at the top of every Board agenda.

Where I often see a void, however, is a Board not making it clear to the Chief Staff Officer what types of information it expects to be provided with on an ongoing basis. A "Board Information Needs" policy makes huge sense - after all, if you haven't made your needs clear, how can you hold someone accountable for filling those needs?

A Board Information Policy should compel the Chief Staff Officer to provide the Board, at minimum, with:

• an update on the status of the goals and strategies in the strategic plan
• reports on compliance with Board policies (based on a frequency determined by the Board for each individual policy)
• information on internal or external trends that may impact the organization and perhaps compel the Board to revise or re-prioritize their goals and strategies
• member or stakeholder issues or concerns
• information and articles on governance that might help the Board improve their performance

Boards should ask themselves what type of information they need to do their job, how frequently they need it, and in what form. Responding to these important questions in the form of a Board policy on information needs is one of many steps that not-for-profits can take to reduce micro-management and help the Board assume its governance responsibility.

Sandi L. Humphrey, CAE