4 Nonprofit Board Committees that all Well-Run Organizations Have

Regardless of the sector, maturity, or staff sophistication of the nonprofit organization, these four board committees are essential to the health of the organization and well-being of the board itself. Share this article with your board today and discuss how these four nonprofit board committees can help you do a better job providing oversight and support for your nonprofit. If your board lacks the expertise to support the activities outlined below, decide which board skills are needed, and start recruiting board members with these skills now.
Board Development Committee – This committee preserves the quality of your board’s future because it is responsible for determining what skills are required on the board, and for recruiting and orienting all new board members. While many boards have one-time orientation sessions, better boards continuously exposure their members to the work of the organization and the quality board governance they are trying to achieve. Along with the Board President, members of this committee communicate with your board members to ensure that they are making a productive contribution and they are satisfied with their board experience. The design, administration, and interpretation of your annual board self-evaluations is done by the Board Development Committee.

Finance Committee – The finance committee is often the most highly-functioning of all board committees. This committee supports the development of the annual expense budget, tracks the actual spending vs. budget, watches monthly cash flow, and interprets the overall financial health of the organization on behalf of the board. This committee supports the development of the longer-term strategic plan as well as next year’s annual plan. All of the financial policies of your organization should be reviewed by the finance committee prior to board approval. The Audit and Investment Subcommittees help round out the board’s involvement in the financial affairs of the organization.

Fundraising Committee – While the Executive Director is responsible for the organization’s fundraising, well-run organizations engage the support of the board in various part of their fundraising plan. This committee oversees the development of the Annual Fundraising Plan – and tracks the planned vs. actual results during the year. They encourage, train, and thank other board members for their involvement in the fundraising activities. They explore potential , new fundraising activities as part of the strategic planning process. Special Events Subcommittees can be established as part of this committee when appropriate.

Personnel Committee – Contrary to popular thinking, even small, young nonprofit organization need personnel (or human resource) expertise on their boards. Even if there is only one part-time employee working for your nonprofit, this committee helps make sure that all state and federal laws and regulations that affect employment are followed. This committee ensures that the wages you are paying are comparable to wages in other, similar organizations – and that each employee has a current job description, documented annual objectives, and yearly follow-up reviews that include training and career path planning. Employee Handbooks, Human Resource Policies, Staff Planning, Benefits Selection, Pension Considerations, and Vacation/Holiday Schedules for full-time and part-time employees are all within the responsibility of this committee.

Get the ball rolling by sharing this article with your fellow board members and your Executive Director.
If your board does not have a well-developed committee structure, start by assigning some board members to these committees now. If your board has committees but they’re not particularly effective, re-invigorate these four committees first. They are by far the most important to the effectiveness of your board and the success of your nonprofit.

Check out the booklets for each of these four committees at www.boardsthatexcel.com/the-market/

What’s the Board’s Role in Fundraising?

Posted on September 23, 2009 by  
Filed under Board/Staff Relationship · Tagged: ,

Studies show that many nonprofit boards and staffs are confused about their roles in fundraising.  Both think that the other needs to raise more money – and both are convinced that the other is the falling down on the job. 

Here is a summary of best practices that clarifies the fundraising roles for the board and the staff.

1. Name one staffperson (Executive Director or Development Director) who is responsible for ALL of the fundraising for the organization.

2. This fundraising staffperson is responsible for developing the Annual Fundraising Plan.  This plan is developed with the support of the board’s Fundraising Committee  – in cooperation with the staffperson in charge of the Annual Expense Budget and the board’s Finance Committee.

3. The Annual Fundraising Plan outlines a plan to raise 130% of the Annual Expense Budget.  (This is insurance so that even if one part of the fundraising plan doesn’t yield what you expect, you will still have raised enough money to execute your programs and projects. )

4. This Annual Fundraising Plan looks like an expense budget – but it details monthly cash income.  In the form of a chart, each month and the total are across the top and the Sources of Funds (Memberships, Sales, Individual Gifts, Major Gifts, Events, Corporate Sponsors, Grants, etc) are along the left side.  Estimate the amount of funds raised for each month for each Source of Funds – and total the amounts by Source of Funds and by month. Work on a cash flow basis – try to estimate when you will actually receive the cash – not when the pledge is made or the grant is awarded.  Don’t be discouraged if you can’t create an accurate Fundraising Plan the first year.  After a few years, you will become more accurate in your estimates.  

5. In the comments section of the Annual Fundraising Plan, include a summary of the responsibilities of the fundraising manager (ED or Development Mgr) for each of the Sources of Funds. 

6. Also, as part of the plan, state clearly the responsiblities of the Fundraising Committee, the Events Committee and those responsibilities you think need to be shared by all board members. This could include any or all of the following:  attending fundraisers, signing donor appeal letters, approaching corporate donors, planning or attending events, thanking donors (written, phone, or in person), etc.  For each event or activity, state clearly the fundraising goal and associated expense budget.

7. The development of the Annual Fundraising Plan must be done in conjunction with the Annual Expense Budget.  Both the staff and board committees must work together so that all plans are accurately represented in the numbers that are in these plans. 

8.  During the board meeting where next year’s Annual Expense Budget is reviewed and approved by the board, the staff and Fundraising Committee should present the Annual Fundraising Plan.  This, too, needs to be approved by the board. 

9.  Just as the Annual Expense Budget is reviewed by the board each month, the Annual Fundraising Plan (actual vs. plan) should be reviewed by the board.  Together the board and the staff  can make changes to the fundraising plans or adjust spending if necessary.

For more information that will help your organization improve its fundraising, sign up for the BoardsThatExcel.com eNewsletter today and receive the free article: “22 Ways to Engage Your Board in Better Fundraising.