Balancing on a Leadership Tightrope
How Boards Can Step into Operations Without Losing Sight of Governance
In a well-functioning non-profit, the roles of the board and the executive director (ED) are clearly defined and respected. The board is accountable to members for the governance of the organization, while the ED is accountable to the board for operations. This separation provides effective oversight and clear lines of accountability.
However, situations arise when the board must step into an executive function and take on management tasks. This is not ideal, but it may be necessary in two common scenarios:
Temporarily, for an unexpected ED absence or departure.
Longer term, in small non-profits that cannot afford to hire an ED.
Both situations can blur the lines of accountability and create governance risks, but there are ways to minimize potential problems and maintain strong oversight.
1. Schedule Periodic Reviews of the Situation
When the board takes on management responsibilities, it should treat the arrangement as temporary — even if it isn’t. Regular reviews remind directors that while feasible, the situation is not ideal. They create a sense of urgency and keep the focus on finding a long-term solution.
If the board is filling in due to funding limitations, schedule an annual review to formally decide whether to continue operating without an ED.
If the absence is temporary, set a deadline for hiring a new ED, and reassess regularly if the situation extends beyond the initial timeline.
Without regular reviews, the board risks falling into a pattern of indefinite operational activity, which can compromise effective governance.
2. Define the Executive Role Separately
Even if the board is managing operations, the executive role should be clearly defined. Create a written description of executive duties and specify when one or more board members act in this capacity.
This clarity helps preserve the board’s oversight function by making it clear when directors step outside a governance role. Without this step, you can lose sight of the crucial separation between oversight and operations.
3. Maintain Independent Oversight
One of the biggest risks of a board acting in a management capacity is the loss of independence. To safeguard this essential function, form an oversight committee of directors who are not involved in day-to-day management tasks.
This oversight committee should:
Meet separately from the management group on a regular basis, just as it would for oversight of a management employee. By making it normal part of board meetings, this in camera session does not become a big deal.
Review operations from the high standards of a director’s fiduciary role—examine results and ask questions.
Address concerns and difficulties as they arise.
Remind directors who take on operational tasks that they still hold their fiduciary oversight role as well—they have not stepped away from the board and its inherent responsibilities.
Without this separation, there is more opportunity for mistakes or conflicts of interest to go unchecked until far too late.
4. Rotate Roles to Avoid Entrenched Groups
If the board must manage operations for an extended period, rotate directors through both management and oversight roles. This prevents two entrenched subgroups from forming and keeps fresh perspectives on board governance and operational tasks.
It also gives directors in the operational role a break from carrying a double-duty.
5. Check Your Bylaws and Legislation
Review your bylaws and any applicable legislation. Pay particular attention to:
Restrictions on the board chair or other director serving as ED.
Requirements for independent oversight.
Conflict of interest policies.
If necessary, seek legal advice.
6. Separate Meetings by Function
When the board is acting in both governance and management capacities, hold separate meetings for each function.
Keeping these discussions distinct reinforces the dual roles the board is playing and helps maintain accountability.
Why These Steps Matter
In my experience, most non-profit directors who take on an operational role do so with the best intentions. But, even without malicious intent, errors can creep in when layers of accountability are removed. Clear processes, regular reviews, and independent oversight are the best tools to protect the organization’s integrity during these challenging times.
By following these steps, boards can strike a balance between stepping in to keep the organization running and preserving their essential governance role.
Next week, in part 7 of the Step-by-Step Governance Review series, we’ll explore the framework, best practices, and documents that support an ideal board/ED relationship.
Having been on several boards through the years and having fallen into the operational mire, this is a good article to remind one of boundaries, good policy and functional procedures. These articles are very insightful and useful for anyone on, or interested in becoming a board member.