How to Build a Governance Framework that Reflects Your Board’s Culture
A Step-by-Step Governance Review, Part 1
A non-profit board’s governance documents guide how it functions, makes decisions, and ensures accountability. However, these documents alone are not enough. They must align with the board’s culture, drive the board’s activities, and reflect the board’s approach to its governance responsibilities.
This article is the first in a series that will explain how to do a full governance review, which results in a set of documents that support your board’s needs.
Board Documents: More Than Just Paperwork
This series will be about far more than just writing a board manual. A well-crafted set of governance documents will only be effective if it is supported by a board culture that implements them with integrity.
For example, when we discuss committees, we’ll cover determining which committees your board needs first. Then look at structuring, functioning, and interactions with the board, volunteers, and staff, before looking at drafting mandates and other documents affecting committees.
The process of developing or reviewing governance documents starts with addressing the board’s governance culture and how directors take part in governance activities. These documents are more than just formalities; they define how the board functions and serves the organization, while also allowing for flexibility in response to changing circumstances. In this series, we’ll take you through all the steps that lead to effective documents, and not just headings and language for those documents.
Why Are Governance Documents So Important?
Governance documents, known as a “Board Manual,” outline the board’s duties, responsibilities, processes, and policies. They also mirror the board’s culture and practices. They are essential because they:
1. Provide Consistency
Directors and board leaders come and go, but the organization and its mission continue. Governance documents ensure a consistent approach to board responsibilities, providing stability for staff, volunteers, and members.
2. Get New Directors Get Up to Speed
New directors hold important responsibility as soon as they join the board. Developing relationships and understanding board culture may take some time, but a well-written board manual can provide a clear foundation for orienting new members to their duties, responsibilities, and board functions.
3. Demonstrate Professional Approach to Governance
Well-developed governance documents show that the board takes its responsibilities seriously. They communicate to members, staff, volunteers, funders/donors, and other stakeholders that the board has a commitment to operating with transparency and accountability, and fully understands its responsibilities.
Starting the Process: How to Approach a Governance Review Project
A thorough governance review project can seem daunting, but breaking it down into manageable steps will make it achievable. Here are some issues to consider when you are first contemplating this project:
1. Clarify the Purpose & Gain Support
The board chair’s support for the project is essential. This will help signal its importance to the directors and management. This support should include clarity on:
Why the board is doing a governance review.
The parameters of the project.
Who will be involved and how: full board, committees, executive director and any others. You won’t have committee members named yet, but the board chair will need to understand how the project will roll out.
2. Committee Role
A small group of 2-3 directors should lead the project work. The board chair doesn’t need to serve on the committee, but will need to liaise with them regularly to provide adequate time during board meetings for updates, discussion, and feedback.
The committee should include a mix of experience levels:
at least one director with longer tenure and experience in the board’s practices and culture, and
at least one newer director, who brings fresh eyes and questions to the project, and to provide continuity over the length of the project.
The following qualities will be valuable on the committee:
Analytical skills, to review existing documents and later to review final documents for internal consistency and completeness.
Written communication skills, to capture the board’s responsibilities, processes, and policies in understandable and clear terms.
Open-minded and curious, because this project is not just about documenting “how the board does things.” The committee will first asking, “what is the best way for the board to approach its work, in this environment, at this time?”
3. Engage the Executive Director
The Executive Director’s role includes locating existing documents, providing insights on governance practices’ impact on day-to-day operations, and granting access to other staff members who support the board’s work. Staff, volunteer and contractor input can be invaluable in aligning the governance documents with the organization’s needs.
4. Resources
Besides board and staff time, the board must determine whether to put any further resources towards the project, such as:
To accelerate the project, a governance consultant can offer extensive support. This includes reviewing current documents and practices, suggesting next steps, providing feedback on final documents, and addressing committee inquiries.
An accountant can provide feedback on how the board describes its financial and risk oversight responsibilities in the board mandate, audit committee mandate, and any other documents.
A lawyer can provide feedback on the full board manual and its alignment with the board’s duties and responsibilities under applicable legislation and regulations.
Whether you rely on any expert advice will depend upon the level of knowledge and experience among directors, and availability of resources.
Project Timing
The time to complete a governance review varies, as several factors influence it, including:
The number and quality of existing documents.
How well-integrated these documents are with board practices.
The time the board can dedicate to the project.
Unplanned interruptions because of committee member availability, change in board leadership and external factors affecting the board’s agenda and workload.
Some boards may complete the process in a few months, while others may take a year or more. The key is to approach the project steadily and with care. Rushing can cause inconsistencies or gaps, which could lead to problems down the road.
Interim Goals
This series of articles will outline a process that begins with documenting foundational responsibilities and then progresses in a logical order. As each step builds upon the previous one, this process will provide interim goals and allow the board to work from each phase of the project as it completes it.
Investment in the Future
The initial governance review requires a significant investment of time, both from the committee and the full board. However, once it is complete, maintaining governance documents becomes much easier. A focused review every three to four years is usually enough to keep the documents up to date and ensure they still align with the board’s current practices and culture. This prevents the need for a complete overhaul down the line and keeps governance practices in step with the organization’s growth or changes in your operating environment.
Drawing from Sample Documents Isn’t Enough
It can be tempting to use examples of board manual documents from other non-profits as a shortcut. However, governance documents need to be tailored to your board’s unique culture, needs, and stage of development.
Every non-profit operates differently, even within the same sector. Sample documents can serve as a helpful guide, but they won’t capture the nuances of your board’s needs. A full governance review will ensure that your board’s governance approach is appropriate and aligned with the organization’s mission.
Moving Forward
A governance review is an investment in your organization’s long-term success. By working steadily, starting with foundational documents, and aligning the process with board culture, you will create a governance framework that can grow with the organization and provide lasting value.
In the next article in this series, we will cover your first steps once you have decided to launch a governance review project.
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