Keep the Details
in Their Place
By J. Patrick Traynor
Three Quick Takeaways
- Average- and low-performing boards spend the lion’s share of their time on administrative issues, often because these are the things least likely to challenge and cause tension among board members.
- High Impact Boards ensure the organization maintains a central repository of important documents and an annual calendar of essential activities with deadlines and owners.
- An effective system will ensure that key activities get done on time and make locating the organization’s essential documents much easier. It will also serve as a reliable anchor in the event that there’s turnover among key organizational leaders.
Most boards are aware of their fiduciary duties:
- Duty of Obedience: The responsibility to remain true to the organization’s mission while ensuring compliance with all federal, state, and local laws
- Duty of Loyalty: The obligation to cast aside any personal or professional interests and put the needs of the organization first
- Duty of Care: The burden to ensure an information-gathering and -reporting system exists and that it adequately flags the CEO and board members in a timely manner
These important but largely administrative matters consume about 80 percent of the time of low- to average-performing nonprofits. High Impact Boards, on the other hand, spend about 20 percent of their time on them.
As we proceed, it’s essential that you do not misunderstand our intentions. The step of taking care of the organization by delivering on the details is vitally important and cannot be overlooked. But the reality is that it needs to be kept in its place, or it will easily consume too much of the board’s valuable time.
Here’s a simple, three-step system that will help you do that:
Govern It
High Impact Boards have a task force or committee in place that ensures the dotting of i’s and crossing of t’s.
The first step is to assemble a group of willing and qualified directors to oversee a well-thought-out, systematic approach to taking care of important organizational details. This group will be officially charged with ensuring staff compile a master annual organizational checklist of important activities, documents, and deadlines — along with an accompanying implementation calendar. We recommend at least an annual committee review and periodic board reporting on this system.
The master list and calendar will vary depending on the size and mission of your organization. We have provided an abbreviated template below (see Figure 1.6). Some examples could include: annual staff evaluations; local, state, and federal license and fee requirements; and annual conflict-of-interest statements completed by board and staff.
Leadership is responsible for executing and reporting on progress made on the completion of duties identified in the annual calendar.
The committee should also ensure that staff gather all important documents, forms, and policies in one easily accessible location. Each organization will be slightly different.
Instructions: Below is an example of the types of items to include in a master organizational checklist. It’s not comprehensive, but it should give you a good idea of what your organization should be tracking as you build your own
Guide It
Once all the information has been organized and archived, it’s essential that the appointed committee guide the process by establishing a formal annual timeline to review and approve, as necessary.
Ideally, your nonprofit’s committee will work in harmony with the board chair and executive director to develop a schedule that fits into the annual rhythm of the nonprofit.
This schedule is essential because some of these documents will need to be reviewed and submitted to comply with formally established deadlines — IRS forms 990 and 5500, the annual plan and budget, and license and certifications.
Other documents — income statements and balance sheets — will need to be reviewed and approved monthly or quarterly. Still others may only need to be reviewed every 12-24 months such as personnel and record-retention policies.
Guarantee It
With the annual review schedule of all essential documents and activities established, the final step for this committee is to guarantee that the process lives on even after its members have cycled off the committee. This means working with the nonprofit’s CEO and key staff members to establish an internal policy and system where all of this important information can be effectively managed, maintained, and periodically reported to the board.
An effective system will ensure key activities get done on time and make locating the organization’s essential documents much easier. It will also serve as a reliable anchor in the event that there’s turnover among key organizational leaders.