Formulate policies regarding
development, review, and approval of mission, operating plans,
Approve mission and any
changes. Approve and authorize the annual operating plan and the
supporting operating and capital budgets.
Appraise performance and
appropriateness of any management corrective action taken. Ensure
compliance with board policies.
Define CEO's accountabilities
and how performance will be appraised.
Select CEO. Determine
compensation and annual increases.
Appraise CEO's performance.
Conduct of Operations
Formulate policies regarding
personnel, facilities, maintenance, safety, financial controls,
and other legal requirements.
Approve all policies
formulated by management that involve legal, regulatory, or
Appraise and audit operations
to ensure compliance with board operating policies.
Formulate policies regarding financial
controls, control and reporting of contributions and donations,
and financial auditing.
Select independent auditor,
review, and approve audit
report. Approve financial investments and financing
Monitor and appraise
revenues, expenditures, and cash position. Ensure
compliance with board financial policies.
Board Organization and
Formulate policies regarding board member
expectations, board member orientation, board development,
board committee assignments,
board planning and performance evaluation.
Approve by-laws and amendments.
Select board members. Elect
board officers. Approve board committee appointments, board
work-plan and annual board budget.
Develop a board information
system to provide the information needed to carry out the
board's oversight role. Appraise board performance.
THE ROLE OF COMMITTEES
and well functioning committees facilitate the work of the board. A
boards standing committees should reflect the board’s
responsibilities. Therefore boards should consider having only five
standing committees with one committee responsible for each of the
Committees have no
decision making power. They perform the staff work of the board and
bring recommendations for action to the board for approval.
Each committee should
fulfill the following roles in the committee’s area of
1. Draft, review, and amend
2. Analyze issues, develop alternatives, and
recommend board action
3. Appraise implementation
and effectiveness of board policies and evaluate organizational
ROLE OF THE PRESIDENT OR CHAIRMAN
the work of the board
as the spokesperson for the board
BOARD PLANNING AND SCHEDULING
Boards must plan and schedule their work to
effectively govern their organizations. Since the work of the board
is governance, boards must identify the work they must do to support
the operations of the corporation. The following process will help
boards develop their annual work plans.
1. Identify the work the board needs to
accomplish ( the board work matrix can be used as a guide for this)
Determine what key decisions the board will make
during the year and when they must be made. This decision
schedule sets the timing for board policy actions.
Assess whether existing policies provide adequate
guidance for these decisions. If not, determine where are they
deficient and what changes are needed.
Evaluate the effectiveness and usefulness of
existing policies. Determine what changes or additional policies
Assess the adequacy of the information used to
oversee board and corporate performance. Identify any new
Determine the actions the board should take to
ensure operations are conducted according to board policies.
These include performance reviews, audits, and inspections.
Determine the board’s educational and development
needs and how these will be fulfilled.
2. Assign work tasks to committees
Committees schedule their work to meet the board
Committees develop the detailed work plans and
schedules needed to carry out the board’s work.
Committees present their work to the board for
3. Schedule the work of the board and prepare
A board work plan and schedule are needed to assure
the board’s work is accomplished.
The board’s work plan and schedule are used to
prepare the board’s and committee meeting agendas.
The board’s work plan and schedule provide a
baseline for the board to measure and evaluate its performance.
THE CHIEF EXECUTIVE
The work of the chief
executive is to manage the corporation. It is distinct and separate
from the work of governance. Typical chief executive
responsibilities and roles are presented here to illustrate this
define what the chief executive must do. The following are typical
CEO responsibilities but not necessarily the only ones
- Organizational development
- Setting performance standards
- Effective and efficient use of
- Providing administrative support
for the board
Roles define how the
chief executive carries out the responsibilities assigned. The
following are typical CEO roles but not necessarily the only ones.
- Planner/ strategist
- Administrator/ supervisor
The Work of the Chief Executive
Combining the chief
executive’s responsibilities and roles produces a matrix which
defines the work of the chief executive. This matrix or a similar
one can be used as a tool to define the position description and
accountabilities of the chief executive.
Achieving the Mission
Define organizational goals,
formulate strategy, set objectives.
Plan and assign work. Delegate
accountability for accomplishment.
Communicate results to board,
community, and workforce.
Determine skills and
competencies needed for mission accomplishment. Develop organizational structure.
Hire, train, and coach
workforce. Develop the competencies needed to accomplish
Provide performance feedback
Setting Performance Standards
Establish the performance
standards needed to ensure mission accomplishment.
Measure and evaluate
performance. Analyze variances and take corrective action when
Communicate and explain
performance standards to workforce.
Effective and Efficient Use
Develop work processes and
controls that will provide efficient operations and prevent
unauthorized use of resources.
Authorize work and supervise operations. Monitor and evaluate financial expenditures.
Analyze variances and take corrective action when necessary.
performance to appropriate parties.
Administrative Support for
Assist board organize and
plan its work.
Provide staff assistance to
Provide the board with the
information it requests to carry out its oversight role.
description of the work of the board and the work of the CEO
demonstrates how each entity contributes to the performance of the
corporation. High performance organizations exhibit strong teamwork
between the board and corporate management. Good board governance
empowers effective management action.
John Carver on Board
Carver is a recognized authority on board governance and has written
many books and articles on this subject.
This is a synopsis of his ideas.
board does not exist to help manage the organization but to
represent some larger ownership. It must therefore be clear to a
board exactly who the owners (legal or moral) of the organization
are. The board should primarily identify with the owners, not the
managers or professional staff.
The board has authority to direct the organization only
when acting as a group. No individual trustee has any authority
over the organization. To function effectively, the board must
speak with one voice.
The board functions best by focusing on underlying value
rather than by making discrete, operational decisions.
Boards should develop policies based on values, and then
delegate to management the responsibility to perform under the
The most important board work is centered around the
“why” of the organization; developing policies that define the
organization’s ends or outcomes, not its activities. The
services and activities of the organization must be seen as means
to an end, not as the end themselves.
The board clearly defines the job of the Chief Executive
Officer, as well as the authority delegated to the CEO by the
The board monitors organization performance, and conducts
ongoing evaluation of CEO performance, based on attainment of
stated ends or outcomes and compliance with board policies. Too
often, boards pretend to govern, while their managers pretend to
work for them. To help overcome this, once the board has selected
a CEO to run the organization, it should let him or her run
it—within the scope of the board policies.
The board explicitly states principles and rules for its
own operation. Such rules and principles include: a board job
description, along with a job description for the board and
committee chairs; board committee structure and principles; style
of governance decision-making; and, control of agenda materials
and information flow, among others.
The board focuses on its own job more than on those of
subordinates, using rigorous self-evaluation to stay on the proper
meetings are for creating the future, not for hearing reports
about what happened last month, nor for rubberstamping
decisions that should be the domain of management.
JOHN CARVER’S PRINCIPLES OF GOVERNANCE
act in trust for those who morally own the organization.
board speaks with one voice or not at all.
decisions should be predominantly policy decisions.
should write policy by determining the broadest values before
progressing to more narrow ones.
board should define and delegate rather than react and ratify.
determination is the pivotal duty of governance. Ends answer the questions:
What results do we want to achieve?
For whom do we want these results to benefit?
At what cost can these results be achieved?
A boards best control over staff means is to limit not
A board must explicitly design its own processes and
A board must forge a linkage with management that is both
empowering and safe. The
board instructs no staff but the chief executive
Performance of the chief executive must be monitored
rigorously but only against criteria set by policy.
for board governance assistance and coaching. TheCoach@ThreeSigma.com