Types of Non-Profit Boards – Options for Governance Models
Although the literature in this area is extensive, in essence there are three different types of boards or models of governance. They are:
1. An Operational (or Administrative) Board
2. A Policy-Governance (or Carver) Board
3. A Policy Board
Operational boards are useful when:
- The organization is grassroots and has few or no employees.
- The organization is experiencing a major crisis and the board must step in to manage the organization until it is stabilized.
- The organization is newly formed and not yet ready or able to hire people to operate services or programs.
The increasing sophistication of non-profit organizations has made operational boards less common. As a result (and unfortunately) very little information exists on how to be an effective board of this type. It is often assumed that an operational board will be transitional – meaning it will become a policy board once the foundation work of the new organization is complete. In fact, many smaller non-profits choose to have operational boards for many years. The board and a core group of service volunteers do all the work with little or no need for paid employees. An excellent web radio link (not associated with the author of this ezine article) for grassroots non-profits is provided in the resource section below.
Policy-Governance or Carver boards are often used by larger organizations that provide high-level professionally delivered services and programs. This type of board:
- Is the least involved in operations of the three types of boards.
- Focuses on creating end statements (the results or outcomes to be achieved), rather than on means or how or what will be done to achieve the outcomes.
- Focuses exclusively on creating and monitoring policies that require and limit the executive director to do or not do certain things. Given these limits, the executive director and staff may manage the organization as they deem appropriate and necessary.
This model is intended to simplify the board-staff roles and relationships. In practice, most boards and senior managers find the model complex to implement in the early stages. The “Carver Model” is very well regarded by some organizations that use it, while others have modified the strict expectations of the model and found this works better for them. Still others have attempted a policy governance approach and abandoned it. Anecdotally, if this model is to be effective, it would appear that a certain sophistication and perseverance is necessary-both by the board and by the senior manager.
A policy board is the most common model of governance among non-profits today. A policy board:
- Delegates (in writing) responsibility for day-to-day managing and operating of the organization.
- Creates, reviews and then approves governance policies (how will the board conduct its own work and business of the board) and framework policies such as vision, mission, purpose and core values).
- Defines how the executive director will be held accountable for use of financial resources, program/service outcomes, and human resource practices.
- Supports the executive director and appraises his/her performance annually.
- Ensures the organization has the financial resources necessary to fulfill its mission and mandate.
It is important for your board to declare itself (via a board motion) to be one of the three types of boards. The activities of the board, directors’ job descriptions and relationships with the executive director all hinge on the governance model the board chooses.