When, Why and How You Should Be On The “Committee” Bandwagon
The last few months have been incredibly exciting…..and busy. Hence the missing blog post…..or two….or six. But I’ve definitely been busy working with organizations on a variety of different impactful issues. And something I’m incredibly excited about is the increase in the number of questions I’m getting about governance.
In fact, the impetus for this post is a conversation I recently had with an organization on its governance efforts. But it was what they didn’t say that got me thinking. Thinking about an aspect of governance I realized I don’t hear many organizations talk about; committee structures.
And when I do hear organizations talk about “committees” it’s almost a bit derisive. Dare I say…dismissive? Something along the lines of, “Yea, yea. We know. Committees are good. We’re working on that.”
Which leads to another interesting thing I’ve noted. On the list of “governance to-do’s”, somehow committees are always at the bottom. Often times dead last. But the irony is, most of the things organization’s try to implement from a governance perspective hinge heavily on whether or not its gotten committees right.
So I wanted this post to talk about why an organization might consider creating a committee structure, when and how it might go about it. Alot of these points might also be helpful for those that have committees and looking to revamp or refresh them.
So. Why are committees such a big deal? Well, committees…..
- …help board members police. Breaking down into smaller groups allows members to focus more on the details; in terms of implementation, execution and maintenance.
- …present opportunities for a reality check. It’s so easy for things to slip by or become pro quo when the group only has a few hours to meet and talk about everything going on. Committees allow members to dig deeper and not only see how things work but if they’re working.
- …are something more and more grant-makers are looking for. Many donors and grant-makers look for these to determine whether organizations are effectively governing and whether it might be susceptible to wrongdoing.
- …create engagement. Committees are one of the easiest ways to engage the board, get buy-in and cultivate involvement. They also help with creating community stakeholders outside the organization or establishing partnerships with other organizations (since committee membership can include non-board members).
- …increase expertise. Focusing in on something specific allows the expertise of board members to develop as well as their organizational knowledge. It also creates a great training ground for more effective board members and future board leaders.
There are a few misconceptions about committees floating around out there that should be cleared up. For example…..
- Myth #1: Decisions made by a committee don’t impact the Board overall. There are many States, like Texas, that don’t absolve the entire Board of liability just because a decision is made by a committee. Which means the entire board is still liable for those decisions; even where the committee has the ability to act on behalf of the board. But note, even where this isn’t the case the entire board still pays for actions taken by a committee. After all, donors don’t say “Can you believe what the Audit Committee of [insert nonprofit] did last week?” The integrity and respect of the entire organization is still at stake.
- Myth #2: Non-Board members can’t be liable for their decisions. Again there are many States that may not make non-board members liable for all actions taken by the board, but will hold them responsible as it relates to that committee.
- Myth #3: Organizations should have committees to look good on paper. A crappy committee is far worse than no committee at all. If the organization doesn’t have the resources, buy-in or willingness to develop and TEND to committees then it’s best to bring everything to the full board. Creating committees for committee sake is where organizations open themselves up for exposure to things like conflicts of interest, embezzlement or other illicit/illegal acts.
- Myth #4: All committees must be broad and perpetual. There are generally two types of committees; the standing and the ad hoc. I talk about these a little more on the blog. The gist, however, is that there is as much strategy to developing committees as there is to what the committees do. For example, if a committee is being created for something temporary like an annual campaign then there is no need to make it broad or infinite.
Best Practices (the How)
- Be thoughtful when forming a committee:
- First ask, is this really necessary? Do we have the resources to make it meaningful?
- Will the committee have the authority to act on behalf of the organization? Or will it just make recommendations?
- Will the committee be limited to directors? Or will we include non-directors? (Note: some States dictate how many non-directors are allowed on a committee under law. Look at your States code on nonprofit organizations to see)
- Non-directors need to be educated on their fiduciary duties under law and the expectations of the organization. Perhaps you could have them sign some type of commitment.
- Each Committee Chair should draft a committee charter setting out the committee’s purpose, reporting back to the board, number of meetings, meeting procedures, number for a quorum and duration.
- Each committee should keep minutes and report to the full board with a summary of the meeting(s) and a copy of the minutes.
- The composition of committees should depend largely on the role of the committee. If the committee is temporal and project specific then you might open it up to non-board members, or at the very least past board members.
- Take care that committees don’t become silos or cliques. Open up meetings from time to time, report back to the full board and require committee rotation. Failure to do so could result in stagnation or the development of possible conflicts.
- The Board Chair and Executive Director must review committees periodically to ensure they’re still necessary.
- As the organization’s committee structure evolves the Bylaws will need to be looked at and revised where necessary.
- Always ask, is the effectiveness of this committee being maximized? Does it work with its mirrored part of the organization (in otherwords does the Finance Committee work with the finance folks) and other applicable committees (Does the Finance Committee talk to others impacted by financial decisions such as Audit and Development)?
So that’s it. I think this is one of those topics that is pretty straight forward. I’d love to hear how other organizations are using committees? What have you found to work and not work?
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