Power Breakfast: Nonprofit Board Responsibilities

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What’s it like to serve on the board of a nonprofit? What challenges do directors of nonprofits face? Are they the same as what directors of for-profit companies deal with? The panel discussed what questions the board should ask management about emerging trends and potentially disruptive forces that could threaten the organization’s mission and strategy.

Many good governance principles of the for-profit sector hold true for the nonprofit sector. The panel discussed the challenges nonprofit directors are facing in today’s world, including the role outside directors should play in engaging and communicating with stakeholders, the skills and qualifications nonprofit boards want in new directors, and how the board can set appropriate performance targets. Changing demographics, economic conditions, and technology that drive big changes for companies and their business models were also highlighted.

1. Who are the right people for the board? One problem is that some business people leave their business acumen at the door; others bring personal agendas to the boardroom.

2. Boards need to be realistic about the cost of running the nonprofit business. You can’t run the business on the cheap, and investment in the business and its people will help achieve the mission.

3. Disruptors and transformational forces can include substantial donors and their personal expectations and technology transformation. There is severe competition for donor money, and figuring out relevant rewards to donors can provide incentives. Other nonprofits are rarely called “competitors” because they are often not head-to-head competitive operations.

Robyn Bew
Research Director, National Association of Corporate Directors

Helene D. Gayle
President and Chief Executive Officer, CARE USA; Director, The Coca-Cola Co., Colgate-Palmolive Co.

Raymond V. Gilmartin
Former Chairman, President & CEO, Merck & Co. Inc.; Director, General Mills, National Association of Corporate Directors

Lynn Thompson Hoffman
Director and Chair, Governance and Compensation Committee, Boston Private Financial Holdings 

This summary provided by PricewaterhouseCoopers.

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