Effective Approach to LMD

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JOURNAL forNONPROFIT MANAGEMENT

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Articles

Developing Leadership on Boardsof Directors

The Board Chair-ExecutiveDirector Relationship:Dynamics That Create Valuefor Non-Pro t Organizations

Fostering Effective Relationshipsamong Nonpro t Boards andExecutive Directors

So Many Leadership Programs,So Little Change:Why Many Leadership DevelopmentEfforts Fall Short

Coaching Strengthens Nonpro tLeaders and Their Organizations

Effective Approaches toLeadership Development

Sponsored by


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SPONSORED BY

PUBLISHED BY

305 Seventh Avenue @ 27th Street; 11 th oor

New York, NY 10001-6008

phone: 212-924-6744

www.supportcenteronline.org

REVIEW COMMITTEE

Anne GardonPrinciple Strategies for Change

Anne E. GreenPartner Griffen Green Associates

Catherine MarshThe Westchester Community Foundation

Dwight V. DennisonAssociate Professor of Public and Nonprot FinanceThe Martin School of Public Policy and Administration,University of Kentucky

EDITOR

John D. Vogelsang

Copyright ©2008 by the Support Center for Nonprot Management. All the authors retain the rights to their articles. No part ofthis publication may be reproduced or transmitted in any form or by any means, electronic or mechanical without permission fromthe individual author.

The Journal solicits and accepts articles in the following categories: applied research, evidence based and innovative practices,case studies, and book reviews. Articles should be no more than 4,500 words, use inclusive language, and comply with stylerecommendations outlined in the Publication Manual of the American Psychological Association . Permission to use quoted materialis the legal responsibility of the author. Authors are also responsible for the correct documentation of all references used to supporttheir manuscript. Authors should submit their manuscript by e-mail to the editor. The Journal does not pay for the use of articles.Authors retain the rights to their articles. For further information contact the editor: John Vogelsang, (212) 924-6744, ext. 308;e-mail: [email protected].

JOURNAL for NONPROFIT MANAGEMENT An annual publication for those concerned with developing excellence in nonprofit management

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CONTENTS

From the Editor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Developing Leadership on Boards of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2Barbara S. Miller and Jeanne Bergman

The Board Chair-Executive Director Relationship: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Dynamics That Create Value for Non-Profit Organizations Mary Hiland

Fostering Effective Relationships among Nonprofit Boards . . . . . . . . . . . . . . . . . . . . . . 23 and Executive Directors

Jodie Butler Markey and Dwight V. Denison

So Many Leadership Programs, So Little Change: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Why Many Leadership Development Efforts Fall Short

Mary Genis

Coaching Strengthens Nonprofit Leaders and Their Organizations . . . . . . . . . . . . . . . 41 Carolyn J. Curran

Effective Approaches toLeadership Development

JOURNAL for NONPROFIT MANAGEMENT An annual publication for those concerned with developing excellence in nonprofit management

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JOURNAL for NONPROFIT MANAGEMENT 2008

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From the Editor

Welcome to the 12th edition of the Journal for Nonprot Management. The theme for this year’s Journal is Effective Approaches to Leadership Development . Three of the articles offer com-plimentary perspectives on board development and the relation between the executive directorand board chair. The nal two present an assessment of what needs to change about currentleadership development offerings and an overview of the benets and process of coaching forexecutive directors.

Summarizing the results of a Governance Matters study of fteen exemplary nonprots,Barbara S. Miller and Jeanne Bergman provide important insights into how boards create aculture of leadership and transform themselves into an active, engaged, and knowledgeableteam – one that can guide a nonprot organization to anticipate and respond to the myriad

challenges in the sector today.Mary Hiland shows how nurturing the relationship and establishing and sustaining trustbetween the board chair and the executive director is strategic work essential to organizationaleffectiveness. The importance of connection, caring and meaning should not be lost in anover-emphasis on more business-like practices and claims of harried busyness. The potential toleverage the board chair-executive director relationship and increase nonprot organizations’stock of meaningful, productive relationships is great and unrealized.

In a study of nonprots in Kentucky, Jodie Butler Markey and Dwight V. Denison identify keyfactors that contribute to the board chair and executive director relationship. Those factorsinclude the length of time that the executive director has worked for an organization and thenumber of hours per week that the executive director communicates with board members.

Too many seminars billed as executive leadership are real ly basic skill building endeavors thatdo not develop leadership potential. Mary Genis suggests how to shift the focus to leadershipcapacity building and utilize the best practices of adult education.

Carolyn J. Curran answers some key questions about coaching such as: why is there a discrep-ancy between interest in, and practice of, coaching; what is the dif ference between coachingand consulting; when is a nonprot leader ready for coaching; what happens in a coachingsession; how can coaching top executives impact a whole organization; and how to payfor coaching.

We invite your comments about the current articles and your own articles for inclusion infuture editions. Details about submission are on the inside title page of the Journal .

John D. VogelsangEditor


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Barbara S. Miller 1 , independent consultant and founding member of Governance Matters Board, and Jeanne Bergman , independent consultant and co-chairGovernance Matters Board Leadership Project

M uch has been written about governanceon nonprot boards, but there is little thataddresses the development of leadership:how individuals who are volunteering their timetransform themselves into an active, engaged, andknowledgeable team – one that can guide a non-prot organization to anticipate and respond to themyriad challenges in the sector today. Based on astudy of fteen exemplary nonprot boards, andthe combined experience of a team of nonprotprofessionals, this paper looks closely at what ismeant by board leadership, what forms that lead-ership takes, and how to create an organizationalculture that encourages and supports board mem-

bers to step up to their leadership responsibilities.

BACKGROUND

Governance Matters, the sponsor of the project, isa collaboration of nonprot executive directors,board members, funders, consultants, umbrellaorganizations, and other professionals interestedin raising the standard of governance withinNew York City’s nonprots. The Board Leader-ship Project was developed to encourage moreactive leadership on and by nonprot boards. Wewanted to explore why some boards and individ-ual members step up to take the lead at times ofchange and why others do not. We also wantedto nd out how boards create a culture of leader-ship, and what prepares board members to play aleadership role.

1 Barbara Miller can be reached at [email protected] ; andJeanne Bergman at [email protected]

The members of the project designed a researchstudy to identify and describe the practices that non-prot boards have used to develop, motivate, train,and sustain board leaders. The research strategy wasbased on the assumption that leadership is mostapparent at times of transition or crisis, such as:

n the early stages of organizationaldevelopment,

n transition from a founder/executivedirector or long-time board chair,

n responding to a major new initiative fromexternal sources/conditions, and/or

n implementing the decisions of an internalplanning process.

Leadership was operationally dened as boardactions that have served to move organizations for-ward so they can successfully meet these challenges:

n mobilize action to further the mission,n help the organization adapt to changing

circumstances,n respond to crisis,n identify opportunities for change and

growth, and/orn create future leaders.

The team then asked a variety of sources, includ-ing umbrella organizations, technical assistanceproviders, funders and academics, to identify New

York nonprots whose boards demonstrated thistype of leadership. Out of the fty organizationsrecommended, fteen were selected and inter-viewed by Governance Matters volunteers. Basedon the ndings, a series of hypotheses about boardleadership were developed. To further test andrene the hypotheses, the project scheduled threefocus groups with participating executive directorsand board leaders.

Developing Leadership onBoards of Directors


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A team from New York University’s WagnerSchool’s Non-prot Management Capstone Semi-nar then reviewed the case studies and identiedthose that best exemplied board leadership as itwas dened. This team also conducted a literaturereview to determine gaps in the literature relatedto this topic. Concurrently, a group of GovernanceMatters members were convened to discuss theirexperience with board leadership at times of crisis(particularly during times of leadership succes-sion) and to outline effective steps to develop aneffective board culture. Finally, the Board Leader-ship Project Team took all of the material that hadbeen collected and added their own experiences toproduce the nal products.

REFLECTIONS ON WHAT IS MEANT BY LEADERSHIPON NONPROFIT BOARDS

As we reviewed the input from our exemplaryorganizations, the Board Leadership Project Teamidentied the following characteristics of boardleadership.

Leadership Qualities

A number of personal qualities of leadership wererepeatedly identied by participants in our study.Some of these qualities may seem innate, but manyarise from the alchemy of blending the desire tomake a difference , together with known/learnedskills and the opportunity to act. Good board lead-ers exhibit passion, commitment and vision, andthey articulate these clearly.They have the ability to commu-nicate with and engage others.They know what they do notknow, are willing to take risks,are comfortable seeking outsidehelp, and are honest and forth-right in recognizing and namingproblems. They are able to sup-port the executive director bymaking time available to sustainhis/her vision and implementation. However, theboard leader’s rst loyalty is to the mission and theconstituencies the organization serves.

Boards Govern Always, Lead Sometimes

While the basic governance responsibilities ofboards of directors are constant, leadership on agood board is more uid, ebbing and owing as cir-cumstances and organizational life cycles require.Board leadership is expressed most powerfully andcrucially during times of transition and crisis; suchperiods are also when the absence of leadership ismost visible and most devastating to an organiza-tion. When things are running smoothly, the moreroutine governance duties are primary and boardleadership is devoted to streamlining systems, stra-tegic planning and increased board fundraising. Atsuch times, the board’s leadership (in the sense of

control and direction) may seem more below thesurface. This is most often the case when there is astrong, skilled and effective executive director.

Ask Questions!

Leadership is often dened as having answers, ortaking charge. However, one of the most importantforms of leadership that board members undertakeis simply to ask substantive questions. In somecases, board members will be part of research-ing and responding to these questions. In others,the board will rely on the executive director and/or other staff members for the information andinput necessary to determine appropriate actions.Leadership in such cases takes the form of rais-ing the questions and listening for responses thatmake sense.

In general, questions will fall inthe following categories.

1. Compliance

As part of their governanceresponsibilities board membersneed to ask management to dem-onstrate compliance with thelaws and requirements govern-ing nonprot organizations, and

with the organization’s commitments to clients,donors and other key stakeholders.

Board leadershipis expressed mostpowerfully and cruciallyduring times of transitionand crisis; such periods arealso when the absence ofleadership is most visibleand most devastating toan organization.


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2. Strategy

Board leadership related to programs and prioritiesis strategic in nature. Their focus is less on why wedo things a certain way, and more on whether or notthe organization is doing the right things. Strategicquestions from the board encourage board and staffto identify internal and external changes and trendsthat affect clients, funding and activities so theorganization can formulate appropriate responses.These questions help keep the focus on the big pic-ture rather than on operations, and are typicallyfuture oriented. Finally, they encourage and shapeboard leadership by helping board members identifyways that they can help the organization respond toemerging needs and opportunities.

3. Evaluation

In most cases board members do not have the samelevel of programmatic expertise as the staff. Ascommunity members holding the organization intrust on behalf of the public, board members needto ask questions that help them evaluate the impactof the organization’s work. Byraising the question of how theorganization will measure suc-

cess, and by systematically askingfor benchmarks related to thesemeasurements, the board leads byfocusing staff attention on resultsinstead of methods. Comparingthese results to those of otherorganizations in the same eld is particularly help-ful. Also tracking results over time provides usefulinformation to allow the board to measure success.

4. Resources

Many boards spend a good deal of time thinkingabout and engaging in fundraising. One impor-tant question that can get overlooked is to ask howthe organization is allocating the resources it doeshave, and to ensure that this allocation is reectiveof the organization’s priorities. Another set of ques-tions relates to donor interests and trends. What aredonors interested in? How has that changed? Shouldwe (and, if so, how can we) position ourselves in

relationship to these interests? Finally, the boardshould ask and determine what role it needs toplay in maintaining current resources as well as inattracting new or increased support.

5. Board Structures and Systems

A board is strengthened by asking questions aboutits own ways of working to make sure that its oper-ating and decision-making practices keep up withchanging demands, shifting responsibilities, boardsize and composition. A periodic self-evaluationcan help board members determine if they are pay-ing attention to that which is most important, andif there are smarter ways for them to work individu-ally and collectively in order to achieve their goals.

Leadership from Any Seat

There is a tendency to think of leadership in termsof hierarchy, with the board chair playing thestrongest leadership role. It is certainly true that aneffective board chair contributes enormously to theboard’s productivity, and that a poor board chair

can be a signicant obstacle toperformance. Every board mem-ber, however, has a leadershiprole to play. Any board membercan and should raise the kinds ofquestions described previously.Every board member should havea role to play to move the board’sagenda forward and to fulll the

board’s oversight role. Fundamentally, leadershipentails speaking up when you have a concern andcontributing what you can to make the organiza-tion successful.

Different Leadership Styles

Not all forms of leadership are recognized as such.In fact, often leaders do not recognize their ownleadership or leadership potential. One of the les-sons of our study is that people often became leadersbecause someone they respected called on them tolead. Also, leadership may take on very differentattributes in different cultures, as well as among

Every board membershould have a role

to play to move theboard’s agenda forwardand to ful ll the board’soversight role.


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different ethnic, age and/or gender groups. Onecommunity may admire forceful and outspokenleaders while another might respond to a more con-sensus-oriented approach.

Different organizational circumstances call fordifferent leadership styles. At times of upheaval aconsensus builder may be needed. If real change isneeded to move the board forward, a more decisiveleadership style may be called for. One organiza-tion described two types of leaders: Visionariesand Implementers. In the rst group are the strate-gic thinkers who have imagination and are focusedon “the long haul.” The second are those who cangure out what is needed, right now, in order to

make something work and who enjoy concretetasks. They can also help the executive directorthink through the impact a new undertaking mayhave on the organization’s ability to maintain itsregular operations.

DEVELOPING A BOARD CULTURETHAT PROMOTES LEADERSHIP

As we spoke with exemplary nonprot boards, andreected on our own experiences in the eld, wecame to recognize the importance of the board’sculture in determining whether or not board mem-bers are willing and able to step up at times oftransition. Board members place a high value onefciency because there are so many competingdemands on their time. They are therefore oftenreluctant to invest the time required to build boardcohesion and strong working relationships and maybe unprepared to work well together at times ofchange or crisis.

What is Board Culture?In the context of nonprot boards, culture refers bothto organizational culture – the shared meanings,understandings, ways of interacting, expectations,vocabulary, values and beliefs of the board mem-bers as a whole – and the individual cultures of allthe members (which over time can transform theboard’s culture). Board culture is crucial to perfor-mance and leadership because it can be a powerful

and sometimes invisible force that pressures mem-bers to conform to the established behaviors of thegroup. On the positive side, organizational culturescan inspire leadership, open debate and risk-taking.On the other hand, these unspoken norms can havea negative impact, causing new and veteran mem-bers alike to feel intimidated, or silenced, and thosewho would like to initiate changes in the organiza-tion may have difculty introducing new ideas.

Organizational cultures tend to be self-perpetuat- ing. People who are uncomfortable with the boardculture as it is will leave, and those who like the sta-tus quo will feel welcomed and supported. Founders’boards are obvious examples of boards with cul-

tures oriented to follower-ship , but other boardsmay also silently (or actively) discourage membersfrom asking questions, taking the initiative or rais-ing criticisms. The persistence of organizationalculture can make diversifying a board difcult: newmembers from new or different constituencies maybe denied meaningful roles or otherwise be infor-mally silenced. Board members need to be aware oftheir organization’s culture, discuss it openly, and, ifthey want to change it, do so intentionally and withsincerity of purpose.

Boards are social groups and each has its owndistinctive culture. Boards that work well haveincorporated governance and personal initia-tive into their organizational culture. They haveenthusiasm, momentum, and exibility. Effectiveleadership boards foster environments where direc-tors trust and respect one another, communicateclearly and often, know their organizations well,care deeply about mission, and understand theirlegal and moral responsibilities.

The board’s culture is also uid and changes as themakeup of the group and the situations, conditionsand issues shift. Clarity and openness (and, con-versely, confusion and secretiveness) are features oforganizational culture that can be inculcated.

Characteristics of a Productive Board Culture

The following elements emerged from our researchas essential to a productive board culture.


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1. Respect. When asked to reect on their success,the board members of a parents’ advocacy organi-zation pointed out that respect is crucial. There isrespect – among the current board for each otherand for the executive director – that comes fromacknowledging and honoring their mutual responsi-bilities for their work and for the organization. Onemember commented, “A board should be a groupthat each member is proud to be part of.”

2. Communication and Transparency. Good com-munication was cited by the representatives ofalmost every organization studied as a key to theireffectiveness. Board members are encouraged toask hard questions and get honest and complete

answers. For example, at a settlement house, thenew president and executive director instituted pro-cedures that ensured that board members were keptfully informed about developments in the organiza-tion and the neighborhood, and, therefore, were ableto respond appropriately to a changing situation.As a result, even in the face of caustic complaintsfrom members of the local community, the boardremained committed to changebut resisted being drawn intopointless arguments and con-

frontations with neighborhoodresidents.

3. The Ability to Learn from Con- ict /Debate. Board members ofa parents’ advocacy organizationfound a way to use conict to continue the organi-zation’s forward movement. They, and others, pointout that when you give everyone a voice, conictwill arise. As the executive director says, “Give peo-ple the opportunity to express their opinion, and do

not react negatively when they do. Really take [theircomments] to heart.”

n The willingness and ability to strugglethrough conict can strengthen a boardand the organization. The ability to dis-agree productively is one sign of a strongboard culture. Such debate often results indecisions that are more fully thought out.

Civility without debate may mean that theboard admits only other like-minded peo-ple or that only a select group are the realdecision makers. Conversely, debate with-out civility often reects individual agendasthat are not motivated by concern for mis-sion, and rarely leads to better decisions.

n Directors from the settlement house’s boardstressed that when an issue is presented forboard consideration, all related possibilitiesand solutions are discussed – sometimesvigorously – and, therefore, the decisionsreached tend to be representative of all or agreat majority of the directors. The president

manages disagreements well and the direc-tors defer to his judgment and decisions. Saysthe board president, “Don’t give me a smiley-smiley group. I make [vigorous discussion]happen by encouraging freedom of speech.”

n For others, consensus is seen as an indicatorof board health. For example, the presidentof a counseling organization says: “Not

only does the board rarely everget into a big argument, there’snot factionalism within this

board. But there is a respectful-ness, collaborativeness and asense of pride that generationsof trustees share, which has tocome from something, and itdoes not come from something

intellectual. It comes from something moreemotional or spiritual, the sense of purposethat they share together. That’s what giveslife to the organization.”

n The role of the board chair is critical to theboard’s ability to engage in open discus-sion. The board chair of an advocacy anddirect service organization for the formerlyincarcerated makes sure that everyone hasa voice and is heard. He realizes that therewill not always be consensus, but generallythe group does reach an agreement. Occa-sionally, a board member who is known to

Good communicationwas cited by the

representatives of almostevery organizationstudied as a key to theireffectiveness.


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hold a particular point of view might beapproached prior to the meeting to allowfor a more open and thorough discussionoutside the board meeting. But the intent ofthis conversation is to make sure that thatdirector feels like his/her viewpoint is aired,not to stie that person’s participation.

4. Trust and the Ability to Take Risks. Risk andtrust go together. Board members are willing totake greater risks if they trust each other and/or theindividuals in leadership positions. It helps to havesteps for assessing the risk, making it more manage-able, and having multiple go/no points, particularlywhen contemplating new initiatives.

HOW BOARDS CREATE A CULTURE THATPROMOTES LEADERSHIP

We have found the following practices key to creat-ing a productive culture on a board:

n Recruit people to the board who have a passion for your mission.

n Connect trustees with the organization’swork through direct experience, conversationswith program staff and compelling stories

that illustrate the importance of the organiza-tion’s work.

n State expectations of board members up frontduring the recruitment process.

n Make time to talk together as a board aboutthe culture that you want to create or per- petuate on the board, and how you can worktogether most productively.

n Let potential board members know about theculture of the board up front.

n Create rituals to celebrate achievements,recognize people who have made a con-tribution, and mark new moments in anorganization’s history.

n Compare how the board operates with theorganization’s values, and determine if thestructure and the values need to be moreclosely aligned.

n Acknowledge the contributions of those whohave made the organization what it is today,and then focus on how to maintain the found-ing principles in a changing environment.

Recruit individuals who are passionate about themission. When asked what motivated them to stepup to leadership, even in times of crisis, board mem-bers talked about their belief that the work of theirorganizations needed to be continued for the sake ofthe community. Their commitment to the missionwent beyond their loyalty to any one individual. Intimes of crisis, board leaders show personal com-mitment, determination and courage, each of whichis crucial to the maturation of the full board. One

board member offered the following observation:What helped our organization deal with thecrisis was the deep commitment by a lot of theboard at that time that the organization wasso valuable that it had to survive. Many of theboard had come from the trenches and under-stood the value of the program and the needfor the organization. The incoming chair tooka rm hold. The search committee stepped upto the plate. And the executive committee func-tioned in a supportive role once the executivedirector was chosen.

Nonprots are often tempted to add members tothe board for other reasons than passion – a per-son’s expertise is needed or their nancial support issought. One board member responded by saying:

Some not-for-prots will look at nancial meansas the most signicant issue, to nd a trusteewho’s sufciently wealthy that they could be asubstantial contributor to the work of the par-

ticular organization, or that they are positionedin such a way that you can leverage their inu-ence and support to others, and that’s why youwant them as trustees. Well, I would be dishon-est if I didn’t say that some of those things gureinto our selection of trustees.

While another board member responded:


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In recruiting new board members I need tosense there is a passion for the mission. I haveto see there is int that catches a spark… believ-ing, of course, that if somebody connects to themission, they would do whatever they can withwhatever resources they might command tosupport and to help the organization further itsobjectives. But the most important componentof their trusteeship has to be do they connect orcan they be helped to connect more deeply tothe mission of organization. And you can usu-ally pick that up very quickly.

Keep a board’s passion alive by nding ways to keeptrustees closely connected with the organization’swork. One former board member of the counselingorganization commented:

We have been very gifted in who has been ledto us or we have found, in that they do under-stand the mission of the organization, the painthat people feel when they’ve lost a loved one orwhen you’re the patient that is dying. Our trust-ees have felt that, and they have felt it becausemaybe they’ve experienced it, but they’ve alsoheard the stories of counselors’ experiences. It’s

those stories of how they’ve helped other humanbeings that brings the organization alive. Thebest way to have that happen is to get the staffand trustees together.

A current board member from the same organiza-tion observed:

I think we’ve often said to one another that theorganization is a history of stories, and eachof these encounters between a counselor anda family, or counselor and a very ill person,has its own story and takes on a life of its own.More often than not, they are wonderful stories,beautiful stories.

Use strategic planning to create a forum and acontext for leadership. Strategic planning canmotivate board members to become more involved,and to step up to their governance responsibilities

without risking the upheaval inherent in a crisis.The process allows the board to identify urgentopportunities that include exciting possibilitieslike signicant expansion, purchasing a facility, ordeveloping programs for a new constituency. Whenthese opportunities present themselves, previouslyinactive board members may be inspired enough tointensify their commitment and step up as leaders.

The majority of the organizations participating inthis study linked the emergence of board leadershipwith a strategic planning process. For example, theparents’ advocacy group used the process as a wayof refocusing the board’s attention on the mission,and created a framework in which the discussion of

board composition could be held without personal-izing the decisions made. In other words, the formand function of the board grew directly out of thestrategic discussions.

In the organizations we studied it was often theexecutive director who introduced the planningprocess and the importance of strategy to the board.In all cases board members played leadership rolesin dening strategy and shaping the direction ofthe organization. Board members of the counselingorganization, most of whom have corporate back-grounds, described their process and philosophy asfollows:

One of the things that [the President and CEO]has taught me is that if you dream and you havea dream that makes sense to other people, themoney will be there, and you don’t have to raisethe money before the dream. So it’s a questionof articulating what we’re about and making thecase so compelling that the community comesforth and supports it in a way that makes it work.

But I don’t think you raise the money rst. Ithink you dream rst. You have your strategicplan, and then you go raise the money for it…If there is proper leadership – the more you dothe better you get. No decision is made at [ourorganization] without the context of the strat-egy. We have seven task forces for the plan, plusthe standing committees of the board. Quite abit is done with a small group of people here.


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Build high expectations into the culture. Per-haps the most crucial dimension of organizationalculture for encouraging leadership is high peerexpectations. Indeed, boards seem often to repli-cate themselves: weak boards expect little of newmembers, while strong boards seek out similarlyengaged individuals. On one of the more highlyperforming boards we studied, many membersexerted leadership and worked hard because therewere clear expectations that service to their boardwas a serious and demanding job.

Some accountability mechanisms that the boardswe interviewed use are as follows:

n One group requires 100% attendanceat board meetings. Several others trackattendance and ask members who miss thenumber of meetings specied in the bylawsto either recommit or resign.

n A rigorous recruiting system broughtengaged, effective directors to a settle-ment house. Members hold each other to ahigher standard of performance and evenpressure the chair to take action on unsat-isfactory service, such as absenteeism.

n At an organization that works with theformerly incarcerated, the chair of theboard said that he, too, had become amore demanding recruiter over the years.He has implemented a more rigorous vet-ting process – checking references, askingabout other board obligations, and seekingan alignment with the agency’s values, aswell as demonstrated leadership and man-agement experience. He makes sure thatcandidates understand that they are sign-ing on to do a serious job, for which theywill be held accountable by their peers andthe chair. He has found that these stan-dards, far from discouraging prospects,have improved retention and directorengagement.

n Institute an annual evaluation of theboard’s performance in relationship toits goals.

Negative sanctions are seldom necessary on strongboards. The clear focus of these boards on theirwork and their goals creates a strong feeling ofcommunity, rewards accomplishments and enthu-siastically integrates new members.

Such high standards contrast sharply with theapproach of organizations whose recruitmentpitches emphasize the minimal demands that willbe put upon board members beyond lending theirnames. Getting people to join a board by assur-ing them they need to do nothing only guaranteescomplacency.

Establish and clearly articulate norms for boardengagement. Creating a productive board culturerequires conscious effort to continuously encour-age and provide opportunities for members’ activeinvolvement. A board member from an educationalorganization observed:

You need to attend to group process and makethings explicit. The old ED wanted everyone toget along. I want all the ugly stuff to be out in

the open. At a recent meeting, the new chairhelped discussion open up. She has the skills.In the past, people said they were open but theyweren’t. Now they really can speak.

To ensure that you are real ly acting in accordancewith the norms you want for your board requiresperiodic discussions about the board’s culture,and explicit agreements about how to be mostproductive in board and committee meetings.These discussions are often part of a board retreat

agenda in which the board reviews its progress forthe year and plans for the upcoming years’ goalsand objectives.

Examples of ground rules that the groups we sur-veyed have established, whether explicitly orimplicitly, include:


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n Be open and dedicated to informationsharing.

n Focus on the common good, not individ-

ual egos.n Make decisions by consensus.n It’s okay to make mistakes – “we’ll grow

from them.”n Be will ing and able to change how things

are done.n Take calculated risks.n Trust the group to be able to gure it out.n Maintain an uncompromising focus on

mission.

Create opportunities for board members to get toknow each other. Many boards pride themselveson the efciency of their board meetings. “We’vegot the meeting down to an hour!” However, ifboard members do not have the opportunity to getto know each other – and to work together effec-tively when things are going smoothly – they willnot have the skills needed to come together to facedifcult challenges. Part of what allows groups ofpeople to work together effectively is to have some

sense of who each person is as an individual andhow they think.

Mark Moments of Change. Simple rituals forthe initiation of new members, the installationof ofcers, and/or the retire-ment of long-time members canstrengthen a board’s culture.Rituals of achievement and cel-ebrating major accomplishmentscan allow the whole group toshare in the resulting sense ofpride and momentum, which, inturn, helps deepen their involve-ment and raises their level offunctioning.

Retelling the story of the orga-nization’s founding helps to reinforce the board’ssense of purpose, keeping members focused on

mission and goals rather than allowing them todrift into more personal agendas.

The structure of the board can reinforce the orga-

nization’s values and culture. The structure of theboard of directors is also important in terms ofsupporting the development of a culture of leader-ship. It is also true that the systems and structuresthat the board develops at one point in the organi-zation’s development are likely to need to changeas the organization matures. According to a boardmember with a parents’ advocacy organization,“There may be a lot of trial and error. It takes timeto discover the right structure.”

Charge committees with clear objectives that aretied to the strategic plan. Effective committeesare a key element of structure that supports lead-ership. Providing all members with focused workand important responsibilities is crucial to devel-oping and sustaining effective board leadership.Board members’ knowledge of and commitment tothe organization is deepened and strengthened byengaging them in meaningful committee work. Amuseum we studied re-organized the board to bet-ter match the management structure. They foundthat the new structure helped communicationand coordination and increased board and staffaccountability for outcomes.

Balance future orientation with an appreciationof the past. Board members atthe museum we studied knewthat they were entrusted withthe responsibility of perpetuat-ing the museum’s legacy andfounding vision. However,board members also understood

that simply looking backwardto the museum’s many accom-plishments and awards is notenough. They have to focustheir attention on opportuni-ties to serve the community in

the future. The organization can be both groundedand adaptive. Too much emphasis on the legacy

Retelling the story ofthe organization’sfounding helps toreinforce the board’ssense of purpose, keepingmembers focused onmission and goals ratherthan allowing them todrift into more personalagendas.


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can paralyze an institution, threatening to embalmcurrent practices instead of preserving core valuesof service and excellence.

ADDITIONAL KEYS TO BOARD LEADERSHIP

1. Crisis is not all bad.Like the proverbial ill wind, there’s somethingto be said for a good crisis to wake up the boardand move them to action. Sometimes a crisis givesboard members a focus for their efforts, which theymay not otherwise have had. Some situations thatare perceived by the board as a crisis, such as thedecision of an executive director to leave, may infact be part of the natural life cycle of an organiza-tion. Executive transition, or genuine emergencies,force boards to fully assume their governance andleadership responsibilities. Once they learn to doso, it is easier for board members to continue toplay a more active role even after the transition iscomplete. So while we do not recommend goinginto crisis, do recognize that there can be long termbenets for board leadership if the board is ableto successfully respond to the situation. Short ofa crisis, an urgent opportunity (such as the abil-

ity to purchase a building or take over a programfrom another agency) can also serve to galvanizethe board and help them learn to fully assume theirleadership responsibilities.

2. Leadership is both recruited for anddeveloped.Are leaders born or made? The clear answer is both.ffective boards and executive directors constantlyrecruit for and build board leadership capac-ity. They also continuously plan for succession,

even during periods of routine board governance.Strong boards create and maintain expectations,structures, processes (including regular training)and opportunities that build and elicit leadershipso potential leaders can emerge. Practices that helpensure that boards can and will fulll their leader-ship responsibilities include:

n Train inexperienced board members inmeeting facilitation and volunteermanagement.

n

Have a transition period of a year so thatan outgoing committee chair or ofcer cantrain their successor. One approach is forcommittees to have co-chairs, with oneco-chair being the more experienced andthe other being the person who will takeover responsibilities.

n Create a clear “career path” through theboard – from committee participation tocommittee leadership to becoming an of-cer – so people can take small steps that

lead to formal leadership roles.n Long time board members need to step

back so that new leaders can step forward.They can help newer members becomeleaders by mentoring them and makingthemselves available as needed rather thanby holding on to leadership responsibilities.

Although it does not occur to many organizations,it is possible and desirable to include questionsabout leadership skills and interests when consid-

ering potential board members. Ask candidateswhether they would be willing to assume a lead-ership position on the board over time, and whatexperience they have as leaders.

3. Executive directors have an important role indeveloping board leaders and board leadership.While some executive directors may prefer pas-sive boards with little initiative, great executivedirectors welcome board initiative and oversight.Executive directors help board members develop

the knowledge they need to be effective ambassa-dors for the organization. For example, they inviteboard members to join them for key meetings withgovernment agencies and foundations so they canlearn the agency’s values, the appropriate languagewith which to represent it, and the political andbureaucratic world within which it must operate.They also encourage board leadership by sharingthe issues facing the organization with the board,


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giving the board the information they need to makea useful contribution, and allowing board membersto be active partners in formulating responses.

CONCLUSION

Leadership on boards takes many forms, rangingfrom asking useful questions about the direction,priorities and practices of the organization, toassuming responsibility for addressing the ques-tions raised. In order for board members to feelcomfortable and motivated to assume their leader-ship responsibilities the organization has to engagein practices that allow board members to developthe skills and conditions that promote leadership.

Doing so means revisiting the balance betweenefciency and effectiveness, creating opportunitiesat board meetings for real discussion and debatewithin a productive framework, and nding waysfor board members to get to know each other on apersonal level so that they can work together moreeffectively. Board members are most likely to stepup to fulll their leadership responsibilities whenthey start with a passion for mission, since it is thispassion that motivates volunteers to overcome theirnatural reticence to make waves and make whole-

hearted commitment to the organization. n

ReferencesBoard Leadership Project, Governance Matters website,

www.governancematters.orgAngelica, M. P. (2000). Keeping the peace: Resolving conict

in the board room. Fieldston Alliance.Axelrod, N. R. (2007). Culture of inquiry: Healthy debate in

the boardroom. Washington, D.C.: BoardSource.BoardSource, (2003). Assessment for nonprot governing

boards. Online Tool.Bobowick, M. J., Hughes, S. R., & Lakey, B. M. (2004).

Transforming board structure: Strategies for committeesand task forces. Washington, D.C.: BoardSource.

Bradshaw, P. & Jackson, P. (2007, Summer). Loyal o pposition. The Nonprot Quarterly.

Flynn, O. (2004). Meet smarter: A guide to better nonprotboard meetings. Washington, D.C.: BoardSource.

Holloway, J. (2005, Winter). Silence = bad strategy. StanfordSocial Innovation Review.

Special thanks to the other members of the BoardLeadership Project team: Michael Davidson, Anne E.Green, Barbara Krasne, Elizabeth C. Levi, and Roy Leavitt.


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Mary Hiland, organizational consultant andexecutive coach 1

C onventional wisdom emphasizes the impor-tance to a nonprot organization of its coreleadership: a healthy board chair-executivedirector relationship (Eadie, 2001; Howe, 2004;Lechem, 2002; P. C. Light, 2002). Organizationaleffectiveness is at stake when this relationshipis weak, or worse, dysfunctional. While such anassertion may seem intuitively correct, there is alack of empirical work that explores the dynamicsof this key relationship or its inuence, if any, onthe nonprot organization (Brown, 2000; Miller-Millesen, 2003).

In the nonprot governance literature, consultantsand practitioners prescribe the roles and respon-sibilities of board chairs and how those roles and

responsibilities are shared with, or distinct from,those of the executive. These typically one size tsall job descriptions fail to consider the incrediblediversity of the sector. In addition, beyond to do lists and role clarications, there is very little thathelps board chairs or executives anticipate andeffectively manage the complexities of their rela-tionship. The roles, as typically assigned, create aparadox in which the board chair is at once pro-viding both support and oversight. This paradox,coupled with the real possibility that both the boardchair and the executive are experienced leaders,highlights the importance of learning more aboutthe dynamics of this relationship than simply whoshould do what.

1 Mary Hiland can be reached at [email protected]

THE STUDY

To learn more about the dynamics and inuenceof board chair-executive director relationships, astudy was conducted in 2005 with board chairs andexecutives from 16 nonprot 501(c)(3) organiza-tions in Silicon Valley, California. Semi-structuredinterviews with open-ended questions were doneindividually with each volunteer participant to

elicit descriptions of the dynamics in their relation-ship and its effect on the organization.

Participants and their organizations were selectedon a rst come, rst served basis so their character-istics were unpredictable. Fourteen of the 32 studyparticipants were female (44%) and 18 were male(56%). Half (8) of the study pairs were of mixedgender and half were the same. The lack of ethnicdiversity among participants was disappointing:94% were Caucasian.

There was diversity among the organizations in thestudy. The elds of service ranged from recreationto the arts to organizations that provide servicesto other nonprots. The largest cluster was humanservice—25% (4) of the organizations. Studynonprots ranged in size (measured by annualexpenditures) from less than $500,000 to over $10million. Time in the relationships ranged from 6months to 5 years.

Social capital is the resource that is created as a

result of interpersonal relationships within a socialstructure (Coleman, 1990). Social capital theoryexplains how relationships can add value to orga-nizations and is, as yet, under-explored as an assetin nonprot organizations (Cohen & Prusak, 2001;King, 2004). Social capital theory was used as a lensin the study to understand whether and/or how theboard chair-executive director relationships addedvalue to nonprot organizations.

The Board Chair-Executive DirectorRelationship: Dynamics that Create

Value for Nonprofit Organizations


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Study ndings revealed cumulative patterns ofdynamics that, when integrated, formed a typologyof good to great board chair-executive relation-ships. This pattern was built fromthe following a) types of inter-personal dynamics, b) levels oftrust, c) what the pairs worked ontogether, and d) how the above,combined, linked to social capitalcreation in the organization.

CHARACTERISTICINTERPERSONAL DYNAMICSIN THE RELATIONSHIPS

Based on study participants’descriptions, ve types of inter-personal dynamics characterized the boardchair-executive relationships: facts-sharing, ideas-sharing, knowledge-sharing, feelings-sharing andgive-and-take.

Facts-sharing

Facts-sharing was dened as a one-way giving ofinformation that did not involved the engagementof the other party in the exchange. This interper-sonal dynamic type was primarily demonstratedin reports of how much information the executiveshared with the board chair and if it was experi-enced as enough. Facts-sharing was the most basicof the interpersonal interactions and was evident inall study pairs.

Ideas-sharing

The ideas-sharing dynamic represents brain-storming, problem solving, and/or thinking things

through together. In contrast to facts-sharing,ideas-sharing involved the engagement of bothparties in the interaction—a two-way exchange.Initiated by either party, the focus of board chair-executive ideas-sharing ranged from a quickcheck-in to consulting each other about orga-nizational issues to the board chair serving as asounding board for the executive.

Knowledge-sharing

The third interactions type was knowledge-sharing—dened as learning and/or coaching

interaction. This type was dis-tinct from sharing facts or ideasin that there was a teaching com-ponent and identiable contentlearned about the organization,something outside the orga-nization or about the personhim/herself. The most commonexamples were coaching of theexecutive by the board chair andthe executive teaching the board

chair about the organization ornonprots in general.

Feelings-sharing

The participants’ descriptions of support, reas-surance, caring and/or appreciation were denedas the feelings-sharing type of interaction, whichvaried in intensity among the pairs. Expressionsof support most often came from the board chairto the executive; expressions of appreciation wereexchanged by both.

Give-and-take

The give-and-take dynamic reected the boardchair or executive’s adaptation to the other per-son’s style, personality and/or preferences andtheir process of working out differences. It isunderstood that executives need to adapt to newboard chairs as they may transition several timesover executives’ tenure and the give-and-takedynamic included, but went beyond, the executiveadapting to a new board chair. When this dynamicwas present, it was quite evident that both partiesin the relationship made changes or concessions toaccommodate the other or to achieve alignment ina variety of circumstances.

Examining these types of board chair-executiveinterpersonal interactions from the perspective oftrust building provided a framework for under-

Based on studyparticipants’descriptions, ve types ofinterpersonal dynamicscharacterized theboard chair-executiverelationships: facts-sharing, ideas-sharing,knowledge-sharing,feelings-sharing and

give-and-take.


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standing their implications. The more diversethe interactions in the pair, the stronger the trustbuilt (Mishra, 1996). The interactions providedthe contexts in which trust building behaviorswere enacted and the pairs with the strongest trustdemonstrated all of the interaction types. It isinteresting to note, though, that the frequency ofinteractions and the amount of time spent togetherdid not relate to the good to great framework thatcharacterized the other study ndings. It was thequality, not quantity, of interaction that mattered.

THE STRENGTH OF TRUST

There are numerous, different conceptualizations

of trust in the organizational and social scienceliterature (Bigley & Pearce, 1998). These varied con-cepts reect trust’s complexity. Most address trust

in the context of personal, as compared to working,relationships. The literature on trust-building inorganizations is limited. Integrating and adding tothe work of Lewicki and Bunker (1996), Reina andReina (1999), and Mishra (1996), a model of trustbuilding in organizations was formulated.

Nineteen different trust-building behaviors wereidentied. Each was linked to one or more of theinteraction types discussed above and each twithin one of three levels of trust in the model:calculus-based (weak trust), knowledge-based(moderate trust), and identication-based (strongtrust). These levels are cumulative, i.e., knowl-edge-based trust builds on calculus-based trust;

identication-based trust builds on knowledge-based trust. Drawing on Mishra’s research, the levelof trust assessed in each study pair was determined

Trust building

Calculus-based Trust:assessing risk and reward

Identification-basedTrust: identifying with

each other

Knowledge-basedTrust

ContractualTrust (Trust of

Character)

CompetenceTrust (Trust of

Capability

CommunicationTrust (Trust of

Disclosure)

“Getting toknow you”:

Investing timeto build

relationship

Trust begins

Trust BuildsTrust Builds

Figure 1. Trust-building model


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committees. There were three pairs, the planning pairs, whose work together evidenced only themanaging and planning patterns.

Leading

Six study pairs were managing, planning, and lead-ing. These are the leading pairs. They describedworking with engaged boards on mission-relatedand strategic work. These leading pairs describeda web of board, staff and community relation-ships. The labeling of this pattern as leading is notintended to imply that the other study board chairsand executives were not leaders. The distinctionis the level of engagement the pairs had with the

external community as well as the level of engage-ment they helped to create between their boardsand the community. Neither was evident in man-aging or planning pairs.

LEVELS OF TRUST AND THEWORKING-TOGETHER PATTERNS

The study found three levels of trust and threepatterns of how pairs worked together. Was therea relationship between these two dimensions?There was. Using Mishra’s approach to measuringthe strength of trust (i.e., the number of differenttrust-building behaviors evident) revealed thatthe strength of trust in the leading pairs was 67%higher than in the planning pairs and 133% higherthan in the managing pairs. The planning pairs hadstronger trust levels than the managing pairs. Onlythe leading pairs had achieved the highest level:identication-based trust. The following reectsthese ndings using a good to great framework:

Good: managing pairs Managing focus + low to moderateknowledge-based trust

Better: planning pairs Planning focus + moderate to highknowledge-based trust

Great: leading pairsLeading focus + identication-based trust

A nal question explored in the study was what,if any, inuence did the board chair-executiverelationship have on the organization from the par-ticipants’ experience? Given the framework, wasthere a relationship between the nature of that inu-ence, if any, and the good, better or great pairs?

BOARD CHAIR-EXECUTIVE RELATIONSHIPS’VALUE: SOCIAL CAPITAL CREATION

As noted earlier, social capital theory was used tounderstand if and how the study pairs’ relationshipsinuenced their organizations. Social capital is theasset created through relationships. It is “the stockof active connections among people” that makes

productive action possible in organizations (Cohen& Prusak, 2001, p. 4). Leaders have a critical role toplay in creating social capital that is useful to theorganizations they serve (Cohen & Prusak, 2001;King, 2004).

All study participants believed that their rela-tionship mattered to the effectiveness of theorganization, but, prior to the study few hadreected on “How?”. The study was not structuredto specically measure social capital. However,when participants were asked how their relation-ships affected the organizations their responseswere characteristically about key relationships andnetworks, and other benets associated with socialcapital. The primary elements of social capital areresources and relations (Lin, 2001). Individualscome to relationships “with resources over whichthey have some (possibly total) control and in whichthey have interests” (Coleman, 1990, p. 300). Theyengage in various exchanges and transfers of con-trol; that is, they form social relationships towardthe goal of achieving their interests. These interac-tions take place within a social structure. Unlikeother forms of capital (physical, human, intellec-tual), the resources that are social capital are onlyaccessible through social ties—they are not thepossessions or specic attributes of the individual(i.e., not human capital).

The good to great types of board chair-executivedirector relationships are discussed below in terms


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of the social capital created and the benets thataccrued to the organizations as a result. The pairs’strength of trust, focus of work, and the benets ofsocial capital creation all aligned within each type.

The Good Relationships

As the leadership team for the nonprot organiza-tion, the board chair and executive director havethe opportunity to build social capital with eachother, the board, the staff and other stakeholders.By denition, managing pairs were not work-ing in an engaged way with their boards or otherstakeholders. However, a trusting board chair-executive relationship alone can generate social

capital if that trust facilitates cooperative work rel-evant to organizational goals. “Even when socialcapital investments are made solely by individu-als who develop ties with one another, many realadvantages accrue to the organization as a whole”(Cohen & Prusak, 2001, p. 4). The level of trust inthe managing pairs, whose engagement with oth-ers was minimal, was a sourceof social capital but there was noevidence that these pairs inu-enced any social capital creation

outside of their relationship.These pairs created social capitalwithin their own relationship bybuilding trust, stating expecta-tions and working cooperativelyon agreed-upon goals. Thebenets for the organizationthey reported were improvedinformation sharing and betterdecision making.

The Better Relationships

In addition to developing social capital withintheir own relationships, the planning pairs cre-ated social capital by strengthening relationshipswith and engaging the members of their boardsof directors. They described doing this by jointlymeeting with each board member, appreciat-ing and tapping into board members’ individual

skills, leveraging board members’ networks, andfocusing on opportunities for strategic discussion.Planning pairs described inuencing their boardsto be more productive and operate on a strategicversus operational level. These pairs clearly valuedthe board as an important resource and workedtogether to tap that resource through purposefulrelationship building, thus, creating more socialcapital. As a result, per their report, the organiza-tion beneted from a well-performing board thatgenerated better information, additional resourcesand connections, and access to expertise.

The Great Relationships

The leading pairs worked together, with engagedboards, on issues of organizational vision, mission,and strategic focus. They described energy andsynergies in their relationship, and with the boardand the staff, that catalyzed organizational produc-tivity and engagement with the community. Theyreported leveraging the relationships and expertise

of the board as a result of howthey worked together and howthis enabled them to make manyconnections with key people in

the community such as fundersand legislators. One leading pairreported increased engagementwith local ethnic communi-ties around strategic issues thatthe board chair directly attrib-uted to the relationship with theexecutive director and how theyworked together.

Sources of social capital amongthe leading pairs included board relationships withstaff. One executive director described how theenergy of the board had spread to the staff and thatthe quality of the board that he and the board chairattracted contributed to high staff morale. Anotherboard chair described signicant involvementbetween the board members and staff in workingtogether in key projects and sharing expertise in theorganization.

The leading pairsworked together, withengaged boards, on issues

of organizational vision,mission, and strategicfocus. They describedenergy and synergies intheir relationship, andwith the board and thestaff, that catalyzedorganizational productivityand engagement with thecommunity.


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Leading pairs worked with engaged boards onmission-related and strategic work. Their boardswere active and lending their expertise to the orga-nizations in ways that went beyond their boardroles. These pairs described a web of board, staffand community relationships. The social capitalbuilt in these relationships facilitated access to avariety of resources—intellectual, nancial andsocial—needed by the organizations. The reachof relationships touched by these board chairs andexecutives spanned organizational boundaries.They reported attracting more people to the orga-nizations (e.g., volunteers) and emphasized thatrelationship resources were more fully utilized.

The leading pairs noted powerful impacts on the

organizations that resulted from their relationships,how they worked together and the social capitalcreated. Leading pairs described the inuence oftheir relationships on the organizations as motivat-ing, energizing, and engaging others (staff, boardmembers, and stakeholders) on the organizations’behalf. They described their own involvement withan engaged board of directors—individuals whowere giving “work, wealth, and wisdom”—and thevaluable personal connections their relationshipand their board members’ relationships yielded.

Leading pairs conveyed that, together, they helpedto create the condence and synergy that permeatedthe whole organization and improved effectiveness.

These ndings are reected in Figure 2 below.

BC/ED

The Board

The Community

SocialCapital

SocialCapital

SocialCapital

Confidence

Productivity

Better decisions

Better decisions

Better decisions

Information

Information

Information

Networks

Synergy

Resources

Connections

Energy

Effectiveness

LEADING:

Engaging withthe community

to achieve mission.

Access to theboards’ networks

and external relationships builds

social capi tal.

An engagedboard adds

social capi tal.

Building socialcapital with the

BC/ED relationship.

PLANNING:Working with anengaged board

on strategic issues.

MANAGING:Working on internaloperational issues

together.

WorkingTogether

Results in

Results in

Results in

Figure 2. Board chair-executive relationships’ in uence:building social capital and the bene ts


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DISCUSSION

This study provided a closer look at the dynamicsof the board chair-executive director relationshipin nonprot organizations and asked if and howthis relationship matters to the organization. Con-sistent with the literature (Carlson & Donohoe,2003; Howe, 2004; Light, 2002; Millesen, 2004)study participants responded with a resound-ing “Absolutely” when considering whether the

relationship mattered. Despite this strong con-sensus, or maybe because of it, there had beenno empirical exploration of why or how this rela-tionship matters to the nonprot organizationsexecutives and board chairs serve. By exploringthe interpersonal dynamics of the relationship andits impact, this study took a step toward under-standing the powerful potential of this importantleadership pair.

Figure 3. Shows the relationshipsamong all of the ndings discussed.

Interpersonalinteractions

Trust building

Calculus-based Trust

Facts

Ideas Knowledge Feelings

Identification-based Trust

Knowledge-based Trust

ContractualTrust CompetenceTrust

CommunicationTrust

BC/ED

The Board

The Community

SocialCapital

SocialCapital

Social

Capital

Give andtake

Prior knowledge

Confidence

Productivity

Better decisions

Better decisions

Better decisions

Information

Information

Information

Networks

Synergy

Resources

Connections

Energy

Effectiveness

LEADING:Engaging with

the communityto achieve mission.

Access to theboards’ networks

and external relationships builds social capital.

An engagedboard adds

social capital.

Interactions providethe opportunities for

building trust.

Trust Builds:Indentifying with

each others’ needsand preferences.

“Gettingto know

you”

The types of trust built influence how the BC/EDwork together and the social

capital they build.

The relationshipbegins withinteractions.

Building socialcapital with the

BC/ED relationship.

PLANNING:Working with anengaged board

on strategic issues.

MANAGING:Working on internaloperational issues

together.

BC/ED Relationship:Building Social Capital

WorkingTogether

Results in

Some BCs/EDsknew each

other before.

Investing timeto build

relationship.

Results in

Trust begins

Trust Builds:

Results in


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Trust-building was the primary dynamic in theboard chair-executive relationships studied. Thenonprot governance literature emphasizes theimportance of trust for an effective board chair-executive relationship but falls short of detailingthe interpersonal dynamics and specic behaviorsthat actually build trust. General statements thatinformation sharing and/or communication areimportant to the board chair-executive relation-ship do not reect the nuances of the relationshipdynamics. The great relationships all demonstratedidentication-based trust. Identication-basedtrust reects a closer, more personal relation-ship. Understanding these nuances can give boardchairs and executives the tools they need to builda great not just a good relationship; to value, notavoid, a more appropriate personal dimension totheir interactions. Building a personal connectionbetween the board chair and the executive direc-tor is not only desirable, but contributes to creatingsocial capital.

The leadingboard chairs were very involved and hadfrequent, direct contact with staff with whom theyworked on specic and varied projects. Contraryto the common view that this type of hands-on,

board involvement is characteristic of younger,less sophisticated nonprots, these participantschaired some of the largest, oldest and best-knownnonprots in the study. Open access to staff wascited several times by board chairs as a source oftrust in the executive.

The social capital generated by study pairs resultedin numerous benets for the organizations. Theseincluded: energy, productivity, synergy, links tonumerous networks, access to information, andimproved decision-making. This study reinforcesthose who note that nonprot organizations areuniquely suited to maximizing the potential andpromise social capital offers organizations (Chait,Ryan & Taylor, 2005; King, 2004). From generat-ing more productive work within the organizationto building critical, richly resourceful relationshipswith stakeholders, nonprot organizations have

the opportunity to offer meaning and connectionwhich attracts and builds social capital.

Purposeful attention to relationship building can

increase social capital. It was interesting that themajority of study participants indicated that theydid not think about working on the relationship—as compared to working on the business of theorganization. In the words of one executive: “Youforget it’s a relationship.” This is particularly sur-prising given the adamant afrmations of theimportance of the relationship to the organizationby almost every study participant. If, as the nd-ings suggest, the creation of social capital was anunconscious byproduct of a high-trust relation-

ship, it suggests that the potential for social capitalcreation in the study nonprot organizations waseven greater and unrealized.

Relationship building takes time and skil l. Failureto recognize the potential and value of social capitalfor the nonprot organizations they serve, resultsin the investment of board chair and executive’senergies and attention elsewhere. The multiple,competing demands they encounter require pur-poseful, strategic thinking in considering where toinvest for the best social capital return. This studyhighlights that one of the rst places to invest is intheir own relationship.

IMPLICATIONS FOR PRACTICE

Nonprot leaders need to recognize that the boardchair-executive director relationship is an impor-tant and powerful resource that can be leveragedin support of the organization’s mission. Theyneed to promote and engage in dialogue about howto best develop and nurture it. Board chairs and

executives should focus on their relationship, rec-ognizing that building the relationship itself is animportant component of their work together.

Nonprot leaders need to ensure that the impor-tance of this leadership dyad is reected in thepractices of board chair selection, terms of ofce,expectations of executives, and board leadership


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Jodie Butler Markey and Dwight V. Denison , Universityof Kentucky, Martin School of Public Policy andAdministration 1

N onprot boards make major decisions fortheir organization such as setting the mis-sion, strategic planning, budgeting, andhiring an executive director. As a result, boardmembers hold a large portion of the power withinnonprot organizations. On the other hand, impor-tant decisions about the day to day operations ofthe organization are made by executive directors. Itis therefore critical for executive directors and non-prot boards to foster productive relationships inorder for the nonprot organization to accomplishits mission and to ensure that positive decisions aremade for the organization.

The purpose of this paper is to identify some

key factors that promote effective relationshipsbetween the board and the executive director. Toaccomplish our objective, we identify from the lit-erature several important activities relevant to theboard-director relationship. We then analyze thesurvey ndings of executive directors of nonprotorganizations in the Lexington, Kentucky, area todetermine which of the factors are correlated withhealthy and effective director-board relationships.The objectives of our paper can be summarized intwo research questions:

n What makes an effective board-executivedirector relationship?

n Which elements of the organization orboard might be related to the effectivenessof the board-executive director relationship?

1 Jodie Butler Markey can be reached at [email protected] ; andDwight Denison at dwight.denison@uk y.edu

The use of a governing board as a major decision-making body is an integral component of thenonprot sector. While board members are notpaid and often perform the duties of volunteers,they have additional responsibilities that dif-fer from those of a normal volunteer. States havepassed different laws to dene permissible behav-iors for board members, usually including the idea

that board members must act in good faith whenmaking decisions for the organization. For exam-ple, Kentucky law requires that a director (boardmember) “shall discharge his duties as a director,including his duties as a member of a committee:(a) In good faith; (b) On an informed basis; and (c)In a manner he honestly believes to be in the bestinterests of the corporation.” (Kentucky RevisedStatutes 273.215, 1989). Board members can be heldliable for the harmful actions of the organizationand in some situations can even be sued as agents

of the organization (Duca, 1996). Directors andOfcers Insurance can be purchased to nanciallyprotect board members, but appropriate behavioris still a responsibility that board members mustalways demonstrate.

Boards wield tremendous authority as they arefrequently responsible for performing a myriadof duties including setting the mission, strategicplanning, budgeting, and hiring the executivedirector. Since executive directors of nonprotorganizations do not hold the same level of con-centrated power as chief executives in for-protorganizations, they must build a good working rela-tionship with the board to ensure that favorabledecisions are made for the organization. For non-prot executives, Collins (2005) recommends usinglegislative leadership to be respectful of the board’spower while stil l working towards positive decisionsfor the organization. Legislative leadership relies on

Fostering Effective Relationshipsamong Nonprofit Boards and

Executive Directors


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persuasion, political currency, and shared interestsin order to create an environment in which the rightdecisions can be made (Collins, 2005).

WHAT MAKES AN EFFECTIVE BOARD-EXECUTIVEDIRECTOR RELATIONSHIP?

A review of the literature on board-executive direc-tor relationships suggests that four factors areimportant in building a solid relationship betweenthe board and executive director:

n Executive director perceptions of boardengagement in the organization,

n Expectations for the executive director,

n Expectations for the board, andn Board-executive director communication.

Board engagement in the organization

There are several ways boards can be effectivelyengaged in the work of the organization. Vartorellasuggests that boards should be held accountable forfundraising for the organization and that annualgiving comes with the responsibilities of being aboard member (Vartorella, 1997). Research by Wolf

suggests that if board members are not giving backto the organization and are not soliciting funds, thenthe organization could have some problems when itcomes to recruiting outside donors(Wolf, 1999).

Another way to promote boardmember activity is to provide ade-quate orientation for new boardmembers. Orientation may includea number of items ranging fromproviding a board manual to giv-ing out an annual job descriptionfor board members to having a for-mal informational session. Theseorientation activities give new board membersa chance to become familiar with the organiza-tion and the responsibilities of being on the board(Koch, 2003). In fact, Koch contends that orienta-tion and training are “a must” (Koch, 2003).

Regular attendance at meetings is also importantfor board engagement. Reading the minutes of themeeting or participating via electronic means isnot judged to be at the same level of engagementas attendance at the board meetings (Kilmister &Nahkies, 2004).

Expectations for the executive director

In the formal hierarchy of nonprot organizations,executive directors are directly below the board.Having an executive director that is clearly account-able to a functioning board is a situation uniqueto nonprot organizations (Drucker, 1989). As aresult, executive directors should strive to meet the

needs and expectations of the board. According toSwanson, these needs and expectations can includeregularly reporting on the status of the organiza-tion and carrying out the goals and objectives forthe organization set forth by the board. In order tomake informed decisions for the organization, theboard needs to receive regular reports on the statusof the organization (Swanson, 1989). The board canalso outline organizational objectives for its execu-tive director (Swanson, 1989). Even though theboard may be at the top of the organizational chart,

it is important that board members and the execu-tive director see each other as colleagues working toachieve the same goals (Drucker, 1989).

Expectations for the board

According to nonprot duciarystatutes, the board members ofnonprot organizations are gen-erally charged with the duty ofcare, the duty of loyalty, and theduty of obedience (Gibelman,Gelman & Pollack 1997). Theseduties entail acting prudentlywhen making decisions regard-

ing the organization, acting in the best interests ofthe organization instead of the best interests of theboard member, and being obedient to the missionand goals of the organization (Gibelman, Gelman& Pollack 1997). While these legal responsibilities

For nonpro t executives,Collins (2005)recommends usinglegislative leadership to berespectful of the board’spower while still working

towards positive decisionsfor the organization.


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may vary slightly from state to state, these are thebasic legal expectations for board members. How-ever, the executive director will have additionalexpectations of board members in order to help theorganization run smoothly. A major task that theboard must undertake is the evaluation of the exec-utive director’s performance. This task is one of themain responsibilities the board as a whole mustundertake (Iecovich, 2004). This responsibilitygoes hand in hand with the board’s responsibil-ity to hire and potentially re executives. Boardsshould also focus on long-term planning for theirorganizations, as it is their responsibility to set thegoals for their organizations (Carver, 1990). Carveralso asserts that boards should strive to be openand accountable to their stakeholders and theircommunities (Carver 1990). Board members holda great deal of responsibility and their involvementis crucial to the success of the organization.

Board-executive director communication

According to research in this area, clarity of rolesand expectations is critical to having a success-ful board-executive director partnership. Regularcommunication is also an important component

of a successful partnership. It is recommended thatthe executive director and the board president com-municate at least once per week in order to keepthe lines of communication open (Koch, 2003).It is not uncommon for the executive director tospend a large portion of time communicating withboard members outside of meetings. There is nomagic number of hours or minutes that is the bestamount of communication time between executivedirectors and board members. Some boards wantto be actively engaged in many decisions, while

other boards are content to handle the major deci-sions and leave the smaller issues to management.Thus, the board should clarify the decisions onwhich they should be consulted, and which deci-sions the executive director can be responsiblefor (Eadie, 1996). Likewise, the executive directorshould ensure that board members understand theresponsibilities that come with being on the boardof the organization (Weisman, 1995).

RESEARCH METHODOLOGY

A survey was developed and administered to thedirectors of nonprot organizations in Central Ken-tucky to examine the important factors of effectivenonprot board-executive director relationships.The perceptions of the board-director relationshipwere assessed from the viewpoint of the execu-tive directors. There was no attempt to survey theboard members of these organizations. The surveywas administered via a website to sixty executivedirectors from nonprot organizations with paidexecutive directors and located in Lexington, Ken-tucky. Out of the sixty organizations identied inthe sample, thirty-six executive directors responded

to the survey for a 60% response rate.The executive directors were contacted by phoneprior to receiving an e-mail invitation to completethe survey in case they had any questions or con-cerns about the study. This delivery method for thesurvey allowed the executives to complete the sur-vey at the time that best suited them. However, if theexecutive did not have access to the internet, he/shewas offered the opportunity to take the survey overthe phone. A week after initial contact, a reminderwas sent to the organizations that had not yet com-pleted the survey. All participants were guaranteedcondentiality so that no information gathered bythese surveys would come back to harm the execu-tive director or the organization in any way.

Several assessment tools have been developed byresearchers to examine the effectiveness of the boardon the organization as whole. The GovernanceEffectiveness Quick Check is a test that measuresthe effect of board practices on the overall health ofthe organization. This tool was developed by Gill,

Flynn and Reissing (2005) as an abridged version oftheir Governance Self-Assessment Checklist. TheGovernance Self-Assessment Checklist tests 144items and assigns a Governance Quotient to eachorganization that shows the effectiveness of boardgovernance practices. This research determinedthat there was a high correlation between the scoreson the Governance Effectiveness Quick Check andthe Governance Self-Assessment Checklist (Gill,


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Flynn and Reissing, 2005). Oursurvey included questions fromthe Governance EffectivenessQuick Check to gauge the overallperformance of the boards.

The survey consists of twenty-nine close-ended questions andthree open-ended questions. Theclose-ended questions requireda few words for response, a mul-tiple choice answer or an answerbased on a Likert scale. For thesestatements the following Likert scale was used; 1,strongly disagree, 2, disagree, 3, somewhat disagree,

4, somewhat agree, 5, agree, and 6, strongly agree.These statements were designed so that a 6, stronglyagree is the best answer and 1, strongly disagree isthe worst answer. There were three statements wherestrongly disagree was the best answer and stronglyagree was the worst answer, but the statements andanswers to these statements were inverted after thesurvey collection was complete. Fifteen of the ques-tions in the survey were taken directly from othersurvey instruments while seventeen of the questionswere developed based on the literature review.

Organizations were also given an overall score fortheir answers on the Likert scale statements as ameasure of governance effectiveness. The over-all score was tallied by averaging the Likert scaleanswers for each organization based on the 12 fac-tors that Gill, Flynn and Reissing (2005) used tomeasure governance effectiveness in their quickcheck model. The average score can therefore bereferred to as The Index of Governance Effective-ness (IGE). The four components of the IGE withthe highest average rankings (average score inparentheses) are:

n Board meetings are well-managed (i.e.there is a set agenda, time limits areobserved, etc.). (5.47)

n The board’s capacity to govern effectivelyis not impaired by conicts betweenmembers. (5.36)

n I know which decisions canbe made without board con-sultation and which decisionsneed board consultation.(5.22)

n Board members demonstratecommitment to this organi-zation’s mission and values.(5.22)

The following statements receivedthe lowest average rankings fromthe sample:

n The board is actively involved in fundrais-ing efforts for this organization. (3.69)

n The whole board is responsible for a regu-lar evaluation of the executive director/CEO’s performance. (3.69)

n The board outlines measurable goals,objectives and expectations for myperformance. (3.94)

The focus of our study was to identify the factorsthat are more inuential on the governance effec-tiveness as measured by the IGE. Based on previousliterature and studies, we propose four primary fac-tors that are believed to inuence the value of theIGE score: organizational characteristics, executivedirector’s tenure, board activity, and communica-tion. Information on these factors was collected foreach organization through the survey. 2 The specicvariables are now discussed.

The organizational characteristics include size of theboard (Boardsize) and age of the organization (Age).As the number of board members increases there are

2 Here are the questions as presented on the survey. How manypeople are on your organization’s governing board? How long have you been the execut ive director of your organization (in years)?When was your organization established? What percentage of yourboard members make monetary contributions to the organizationat least annually? What is the average attendance rate at yourregularly scheduled board meetings? How many hours

Effective Approach to LMD

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