Before saying ‘yes’ to serving on a board
Thursday, April 24, 2014
My friend was asked to join a board of directors. I could see that he was flattered and considering the invite, but I don't think he knew what questions to ask about serving on a board.
Here's a checklist prospective board members may want to consider, along with the reason for each question in italics:
- May I have a copy of the mission statement? Do I agree with the mission, vision, values and work of the organization?
- Can you provide me with the strategic plan? Is there a roadmap for board and staff or will we wander from issue to issue?
- What is the annual budget and what is set aside is savings? Does the organization have sufficient resources?
- What are the major sources of revenue? Are the dependent on grants or have diverse revenue sources?
- Is there an audit of the funds? Are funds accounted for and audited to protect against diversions?
- Does the board have access to a CPA? If I have questions, can I rely on a financial professional?
- May I have a copy of the Information Return, IRS Form 990? The 990 provides details about the organization, all public record.
- If exempt from federal tax, what is the IRS designation? There are distinctions in foundations, trade associations, etc.
- How frequent — and long — are the meetings? How much time is expected from board volunteers?
- How long is the term of office? Is this a one-, two- or three-year term? How many years do I want to contribute?
- Will there be an orientation of the board and access to information? Will I have the information needed to be a good board member? How much will I have to read?
- Are there added expectations, such as serving on committees, raising funds or political activities? How much extra time will be required?
- Is the board reimbursed for meeting attendance? Will expenses come out of my pocket; can I afford this?
- Is the board covered by directors and officers liability insurance? What about risks and insurance coverage?
- Do the bylaws have an indemnification clause?If I had to defend myself in a case, would the association reimburse me (and have sufficient funds)?
- Is the organization incorporated? If incorporated, there tends to be a corporate veil to avoid attacks on individual directors.
- Does the board have access to an attorney? If I have questions, can I rely on access to legal counsel?
- Is the board required to disclose conflicts of interest? Do I have any conflicts with interests of the organization?
- Are there policies established to guide the board in decision-making? Will I have access to the policies established by prior boards?
- How does the organization avoid any potential violation of antitrust laws? If antitrust violations were to arise is there a measure in place to curtail such activity?
- Are meetings held in person or by conference calls and other means? Will conference calls or webinars be used to supplement regular meetings of the board? Can I attend by conference call if I cannot get to the meeting?
- Is there a board portal to access information and documents? Where do we archive the documents I’ll need to study and be an astute board member?
- Is technology and social media used to enhance communication? Is the website state of the art and software in place to enhance communications?
Board service is rewarding. It is needed to advance the mission and goals of nonprofit organizations. Before saying "yes," ask a few questions about the expectations.
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