Nonprofit Quarterly Winter 2012

Promoting Spirited Nonprofit Management
Winter 2012
$14.95
Special
Governance
Issue
Emerging
Forms of
Nonprofit
Governance
Guo on the Democratic Deficit

in Nonprofit Governance
Cohen on Sarbanes-Oxley
Andersson on Next Questions
Critical Conversations
on the Future of
Nonprofit Governance
A Conference for Practitioners and Researchers
April 45, 2013, Kansas City, Missouri, U.S.A.
The Midwest Center for

Nonprofit Leadership and
The Nonprofit Quarterly, in
collaboration with the Alliance
for Nonprofit Management,
are pleased to announce
and invite you to attend our
2013 Nonprofit Governance
Conference.Over the last
decade we have witnessed
many events and changes
that have affected the pace
and scope of the nonprofit
sector.This years conference
themeCritical Conversations
on the Future of Nonprofit
Governancereflects the
growing interest we observe
in various governance related
issues across the globe and
challenges practitioners
and researchers to consider
from multiple perspectives
the emerging shape of
governance and the future
of board work.
PRESENTED BY
The Midwest Center for Nonprofit Leadership

University of MissouriKansas City
The Nonprofit Quarterly
CO-SPONSORED BY
The Alliance for Nonprofit Management

AMONG THE KEY TOPICS WE EXPECT
TO EXPLORE AT THIS YEARS CONFERENCE:
Advances of Information Technology and Governance

Networks, Hybrid Structures, and Innovations in Governance
Social Entrepreneurship and Governance
Nonprofit and Public Sector Governance
Power, Influence, and Inclusion
The Future of Research on Nonprofit Boards and Governance
ABOUT THE CONFERENCE
The conference begins on Thursday morning, April 4, 2013, and

runs through mid-afternoon, April 5. A pre-conference program
runs the afternoon of April 3. Conference and lodging are at
the Embassy Suites Country Club Plaza in Kansas City, Missouri.
Registration for the conference will open January 2013, and can
be completed via mail or online, at mcnl.org. Questions about the
conference can be directed to conference co-directors David Renz
(RenzD@umkc.edu) and Brent Never (NeverB@umkc.edu).
Volume 19, Issue 4
Winter 2012
Features
3 Welcome to Emerging Forms of
32 Adding a Few More Pieces to the

Puzzle: Exploring the Practical
Implications of Recent Research
on Boards
6 Problem Boards or Board Problem?

How can we make board work more
What is it that enables boards to be strong
meaningful for serving members and more
and effective, and why are we still using
consequential for their organizations?
outdated models in an effort to improve
by William P. Ryan, Richard P. Chait, and

Barbara E. Taylor
Page 6
14 Underestimating the Power of

board performance?
by David O. Renz, PhD
40 Financial Transactions with Your

Board: Who Is Looking?
This article proposes that nonprofit
In a first-of-its-kind study, nonprofits
leaders are increasingly focused on
report on their transactions with board
secondary issues, and asks, What does
memberssome for the better and some
the sector stand to gain as a result of
for the worse.
retraining our focus from structural
by Francie Ostrower, PhD
concerns to the central questions and

principles of nonprofit governance?
46 Sarbanes-Oxley: Ten Years Later
by Ruth McCambridge
A decade since the Sarbanes-Oxley Act

Page 40
20 Reframing Governance II
first appeared, organizations still worry

that aspects of the law will continue to
The most substantive decisions on your
seep into the sector. But doesnt the sector
organizations governance are likely
actually have little to worry about and
happening far from the board room. How
much to gain?
should your governance systems respond?
by Rick Cohen
26 The Road Less Traveled: Establishing

the Link between Nonprofit
Governance and Democracy
How, the author rhetorically asks, can
an organization contribute to a democratic
society if there is a democratic deficit in
its own governance?
Page 46
by Chao Guo, PhD

C O V E R D E S I G N B Y K AT E C A N F I E L D
C O V E R P H O T O G R A P H : E M E R G E N T C U LT U R E
C O V E R / I N T E R I O R A R T B Y S K I P H U N T; S E E P. 5 F O R B I O
50 The Inclusive Nonprofit Boardroom:

Leveraging the Transformative
Potential of Diversity
74 Loyal Opposition
A board that can adopt this parliamentary
concept can benefit from internal
Diversity on boards has to be good,
scrutiny and creativity that will ultimately
right? So how is it that study after study
strengthen its ability to achieve its
suggests the opposite? A closer look at
mission.
boards today reveals that exactly how we
by Patricia Bradshaw, PhD, and Peter Jackson, CA
diversify makes all the difference.
by Patricia Bradshaw, PhD, and Christopher

Fredette, PhD
Page 50
78 Board Stories Involving Humans

Whether by the book or ad-hoc, the
defining feature of successful boards is
58 Unstill Waters: The Fluid Role of

Networks in Social Movements
not the model but the people who make it

work.
Its a wonder that social-movement
by Ruth McCambridge
networks survive long enough to make an

impact. Whats the secret sauce of these
86 The Best and Worst of Board Chairs
organizing efforts?
Do you know one when you see one?
by Robin Katcher
Initial research shows that there is a great
64 Community-Engagement
Governance: Systems-Wide
Governance in Action
Does governance only reside in the board?
Most of us know that it is more widely
held than that, but few really design their
governance systems to make full use
of the intelligence and energies of their
stakeholders.
by Judy Freiwirth, PsyD
deal of agreement about what makes a

good board chair.
Page 86
by Yvonne D. Harrison and Vic Murray
92 New Frontiers and Critical

Questions: Moving Governance
Research Forward
Several insights into the world of nonprofit
governance have emerged in recent years,
yet much remains to be explored. This
article discusses five areas for future
inquiry.
by Fredrik O. Andersson
www.npqmag.org
The Nonprofit Quarterly is published by Nonprofit Information Networking Association,
112 Water St., Ste.400, Boston, MA 02109; 617-227-4624.
Copyright 2012. No part of this publication may be reprinted without permission.
ISSN 1934-6050
Nonprofit Information Networking Association

Ruth McCambridge, Executive Director
Nonprofit Information Networking Association Board of Directors
Ivye Allen, Foundation for the Mid South
Charles Bell, Consumers Union
Jeanne Bell, CompassPoint Nonprofit Services
Lisa Chapnick, Jobs for the Future
Buzz Schmidt, GuideStar International
Richard Shaw, Youth Villages
Welcome to Emerging Forms

of Nonprofit Governance
Winter 2012
This edition of the Nonprofit Quarterly

focuses on the moving target of nonprofit
governance. The target is moving not only
because ideas and practices in governance are shifting more generally but also because many nonprofits
concerned. This has led to an overdependence on pre-
Emerging
Forms of
Nonprofit
Governance
Volume 19, Issue 4
have, frankly, been lazy thinkers where governance is
$14.95
Special
Governance
Issue
ear readers,
Emerging Forms of Nonprofit Governance
Editorial Advisory Board

Jeanne Bell, CompassPoint Nonprofit Services
Robyn Blackwell, United Way of Acadiana
Kebo Drew, Queer Women of Color Media Arts Project
Anne Eigeman, Anne Eigeman Consulting
Kevin Gilnack, Massachusetts Providers Council
Michael Jackson, St. Vincents House
Kathi Jaworski, Nonprofit Association of Oregon and
Write to Know Nonprofit Consulting
Valerie Jones, Community Thread
Nancy Knoche, Consultant
Lisa Maruyama, Hawaii Alliance of Nonprofit Organizations
Robert Ottenhoff, GuideStar
Karen Parsons, PAARC
Lonnie Powers, Massachusetts Legal Assistance Corporation
Jon Pratt, Minnesota Council of Nonprofits
Dolores Roybal, Con Alma Health Foundation
Paco Wertin, Christian Foundation for Children and Aging
Tammy Zonker, Fundraising Transformed
Wi nte r 2012
Editor in Chief
Ruth McCambridge
Publisher
Kristin Barrali
National Correspondent
Rick Cohen
Managing Editor
Cassandra Heliczer
Contributing Editors
Kate Barr, Jeanne Bell, Jon Pratt, Lissette Rodriguez
Senior Online Editor
Mike Keefe-Feldman
Web and Communications Associate
Aine Creedon
Graphic Design
Kate Canfield
Production
Matt Mayerchak
Administrative Coordinator/Customer Service
Megan Sampson
Copy Editor
Proofreader
Elizabeth Smith
James Carroll
Guo on the Democratic Deficit

in Nonprofit Governance
Cohen on Sarbanes-Oxley
Andersson on Next Questions
scriptive norms, a general lack of attention to research,

and a dearth of real creativity aimed at a powerful endgame. In recognition of this
intellectual logjam, for ten years NPQ has collaborated with the Midwest Center for
Nonprofit Leadership to sponsor a conference that brings academics and practitioners together. The conferences mission is to discuss the theoretical frameworks in
relation to the realities of nonprofit governance and the questions we see as needing
further exploration. This special edition of NPQ reflects for the most part a combination of papers delivered and ideas explored at the conference over the last decade. It
is in no way definitive but rather a stop along the way to refining governance practices
to make nonprofits even more powerful and effective than they are now.
Why Wont My Board Fundraise? Im Dizzy! Why Wont the World Stop Turning?
Here is a thought: maybe for most nonprofits the board will not, after all, be your fund
raisersbut your governance system will! And, just in case you dont get the point,
we are talking less about getting your board to fundraise than about entreating you
to consider transforming your nonprofit governance system so that it actively honors,
informs, supports, amplifies, vivifies, and expands the work of the organization. The
work of governance includesbut is hardly limited tofundraising. And, arguably,
if you do not use the governance system writ large in ways that demonstrate that you
value your community of stakeholders for things other than their cash, they may be
less likely to fund youor recommend you for funding by others.
The Definition of Insanity: Trying to Fire Up the Edsel

It has been the case for many decades now that when you ask people in the nonprofit
sector about their major issues with their boards, the response is an embittered collective whine about the unwillingness of board members to take on fundraising for
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the organization. Some organizations, do, of course, have one of those boardsfilled
with billionaire hedge fund managers willing to make use of their financial and social
capital on behalf of the organization. But this is generally not what most of our boards
look and act like. In fact, Francie Ostrowers groundbreaking study, based on a survey
of board practices (see page 40 of this issue), found that only 29 percent of boards are
active in fundraising. That doesnt stop us from trying to re-create our board in the
revered image of symphonies or the Harlem Childrens Zone. We keep expecting this
TO S U B S C R I B E , P L E A S E V I S I T: H T T P:// S TO R E . N O N P R O F I TQ U A R T E R LY. O R G /
T H E N O N P R O F I T Q U A R T E R LY 3
old car to start, when it was an Edselat
fewer influential members than did the
keep people attached to themenergy
least for most of usto begin with.
donative organizations, but both groups
and treasure and allthey must ensure
increased the prestige of board members
they are listening and responding to, and
at approximately the same rates:
even providing common space for, those
It is not entirely the fault of practitioners, who have been trying for years to
tinker here and there in hopes that the
Contrary to what we expected, those
people who feel that they have an inter-
vehicle will finally spark up and get on
nonprofits with no or only small increases
est in the organization to talk with one
the highway, somehow becoming fully
in board prestige had, on average, more
another. This large pool of advice and
capable of negotiating the passing lane;
gain in total revenue ... For the total
energy and cash does not replace other
they have been assured by salespeople
sample of forty-four community-based
governance or fundraising approaches,
that it will easily do at least a reason-
organizations, those with large increases
but it adds to and changes them. It
able sixty-five miles per hour if they just
in prestige averaged total revenue
increases our power and accountability
keep at it. These salespeople include
increases of a little more than $642,000;
all at once.
governance consultants, whose business
those with no or small increases aver-
Again, as we said at the beginning of
model is based on a set of antiquated
aged gains of a little more than $941,000.
this article, boards and governance are
formulas, some of which flat-out do not
The same held when we sorted the orga-
not the same thing. Boards play a part in
work for many nonprofits.
nizations into donative and commer-
your system of governance, but they are
Here is one of those formulas:
cial nonprofit organizations. Among
not the be-all and end-all by far. Many are
People with connections to money
the donative organizations, the average
in charge of telling nonprofit leaders what
on your board = a healthier budget.
gains for the no/small increase in board
to do: regulators, funders, your commu-
Of course, you are told, you have to
prestige were almost $912,000 and a little
nity of beneficiarieseven their friends
work the whole system rightand
more than $780,000 for those with large
and families. Thanks to the wonders of
that, it seems, is where it all falls
increases in board prestige; the respec-
the Internet, we can see even the most
apart ... or is it?
tive gains for the commercial nonprofits
distributed and uncoordinated parts of
In 2003, Bill Ryan, Richard Chait,
were $1,010,000 and $469,000. Clearly,
this governance system fire up publicly
and Barbara Taylor wrote an article for
increasing board prestige was not instru-
and pretty quickly now when an organi-
NPQ titled Problem Boards or Board
mental in improving an organizations
zation makes a decision that some group
Problem?, in which the authors sug-
financial outcomes.
of stakeholders disapproves of (e.g.,
gested that if the current structures and
So, the advice sounds rational, but fol-
Susan G. Komen) or when an organiza-
concept of the board are not working for
lowing it simply does not work for some
tion is perceived as needing protection or
so very many, perhaps it is less about a
types of organizations, and, in fact, has
support ( la Planned Parenthood).
mass generalized dysfunction than about
an adverse effect even on just the budget.
And, in fact, this more disparate and
the fact that the basic precepts under-
We printed the above a decade ago, but
uncoordinated system may be able to
writing the governance systems of non-
probably every twenty-two seconds
move much more quickly in some cases
profits are not accurate with respect to
or so a poor nonprofit somewhere is
than institutional partners canpart-
what we want them do.
being given the advice about recruiting
ners whom you may see as being more
There are some real indicators that
for prestige. As Ryan recently joked,
powerful (for instance, major funders
the latter may be the case. David Renz
the nonprofit governance industrial
and policy-makers). These kinds of
and Robert Herman surveyed sixty-four
complex is no small force.
partnersespecially the policy-mak-
human service organizations in 1993,
ersare traditionally influenced by the

fourth estate (the press). But more and
its were sorted into two groups: those
Beam Us Up, ScottyWe Need to

Rethink the Vehicle
more dependent on earned income
While many boards are still trying to
people have more capacity to publish
(commercial organizations) and those
get on the highway, others have engi-
themselveswhether it be in tweets
more dependent on contributed income
neered ships built for and fueled by close
or posts on an organizations website
(donative organizations). When the
encounters with constituents. Okay, we
policy-makers are becoming more sensi-
authors examined the relative levels of
know we are mixing our popular meta-
tive to the groundswells of public voice.
prestige of their boards, they found that
phors, but a growing number of organi-
And we are likely seeing just the tip of
the commercial organizations began with
zations have realized that if they want to
the iceberg.
and then again in 1999. The nonprof-
4 T H E N O N P R O F I T Q U A R T E R LY
more, as the media industry changes and
W W W. N P Q M A G . O R G W I N T E R 2012
In Reframing Governance II (also in
for civil society in that there seems to be
stakeholder involvement and new, more
this issue), Renz surfaces the undeniable
renewed interest in public deliberation
direct forms of citizen engagement, is
reality that, at levels where decisions
and collective action. At the same time
there a transformed notion of political
about funding and policy get made, much
perhaps driving this renewed inter-
representation emerging? Can more
of the generative work of governance for
estinformation and communication
groups, people and styles of activity
government-funded nonprofits has been
technology has begun to unleash new
count as representative and, if so, what
done outside of any one agencys board
possibilities for democratic governance.
does this mean for the way in which we
room. He suggests that we should all
Social media are equipping organizations
understand the term and more broadly
be paying more attention to how these
with the opportunity to instantly commu-
for the legitimating role that representa-
realms are influenced through networks.
nicate with a broader range and new gen-
tion plays in democracy? He goes on to
Robin Katcher takes up the issue of net-
eration of constituents and engage them
note, processes of governance seep into
works and the way they are governed in
in joint action. Nonprofit governance is
a wider array of contexts and embrace a
Unstill Waters: The Fluid Role of Net-
no longer limited to the boardroom; it
wider array of actors. We are not dealing
works in Social Movements.
is reaching out to people, partners, and
here with a simple transfer of represen-
Groups developed in a more modern
communities like never before. Guo
tative politics from one type or domain
image have structured in a broader system
concludes: In the dawn of a participa-
to another, but rather a significant shift in
of governance that connects with partici-
tory revolution characterized by the
the primary political sense of representa-
pation in the work of the organization and
power of the Internet and social media,
tion as a practice and concept.2
supporting the organization financially.
an organization that fails to recognize
Over the years, the governance
Will a larger network that directs with a
and address the democratic deficit in its
research conference has more strongly
smaller group (board), ensuring the integ-
governance will be left behind.
focused on ideas about networked gov-
rity of systems, be the new standard form
The following excerptfrom a
ernancebut the strength with which
of organizations as we progress forward?
chapter by Michael Saward called Gov-
society is re-forming assumptions about
It is anyones guess.
ernance and the Transformation of
governance is surging ahead of most non-
Thus, while we have been sitting
Political Representation, in Remaking
profit practice. We need to find more well-
in our insulated board rooms discuss-
Governance: Peoples, Politics and the
conceived and up-to-date constructs.
ing what has made it onto the agenda,
Public Sphereprovides a sense of the
there may be much larger agenda items
larger context for our discussions:
N otes
brewing for us elsewhere; prime among
The shifts in styles of governance
1. Robert D. Herman and David O. Renz,
them would be the use of our natural
from state-centric and more formal
Do Big Names Really Draw Big Bucks?
resources (our constituency and stake-
modes to plural and often informal
The Nonprofit Quarterly 13, no. 2 (summer
holder bases) when it comes to wielding
modes of engagement with citizens at
2006): 18.
power and influence.
local, national and supranational levels
2. Michael Saward, Governance and the
In this issue, Chao Guo discusses the
raise important new questions about
Transformation of Political Representation,
difference between a representational
the scope and legitimacy of traditional
in Remaking Governance: Peoples, Politics
approach to governance and a participa-
notions of political representation. In the
and the Public Sphere, ed. Janet Newman
tory approach: This is an exciting time
spaces of publicprivate partnerships,
(Bristol, UK: The Policy Press, 2005), 17996.
The art for this special edition on nonprofit governance was contributed
by Skip Hunt. Skip picked up a 35mm camera in the mid-1970s; bitten hard by the wanderlust beast, he
has been canvassing the globe ever since, sharing his unique vision via photographic images. Skips insatiable thirst
for rich color and even richer cultural exploration keeps him on the road most of the time. Of his art, he has said,
I am beginning to believe that we are all born asleep and that the rest of our lives are spent trying to awaken.
Image making reminds me to rise from that slumber and celebrate lifes rich pageantry. When hes recharging his
batteries, Skip calls Austin, Texas home. More of Skips work can be viewed at kaleidoscopeofcolor.com.
governance
Problem Boards or
Board Problem?
by William P. Ryan, Richard P. Chait, and Barbara E. Taylor
The authors suggest

that much of the
Editors note: This article was first published in
current investment in
NPQs summer 2003 edition.
addressing problems
of performance
might be better
he past twenty years have seen the steady
growth of training programs, consulting practices, academic research, and

guidebooks aimed at improving the per-
formance of nonprofit boards. This development
spent on examining
reflects both hopes and doubts about the nonprofit board. On the one hand, boards are touted
issues related to
as a decisive force for ensuring the accountability
better defining
of nonprofit organizations. On the other hand,
purpose.
institution. And its not just the occasional non-
the board is widely regarded as a problematic

profit financial implosion or scandal thats troubling. All institutions, after all, have their failures.
Perhaps more worrisome is the widespread sense
W illiam P. R yan is a consultant to nonprofit organizations and a research fellow at the Hauser Center for Nonprofit Organizations at Harvard University. R ichard P.
C hait is a professor at the Graduate School of Education,
Harvard University. B arbara E. T aylor is a governance
consultant and senior consultant with Academic Search
Consultation Service. They are co-authors of Governance
as Leadership: Reframing the Work of Nonprofit Boards
(John Wiley & Sons, 2005).
P H OTO G R A P H : F I R E PA I L S
that underperforming boards are the norm, not
of an official job description for the board. The
the exception.
vast, prescriptive literature can fairly be distilled
After contributing to these board-improvement

efforts for over two decades, as both researchers
What if the central

problem plaguing boards
is not ignorance about
important roles and
and consultants, we have recently looked afresh

at the challenge of improving nonprofit boards
as part of the Governance Futures project. Conceived by BoardSource (formerly the National
Center for Nonprofit Boards), in collaboration
with the Hauser Center for Nonprofit Organiza-
into five functions:

1. Set the organizations mission and overall
strategy, and modify both as needed.
2. Monitor management, and hold it accountable for performance.
3. Select, evaluate, support, and, if necessary,
replace the executive director or CEO.
4. Develop and conserve the organizations
responsibilities but lack
tions at Harvard University, the project seeks to re-
of a compelling purpose
conceptualize governance. Although it ultimately
5. Serve as a bridge and buffer between the
intends to generate new and practical design strat-
organization and its environment, advocat-
egies, we have focused first on the problems of the
ing for the organization and building support
in the first place?
boardon the theory that a better framing of the
resourcesboth funds and property.
in its wider community.
problem will lead to better responses. Through
The roles-and-responsibilities conception
dialogue with practitioners, a review of the litera-
of board performance has obvious appeal.
ture on nonprofit governance, and the application
With a problem defined as ignorance, the solu-
of various intellectual frameworks (from organi-
tion becomes knowledge. And since we already
zational behavior to sociology), we have begun to
possessin the form of official job descriptions
see the cottage industry of board improvement in
the knowledge that boards need, we need only
a new light. Most importantly, we have concluded
disseminate that knowledge to unenlightened
that we have been working on the wrong problem.
trustees to cure the problem. The expectation is

that we can train our way out of board problems.
Problems of Performance
Behind these problems of performance,
The problem with boards has largely been under-
however, looms another, more fundamental
stood as a problem of performance. Judging
problem: one of purpose.
from our recent discussions and interviews with
Some advocates of a roles-and-responsibil-
board members, executives, and consultants,
ities approach inadvertently acknowledge this
three board-performance problems appear most
problem when they reason that, since the board
prevalent. First, dysfunctional group dynamics
endures as an institution, it must be important.
rivalries, domination of the many by the few, bad
The widespread existence of boards, writes
communication, and bad chemistryimpede col-
Cyril Houle, means that they must possess values
lective deliberation and decision making. Second,
which are apparently essential to modern life. It
too many board members are disengaged. They
will therefore be useful to assess the reasons why
dont know whats going on in the organization,
boards are important.1 The very formulation of
nor do they demonstrate much desire to find
this approachor variations common in the lit-
out. Third, and most important, board members
eraturebetrays a fundamental problem. If the
are often uncertain of their roles and responsi-
board is so important, why do we need a whole
bilities. They cant perform well because they
literature to explain why this is so? This ques-
dont know what their job is. When we spoke
tion raises another: What if the central problem
with twenty-eight nonprofit governance consul-
plaguing boards is not ignorance about important
tants about their recent engagements with trou-
roles and responsibilities but lack of a compelling
bled boards, nineteen characterized the clients
purpose in the first place?
problem as ignorance or confusion about roles

and responsibilities.
Problems of Purpose
Scores of analysts have addressed this problem
We can approach the problem of purpose in two
and, in response, offered one version or another
ways. We can attempt to expose the board as an
irrelevant institution constructed around a set of
more than promote success.
hollow roles and responsibilities. Or, as we prefer,
This approach places board members in a
we can ask whether the purposes now ascribed
position akin to that of the maligned substitute
to boards might be necessary, but insufficient, to
teacher. As an institution,the substitute teacher
sustain engaged and effective service by nonprofit
works effectively. The device assures school
board members. Even this approach, however,
administrators and parents that children who
requires some reflection on the problem of
might otherwise run amok will remain under
purpose. We start with three causes of the problem.
control. But the job of the substitute teacher is
The Substitutes Dilemma: The Most Essen-
singularly unattractive. Adherence to minimum
tial Work Can Be the Least Meaningful. By law,
standardsnot trying to teach but merely trying
accountable to the
the boards fundamental purpose is to hold a non-
to keep orderis as or more challenging than
profit accountable to the broader community. The
actually teaching. It is also far less rewarding. So it
broader community.
law offers little guidance, however, on how boards
is with board members. What we have essentially
The law offers little
should do sobeyond referring to broadly con-
asked is that trustees keep order.
guidance, however, on
ceived duties of loyalty and care. The standard
Why not concede that boards do unglamorous
statements of roles and responsibilities offered to
but essential work and get on with it? The reason
board members attempt to add flesh to this legal
lies again in the paradox of substitute teaching.
skeleton. But a job predicated on legal account-
The teacher who educates children actually stands
ability is, almost by definition, not a compelling
a better chance of keeping order than the teacher
job. To ensure this accountability, boards focus
required only to keep order. Similarly, the board
on norms and standards of minimally acceptable
that is expected to improve organizational per-
behavior. Trustees are tasked to prevent trouble
formance also stands a better chance of ensuring
By law, the boards

fundamental purpose
is to hold a nonprofit
how boards should do so.
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By focusing primarily on
accountability, we have
created a job without a
compelling purpose. As
accountability. By focusing primarily on account-
say, The board keeps me on my toes or I can
ability, we have created a job without a compel-
feel the board looking over my shoulder. Henry
ling purpose. As a result, board members become
Mintzberg, a strategy theorist, likened the corpo-
disengaged. And the more disengaged they are,
rate board to a bumblebee that buzzes around the
the less likely trustees are to ensure accountabil-
head of the CEO. Ever mindful of the possibility
itythe very reason we created boards in the first
of being stung, the CEO remains vigilant. As that
place. By asking for a little, we get even less.
image suggests, even random, annoying activ-
The Monarchs Challenge: Important Work

Is Sometimes Institutional, Not Individual.
ity can be sufficient to keep managers alert. The

flurry of activity alone has important effects.3
The problem is not that the board is some point-
Parsing these individual and institutional
a result, board members
less appendage that renders board members
roles, we return to the legal role of the board as
become disengaged.
inconsequential. To the contrary, the board, as
an accountability agent. We can construe societys
an institution, is so important and effective that
mandate to the board as an active one: ensure
it can sometimes function almost without regard
accountability. But its also true that the wider
to the effort of individual board members. In that
societys interests are satisfied to a large extent by
sense, a board may be more like a hearttoo vital
the mere existence of the board, which serves as
to rely on conscious effort to perform. Consider
a legally answerable entity in the event of wrong-
four cases where the board can perform well and
doing by the organization. The board assumes
thus leave board members little to do.
the ultimate legal responsibility. We hope that
First, boards provide legitimacy for their
responsibility leads the board to due diligence,
organizations. Unlike the business sector, where
but nothing in the law can compel the board to
stakeholders can judge a corporation by financial
also be high-performing.
performance, the prospective funders, clients, and
As trustees attempt to define the purpose of
employees of the nonprofit sector often rely on
a body that in some ways requires little of them,
signals and proxiesnone more compelling than
they face something of the predicament of a
the presence of a distinguished boardto assess
monarch in a modern, democratically governed
an organizations efficacy. But beyond lending
state. Its the institution of the monarchynot
their names to the organizations letterhead, and
the individual monarchthat does much of the
occasionally attending a public function or offi-
work. The monarchy helps to create a national
cial event associated with the organization, board
identity, reassuring and unifying the country
members need not do anything to create legiti-
(especially in times of crisis), marking important
macy. They merely confer it.
events through ceremony, and, not least, devel-
Similarly, the board provides managers with
oping the tourism economy. Some monarchs are
what organizational theorists call sense-making
more likeable than others, but most purposes of
opportunities simply by meeting, writes Karl
the institutional monarchy can be fulfilled regard-
Weick.2 The mere prospect of a board meeting
less of the individual monarchs capabilities or
where little or nothing may actually happen
personality. For a monarch, the solution to this
requires managers to prepare written and oral
problem of purpose is to respect the official job
reports that make sense of organizational events,
description, however limited, and then to invent
challenges, and data. Management must be able
an unofficial job description in order to use the
to communicate to the board an integrated and
position to advance causes close to the monarchs
sensible account that describes and interprets
heart. Board members face the same challenge.
the organizations situation. Presumably, a more
If they rely on the institution of the board to
curious or inquisitive board will compel managers
generate meaningful work, they are likely to be
to be better sense-makers, but the mere occasion
disappointed.
of board meetings goes a long way by itself.
The Firefighters Down Time: Important
The board, as an entity, also encourages vigi-
Work Is Episodic. Sometimes boards resemble
lance by managers. Nonprofit executives often
neither substitute teachers nor modern monarchs.
Sometimes boards are personally engaged in
even contrived work that comes in the intervals,
important work where the trustees performance
the important work becomes devalued. Encour-
proves decisive. Under these circumstances, such
aged to go through the motions, board members
as hiring a CEO, considering a merger, decid-
are frequently driven to ask the ultimate question
ing whether to expand or eliminate programs,
of purpose: Why am I here?
When the important
or dealing with a financial crisis or personnel
Boards once filled down time by taking a
scandal, boards are called on to be diligent and
direct role in managing the organization. But the
purposeful. But in times of calm, when there is
rise of professional nonprofit management has dis-
no one to hire or fire, no strategic choice to make,
couragedthough not eliminated that practice.
and no crisis to manage, then what is the boards
With the widespread acceptance of the official job
undifferentiated from
purpose?
description for boards, such hands-on work now
the mundane or even
work that boards

sometimes do remains
We tend to take little account of the fact that
constitutes meddling or micromanaginga
important board work can be highly episodic.
breach of the staff-board boundary. The modern
contrived work that
Board members meet at regularly prescribed
consensus is that nonprofit organizations do not
intervals, even when there is no urgent work to
need boards to manage operations. But does it
comes in the intervals,
do. If boards are to be strategy-makers, as many
follow that nonprofits need boards to govern
governance gurus advise, can management real-
every time they convene, even when there are no
istically devise an agenda replete with important
strategic imperatives to decide?
bet the company questions at every meeting?
In most fields where important work is epi-
In response to this demand for strategic content,
sodic, practitioners do not insist otherwise. A
staff may begin to inflate routine issues into ques-
firefighting company, for example, spends only
tions of strategy. Board members and staff alike
a small fraction of its time actually fighting fires.
soon begin to equate meeting with governing. And
Some time is devoted to training; some is used to
when the important work that boards sometimes
maintain equipment; some is spent on fire preven-
do remains undifferentiated from the mundane or
tion; and some is simply spent waitingcooking,
the important work

becomes devalued.
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Years
eating, watching television, and informally
cant train our way out of problems of purpose,
strengthening the camaraderie of the group.
then what?
Instead of making the preposterous claim that a
If boards approached
fire company is always fighting fires, fire depart-
Problems of Reform
ments put down time to good use.
In recent years, the field of nonprofit governance
What do boards do with their down time?
has approached the challenge of board improve-
In practice, of course, we know that boards do
ment by continually trying to narrow the scope
more than govern in formal board meetings. For
of the proper work for boards to a set of canoni-
example, we asked board members to think about
cal responsibilities. Given the persistent dissat-
a no-board scenario by posing the following
isfaction with board performance, perhaps this
absence of a perpetually
question: What would be the single gravest con-
approach should be reconsidered. We can start
strategic agenda, they
sequence to your organization if the board did not
with three questions. Why have we felt compelled
meet or conduct board business in any way for a
to narrow board work to certain prescribed func-
might, in fact, become
two-year period? In response, board members said
tions? Have we trimmed board service to the right
the organization would suffer the loss of fundrais-
set of essentials? And does the official job descrip-
more valuable assets to
ing capacity, loss of good advice or expertise, and
tion really advance better governance?
the question of how to

use down time explicitly,
rather than lament the
their organizations.
loss of contacts in the community. Though these
The official job description undoubtedly
assets certainly help nonprofits, and may improve
represents an earnest effort to improve gover-
organizational performance, they are not govern-
nance by focusing boards on the fundamentals.
ing per se, and they are not always developed or
But it also solves another pressing need: how to
delivered during formal meetings. They are down-
divide organizational labor between nonprofit
time activities that boards pursue when they are
board members and an ever more professional-
not called upon to govern. If boards approached
ized nonprofit management. After all, the rise of
the question of how to use down time explicitly,
professional management, rather than a sudden
rather than lament the absence of a perpetually
decline in trustee knowledge and intelligence,
strategic agenda, they might, in fact, become more
may best explain why board members have
valuable assets to their organizations.
become increasingly uncertain about their roles.
Specifically, board members might tackle the
In a word, they have been displaced. As Harold
question of what constitutes effective preparation
Wilensky argues in a seminal analysis, the rise of
or readiness to govern. In lieu of formal board
new professions typically involves hard competi-
training events at long intervals, boards could con-
tion, in which a would-be profession sloughs off
strue learning about their communities or con-
dirty work on nearby occupations.4 Doctors gave
stituencies as vital, continuous preparation for
unpleasant tasks to nurses, who shifted them off
governing. Instead of merely recruiting members
to nursing aides, where they will remain until the
who appear to be well informed, organizations
emergence of a nurses aide profession. Faculty
could use their meetings to promote learning by
offloaded admissions and advising on a new cadre
all board members. Board members could con-
of student personnel administrators. Though not
struct and pursue a learning agenda through field
as ungracious as sloughing off dirty work, profes-
work, meetings with other boards, or extended
sional nonprofit management has gently kicked
interaction with constituents. By learning as a
the boards upstairsconfining them as much as
board, the board would have a deeper and shared
possible to policy and strategy (even though there
body of knowledge available when the time comes
is little evidence that boards are as influential as
for important decisions.
managers in the policy-and-strategy spheres).
If board members are not simply uninformed
Many board members have trouble staying
about their roles and responsibilities but are strug-
there, and when they cross the boundary into
gling to find meaningful work in an institution
management territory, many executives and
beset by problems of purpose, then what kind of
consultants are quick to condemn them as either
board-improvement strategies do we need? If we
woefully ignorant or downright mischievous.
Whatever the reason, when boards so misbe-
and a dollop of strategy added up to better gov-
have, managers proffer the official job descrip-
erned organizations, then why quibble? But given
tion as guidance, or wave it like a restraining
the frustrations of many board members and a
order. But in reality, its hard to discern the line
pervasive sense among trusteesand those trying
that divides policy and strategy from adminis-
to help themthat their time and talent (and ulti-
tration and operations. How can we be sure an
mately their treasure) are vastly underutilized, it is
operational matter is not of sufficient significance
time to revisit our assumptions about what boards
to warrant the boards attention? It doesnt help
do and should do.
A new sense of the

problem of purpose
may be more useful
to assert that governors should not manage when
Rather than narrowing our sense of the boards
the difference between management and gover-
work, we should try to broaden it. In fact, in devel-
than still more solutions
nance is not crystal clear. Its also hard to govern
oping managers or leaders, we do precisely this.
at arms length from the organization and without
We urge them to look beyond their narrow, official
to the problem of
first-hand knowledge of the business. How can
job descriptions to the more subtle, important,
performance. The right
a board develop strategy without direct contact
and personally satisfying aspects of their jobs.
with the operational realities of the organiza-
We might try the same for boards, asking how
solution to the wrong
tionwhich is precisely where new strategies
we can make board work more meaningful for
and ideas often emerge and are invariably vali-
board members and more consequential for their
dated or discredited? How can a board evaluate
organizations. For those who want answers now,
the performance of an organization without some
this may entail entirely too much thrashing about
direct knowledge of the enterprise?
the problem. But a new sense of the problem of
The official job description does provide some
purpose may be more useful than still more solu-
opportunities for more active, hands-on work.
tions to the problem of performance. The right
Board members are often expected to represent
solution to the wrong problem rarely works.
problem rarely works.
the board to various social, civic, or professional

networks, and to help the organization understand
N otes
the larger environment better by bringing informa-
1. Cyril O. Houle, The Effective Board (New York:
tion from those networks into the board room.
Association Press, 1960), 8.
And boards have been granted, if not mandated,
2. Karl Weick, Sensemaking in Organizations (Thou-
an enormous role in fundraising.
sand Oaks, CA: Sage Publications, 1995).
Why do these functions make the short list of
3. Henry Mintzberg, Power In and Around Organiza-
essentials? True, the organization needs help in
tions (Englewood Cliffs, NJ: Prentice-Hall, 1983), 76.
these areas, board members are good at these
4. Harold L. Wilensky, The Professionalization of
tasks, and trustees are often willing to perform
Everyone? The American Journal of Sociology 70,
them. But board members are not uniquely quali-
no. 2 (September 1964): 13758.
fied for this work. Indeed, management could

and does work on both funding and commu-
To comment on this article, write to us at feedback@
nity support. But, in truth, these functions have
npqmag.org. Order reprints from http://store.nonprofit
one important characteristic: they keep board
quarterly.org, using code 190401.
members busy outside the organization, where

they are not apt to interfere with the work of managers and staff. In other words, the official job
description doesnt insist that boards only govern,
but the list improves the odds that trustees will
not get in the way of managers.
If we were satisfied with the performance of
boards, the fact that the official job description
is not entirely, conceptually coherent wouldnt
matter. If a pinch of policy, a heap of fundraising,
Nonprofits must make sure to

continually keep an eye on the
larger social context of our
work. If we accept that the
nonprofit sectors primary role
is to enable all to have a voice
in the creation of our future,
this will open the door to the
true potential of governance
and bring us back to the power
and influence the sector can
and should have in order to
function at its highest level.
Underestimating the
Power of Nonprofit Governance
by Ruth McCambridge
P H OTO G R A P H : C A S T I L LO
Editors note: This article was first published in the Nonprofit and Voluntary Sector Quarterly, in June 2004.
uch of the dialogue around nonprofit
conversation was, as they say, absolutely bril-
boards has focused on secondary
liant. The participants in this conversation were
or transactional issues rather than
functionaries in the Department of Culture and
on the question of what good gov-
Leisure, one of eleven ministries in the new, shared
ernance must include in a nonprofit setting. This
government. I was there to help debrief them on
serves to rob the nonprofits of creativity, rigor,
their use of Future Search,1 a highly inclusive plan-
power, and the kind of finely tuned understand-
ning process they had been using to suss out the
and are open to the
ing of accountability the public should expect. By
resource-, policy-, and system-change needs of
focusing on the central questions and principles
whole fields of endeavor (in their case, everything
intellect and creativity
of nonprofit governance rather than on structural
from soccer and libraries to archives, arts, and
of, the people they are
concerns, the possibilities for a wider variation in
culture). The process attempts to bring the whole
governance models open up. All organizations are
system into the room in order to have conversa-
established to benefit?
set in a larger social context, so we cannot end
tions about the future of the thing about which
our reflection at the individual nonprofit level.
all have passion and concern. Participants seek
These questions are particularly pertinent during
out the best way forward and envision a different
a period when our attention is focused on gover-
future that will involve all of them in its realization.
nance from Wall Street to Baghdad. Some believe
In the process, they began to see the practice,
that public governance is overly affected by cor-
and potential, of governance differently. To tell
porate interests, and we are now seeing case after
you the truth, one middle-aged man commented,
case of scandals exposing ethical problems in the
for the first time in my experience, this has given
governance of corporations that only recently
government the extraordinary opportunity to be
were seen as exemplary. This puts the interests
on the same page as the people that it governs.
of ordinary and particularly marginalized people
What a powerful moment that was, summing up the
at risk. In a democracy, the nonprofit sector is
cognitive dissonance sitting smack in the middle of
there to ensure that people have a voice in our
our democratic system of governance.2 The woman
futureat the community, national, and global
who had introduced Future Search into Northern
levels. If we accept this as our primary role, it
Irelands devolved and newly democratic govern-
has implications for what should be present as
ment was Aideen McGinley, herself a thirty-year
constants in our governance structures.
civil servant. In the fall 2003 issue of the Nonprofit
Are nonprofit institutions acting in ways that

respect, and are open to the intellect and creativity of, the people they are established to benefit?
If not, what are we inadvertently putting at risk?
Have we made ourselves party to a larger problem
of democratic deficit in this country by too often
squatting ineffectually in the place needed for its
revival? I think nonprofit leaders are increasingly
missing the point of nonprofit governance and,
as a result, functioning without the power and
influence we might otherwise have.
A Quantum Leap Regarding the Possibilities

On a gray day in December, a group of civil servants sat around a gray, windowless room in a
Are nonprofit
institutions acting
in ways that respect,
Quarterly, she commented on the ethical construct

that motivated Future Searchs use:
Responsible governance at every level
requires us to be the voice of the people we
represent. This is not a charge that should
be taken lightly. It requires us to take the
time to enable people to tell and make
meaning of their own stories, so others
can act with them on their own behalf. The
single most difficult issue we face globally
is keeping people motivated. There is such
disengagement and disillusionment about
political systems and when people are disillusioned they will disengage.
government building in Northern Ireland. The
R uth M c C ambridge is the Nonprofit Quarterlys editor
biscuits were packaged, the tea was tepid, but the
in chief.
When Governance Is the Message
to take the integrity of charitable institutions seri-
More than a decade ago, I read and was deeply
ously when Paul Cabot Jr., the scion of a deceased
moved by an article called, When Management is
local philanthropist known for his stereotypical
the Message, by Thomas H. Jeavons. In it, he sug-
Brahmin frugality, explained earnestly that he had
gested that the general public was disheartened
to raise his salary as a trustee of the Paul and Vir-
by a growing gap between the institutionally self-
ginia Charitable Cabot Trust to provide his wife
serving management interests of nonprofit orga-
with her expected $10,000 monthly allowance
nizations on one hand and the values embodied
(She seems to think its not enough, like most
in our mission statements on the other. Reflecting
women, he explained) and also, by the way, to
on this gap, he wrote, Perhaps it is because the
cover $200,000 of expenses from his daughters
in an increasingly
American public has higher expectations of ...
wedding. This while the assets of the trust have
institutionalized sector
nonprofit organizations. The fact is that, as con-
plummeted and while its annual disbursements
sumers, we half expect to be taken occasionally,
have generally hovered at less than half of his
progressively more
or at least disappointed by, for-profit firms trying
annual salary.
to increase their profit margin at our expense,
This changes the tone of the conversations that
beholden to business and
and as taxpayers we almost assume that large
people have with one another about nonprofits.
corporations will cheat the government when
A cab driver recently snorted at me, Sweet deal,
they think they can get away with it, but we fully
huh? after I responded to his question about what
expecteven demanda higher level of integrity
I did. This fully justified cynicism does not affect
from charitable or philanthropic organizations.
just foundations. It colors our ability to believe in
We tend to believe ... that they should operate
the honor of a much wider set of nonprofit institu-
with different values and that greater integrity
tions that are critically important to the health of
in their operation is something we have a right
our democracy. Although the Cabot Trust story
to expect.
points to a lack of reasonable controls, this is only
At the very least,

such erosion of our
relationships with
constituents will result
government interests.
I would suggest that this faith is fast waning

and that, if it disappears altogether, we will have
the tip of the iceberg of what I see as a crisis in the

governance of nonprofits.
no one to blame but ourselves. This time, it is not

the nonprofit sector but governance. And if we
The Real Cost of a Governance Crisis:

Weakened Democracy
cannot restore the integrity of our governance
Roger Lohmann has proposed that this sectors
systems, nonprofits will lose more than their repu-
true purpose is to provide the venues where
tations. As Jeavons said, nonprofits may find the
people can become involved in the commons. I
very existence of their organizations threatened,
agree that this traditional chewy center of our
because the privileges and support on which they
identity is where our true distinction resides.
depend for survival could be withdrawn as the
The commons is elsewhere described as the
result of public disappointment. At the very least,
social and political place where things get done
such erosion of our relationships with constitu-
and where people derive a sense of belonging and
ents will result in an increasingly institutionalized
have a sense of control over their lives. Elabo-
sector progressively more beholden to business
rating on how things get done, Lohmann argued
and government interests.
that there are five characteristic dimensions of
management that is eroding public confidence in
Public disappointment is already palpable. You
collaborative common action:
might say that, with regards to the recent spate
Free and uncoerced participation;
of scandals about self-dealing among trustees of
Common or shared purpose;
foundations, as a Boston resident I sit in the belly
Participation that involves a sense of mutuality;
of the beast. A spotlight team from the Boston
Jointly held resources or endowment; and
Globe has found a great deal of low-hanging fruit in
Social relations that are characterized by
its recent investigation of philanthropys miscre-
justice or fairness.
ants. It is difficult to expect the general population
In the end, consistently violating the publics
expectation that these characteristics are held and
Why Are We Replacing Furniture?
valued within our organizations is far worse than
Were not even responding to this other gover-
the theft of some cash by corrupt philanthropists.
nance crisis in which citizens disengage from
Because the nonprofit activity people become
working in the commons. In a recent issue of the
involved in on a voluntary basis is often con-
Nonprofit Quarterly, Gus Newport, who has been
nected to something that matters to them at an
involved in both public sector and nonprofit gov-
emotional level, it has the potential of acting as
ernance, offered one example of how nonprofits
an excellent training ground for any number of
can erode or build civic capacity. He told the story
disciplines important to civil society and active
of an inner-city community in which urban blight
democracy. It can, for instance, help people to
had laid waste to the environment. Abandoned
from systems that
understand first-hand what steps they might take
lots with toxic waste had replaced housing, parks
to change circumstances that trouble them. This
were unsafe for children, and the streets were
disengage from them.
will likely provide them with enhanced knowledge
unsafe for all. At some point, a funder visited one
and analytical skills about legislative and political
of the local nonprofits to respond to a request for
systems, social history, media portrayal of issues
furniture. He caught sight of a map of the com-
that they care about, and a host of other topics. If
munity and asked what all of the blacked out
they are learning about these things in the course
areas were. Upon hearing that they represented
of taking action that eventually produces results,
abandoned property, he asked, We come out here
the learning is robust and not only usable but also
to award a grant to replace some worn furniture
teachable by each person involved.
when half the neighborhood is missing?
But although I often hear terms like civil sector,
This community was certainly populated with
voluntary sector, and independent sector bandied
its share of nonprofits. But, as Newport related,
about, with lots of aspirational language, I hear
in not advocating for meaningful change through
very little conversation about how the way non-
common strategies and rigor, these nonprofits had
profits organize their own governance systems on
become party to the ongoing poor condition of the
a practical level accrues to the end result of citizen
community. Where were the boards of these orga-
engagement in the commons. This seems to me to
nizations? Were they asleep at the helm? Did they
be a significant oversightone that threatens to
not take their responsibilities seriously enough to
weaken participation in the commons. My belief
evaluate the conditions that their nonprofit orga-
is that most people are wise enough to eventu-
nizations were charged with correcting?
ally disengage from systems that disengage from
Our public expects much of usat least more
them; engagement is not sustainable in any kind
than allowing our operations to become institu-
of an energetic way when it does not observe
tionalized in a way that limits their freshness, their
fully the mutuality principle mentioned above.
edginess, and their effectiveness and that puts
Further, people are likely not only to disengage
institutional interests ahead of constituent ones.
but to become cynical about the value of getting
This may lead nonprofits to act in isolation from
personally involved in civic life.
obviously necessary partners. As Jeavons argued,
Some of you may be excusing yourself from
An organization may operate in a manner that
this conversation by this time, believing that I
is completely above board and beyond reproach
am only talking about nonprofits involved in
but fail to see how its specific mission relates to
organizing and social change. Not at all. I am
other issues bearing on the public good. Newport
talking about any group involved in a sphere of
talked about this in his vivid example:
common-cause worknonprofit hospitals, the

local Bach society, the local Boy Scout troop. The
governing body of any group organized to meet
the needs of a particular grouping of people has
a number of responsibilities we are not yet fully
acknowledging.
My belief is that most

people are wise enough
to eventually disengage
The area served by DSNI [the Dudley Street

Neighborhood Initiative] was already
served by a number of nonprofits, divided
up by issue areahousing, youth work,
labor and job training, multiservice centers,
a combination of organizational histories.
Accountability: Engagement, Rigor, and

Integration of the Issues
Despite the existence of all of these groups
Although we have been spending time and ink
the area was a picture of urban devastation.
on how to get boards to be minimally involved
childcare, etc., by ethnic group and even by
Although we have been
in the stuff that counts to our organizations, our

Eventually, the foundation that came out to
communities and constituents have been falling
replace the furniture offered to finance a full-
out of love with us. And who is to blame them?
scale effort to rejuvenate the neighborhood. But
We are not paying the right kind of attention to
the residents resisted the idea of any of the local
them in the relationship. As we set our direction,
nonprofits acting as lead. This, Newport said,
we should be in broad and deep consultation and
in the stuff that counts
tells us something about the disconnect between
engagement with them, so that, as that Northern
to our organizations,
these organizations and the people they served
Ireland civil servant said, we can be assured of
and tells us something about local boards lack of
being on the same side of the fence with them.
our communities and
stewardship. The Dudley Street Neighborhood
This requires that we be inclusive of those who
Initiative was eventually developed to facilitate
should be beneficiaries of our work. Because we
constituents have
planning and organizing among the residents
want to be affected by their hopes and dreams,
who controlled the organization. The results
our processes for their inclusion in planning and
are striking: Vacant lots have been transformed
evaluation, in the development of their analysis
into 440 new homes, a town common, gardens,
of the barriers and opportunities to the work,
urban agriculture, parks and playgrounds, and
should be sophisticated and a central focus of
500 housing units have been rehabbed. Busi-
governance.
spending time and ink

on how to get boards to
be minimally involved
been falling out of

love with us. And who
is to blame them?
ness is growing and the rebuilding continues
Additionally, we should be as analytical as pos-
today. Newports governance example empha-
sible about the source points of problems limiting
sizes the disciplines of inclusion, transparency,
or even tormenting the populations of people we
continuous leadership development (to ensure
work with. And we should be rigorous enough to
increasingly skilled engagement from constitu-
work with them to choose an intervention that
ents), rigor in planning, and active networking
promises real, sustainable relief from systemic
to ensure that strategies chosen are both highly
problems and an improved long-term future. This
leveraged and supported. This stands in some
means that our boards should be attentive to any
contrast to the usual vision of what nonprofit
research going on in their fields of endeavor as well
boards can and should do. Rather than focus
as in other fields that affect their work. Our boards
on the larger, constituent-driven purposes that
should be attentive to our public policy context
Newport urged, consultants and researchers
and to opportunities to really collaborate toward
have encouraged a more narrow focus in which
higher level solutions than exist now. Dudley
boards work is about organizational controls
Street Neighborhood Initiative, for instance, was
and resource development. I would liken this to
able to obtain eminent-domain power over the
replacing furniture: It is a pretty unimaginative
neighborhoods empty lots, thereby providing the
and constrained approach to a situation full of
residents with remarkable control and leverage in
need and potential. As Bill Ryan, Richard Chait,
development planning.
and Barbara Taylor pointed out in their wonder-
ful article Problem Boards or Board Problem?,
Awe-Inspiring Potential in Governance Reform?
We can approach the problem of purpose in two
Active citizenship is a means by which we can
ways. We can attempt to expose the board as an
all participate in shaping the society in which we
irrelevant institution constructed around a set
live. In Silent Theft: The Private Plunder of Our
of hollow roles and responsibilities. Or, as we
Common Wealth, David Bollier talked about the
prefer, we can ask whether the purposes now
commons (our job, remember?) as being flexible
ascribed to boards might be necessary, but insuf-
yet hardy precisely because it draws informa-
ficient, to sustain engaged and effective service.
tion from everyone in a bottom-up flow. This
means the rules are smarter because they reflect
as an entree a more energetic and purposeful dis-
knowledge about highly specific, local realities.
course about the reform of nonprofit boards
Inclusive decision making is more likely to be
one that might change how we think about the
responsive and tailored to actual realities. The
sectors role in democracy and its power and
effectiveness of collective decision making in a
influence overall.
commons is not really surprising. Rules informed

by popular participation are more likely to have
N otes
moral authority because everyone affected by the
1. For more information, see www.futuresearch.net.
rules has had a say in formulating them.
2. Participants in the meeting cited other benefits
Bollier went on to promote collective partici-
of inclusive planning, including increases in social
pation and decision making as behaviors that lead
capitalbecause it helps participants clarify their own
to a high capacity to adapt and sustain collective
position, spirals the power of formerly low-power
effort because they provide such rich feedback
groups, lets us get a more layered analysis, and
from such diverse sources. It is the responsibil-
creates a pressure cooker of creativity.
ity of local nonprofitsif they are serious about

representing and responding to constituent inter-
R eferences
eststo have governance mechanisms that can
Bollier, D. 2003. Silent Theft: The Private Plunder of
convene the individuals they are established to

serve with other stakeholders, engage them in
dialogue with the organization and one another,
moral authority because

everyone affected by
the rules has had a say
in formulating them.
the Commons. London: Earthscan Publications.

Government of Western Australia, Department of the
Premier and Cabinet, Citizens and Civics Unit.
gies that will take the group from here to there.
2003. A voice for all: Strengthening democracy.
In doing this, the organization must help partici-
Western Australia Citizenship Policy.
pants understand historical, social, and political
Healy, B., Latour, F., Pfeiffer, S., and Rezendes, M. 2003.
issues that affect the situation. This helps each
Some officers of charities steer assets to selves.

The Boston Globe, October 9, 1.
allows for messages to move powerfully from the
Jeavons, T. 1992. When Management Is the Message.
individual to the collective and from the local to
Nonprofit Management and Leadership 2(4):
the regional to the national consciousness.
403416.
If all of us in the nonprofit sector were to
Lohmann, R. A. 1992. The Commons: Perspectives on
really take this seriously as our own unique
Nonprofit Organization and Voluntary Action.

San Francisco: Jossey Bass.
might find a way to profoundly alter the current
Lohmann. 2003. The commons: Our Mission If We
priorities of government, rehumanizing and
Choose to Accept It. The Nonprofit Quarterly 10,
lending a depth of agreed-upon values to what
no. 2 (summer 2003): 610.
now passes as political discourse. Nonprofit
McGinley, A. 2003. Making Hope and History Rhyme.
boards in their styles of governing could provide
The Nonprofit Quarterly 10, no. 3 (fall 2003): 1623.
a model for a more active and inclusive democ-
Newport, G. 2003. Why Are We Replacing Furniture
racy. They could promote civic learning and they
When Half the Neighborhood Is Missing? The Non-
could be the avenues for the rich intelligence
are more likely to have
Ecologist. 1993. Whose Common Future? Reclaiming
of what can be accomplished, and develop strate-
role, if we were to claim it and fully exploit it, we
popular participation
Our Common Wealth. New York: Routledge.
develop a collective dream of the future or vision
participant be a more active democratic agent. It
Rules informed by
profit Quarterly 10, no. 3 (fall 2003): 1015.
that flows from local to national engagement in
Ryan,W., Chait, R., and Taylor, B. Problem Boards
public life. But we would need to look at our
or Board Problem? The Nonprofit Quarterly 10,
roles differently. We would need to see ourselves
no. 2 (summer 2003): 7377.
as facilitators not only of highly effective action

within the realms of our own mission purviews
but of a renewed and improved democracy at
the national level. Perhaps it is time to take up
governance
Reframing Governance II
Are boards irrelevant? While many in the nonprofit world have been
increasingly vocal in expressing concern that nonprofits are
not developing different forms of governance, the form has changed on its
own. Now that the larger and more substantive aspects of governance
decisions have increasingly moved to realms outside of the organization,
nonprofits must examine how to reorganize to be effective
stewards in this new context and strategize about how they might
better interact with networks to meet key community aspirations.
Editors note: This article, adapted from its print publication version in the winter 2006 issue of
NPQ, was previously published on NPQs website.
any members of the nonprofit world
our communities. But we have not identified this
have expressed concern that the
shift because were so focused on the artifact that
sector has not developed new forms
we know as the board.
of governance. We have not, they
It used to be that boards and governance were
complain, seen anything more than a minor varia-
substantially the same: the two concepts over-
tion on current designs and practices. For some
lapped. But with time and a radically changing
time, I shared this perspective. But then I realized
environment (i.e., changes in the complexity,
that this is not exactly true. We have created the
pace, scale, and nature of community problems
new nonprofit governance at a new level within
and needs), the domain of governance has

moved beyond the domain of the board. Gov-
D avid O. R enz , P h D, is the Beth K. Smith/Missouri Chair
ernance and boards have greatly diverged in
in Nonprofit Leadership and director of the Midwest
many of the settings where we address our most
Center for Nonprofit Leadership at the L. P. Cookingham
complex and demanding community needs. But in
Institute of Public Affairs, Henry W. Bloch School of Busi-
these complex environments, boards of individual
ness and Public Administration, University of Missouri
organizations serve the functions of governance
Kansas City.
less and less well.
Callout tk
P H OTO G R A P H : E Y E W I T N E S S
Governance is not about
In these environs, governance truly is leader-
moved above and beyond any individual nonprofit
ship. And in this new generation of governance,
organization. If organizations do not work as an
which has most actively evolved in segments of
integral part of this larger whole, they dont get to
the nonprofit sector where agencies strive to
join or stay in the game.
address these challenges, nonprofit boards are
Why dont we see these developments, even
merely one element and no longer the primary
when were looking directly at them? Because
home of the governance processes by which we
were still prisoners of the hierarchical, control-
essential function in
address our most critical community issues.
oriented paradigm of conventional organizing
addressing a particular
capacity of our existing freestanding organiza-
issue or need in
tions to respondsometimes in terms of size,
But the new governance does not look like
our community.
but especially, and more important, in terms of
anything we expect (even though we talk about
complexity and dynamism. Therefore, weve orga-
these issues quite often). Consider these changes:
nized or developed our response at yet another
No individual or entity is always in charge
organization; its an
The scale of these problems has outgrown the
level: the interorganizational alliance.

In the new mode, the organization may well
be the unit from which services are delivered,
we continue to look for a central leader, whether

a person or a unit.
(though some certainly have more influence

than others). In fact, allowing any one entity to
regularly be in charge is often resisted.
but such service delivery is designed, organized,
The structure continually evolves and changes
resourced, and coordinated (in other words,
(though its general characteristics remain
governed) by the overarching network of rela-
consistent).
tionships (among organizational leaders) that

crosses and links all participating organizations
We have been trained to focus our attention on

boards rather than on governance.
and entities. Similar dynamics have emerged in
Governance is not about organization; its an
some parts of the nonprofit policy and advocacy
essential function in addressing a particular issue
domain, where different organizations actions
or need in our community. For so long, individual
are orchestrated by a coordinated governance
organizations have been the appropriate unit to
process that operates largely beyond the scope of
address problems, and we assumed that it would
any particular board, even as it deploys lobbying
always be this way. But now, single organizations
resources from various individual organizations.
can no longer appropriately match the scale for

the most critical and substantive community
The New Nonprofit Governance Model
issues and problems. It has become increasingly
Governance is a function, and a board is a struc-
necessary to develop alliances and coalitions
tureand, as it turns out, a decreasingly central
extraorganizational entitiesto address the
structure in the issue of new or alternative forms
multifaceted complexity of these critical needs
of governance. Dont get me wrongboards are
and issues. And the most successful systems
still important in nonprofit governance. But, for
weve developed to govern these alliances reflect
many key community problems and issues, theyre
the same scale and complexity as the alliances
not always appropriate as the unit of focus.
themselves.
Governance processesprocesses of deci-
These systems of leadership mirror the design
sion making concerning action based on and
of social movements, with the fluidity and respon-
grounded in a shared sense of mission, vision,
siveness that characterize the most effective of
and purposeinclude the functions of setting
these movements. As anthropologist Luther
strategic direction and priorities; developing and
Gerlach describes them, emerging systems of
allocating resources; adopting and applying rules
governance have the following characteristics:1
of inter-unit engagement and relationships; and
Segmentary: they comprise multiple groups
implementing an ongoing system of quality assur-
and organizations, each of which is only one
ance that applies to all constituent organizations.
segment of the whole that works to address the
In many key areas, these processes have
issue at hand;
Polycentric: they have multiple centers of
than the constituent organization.
activity and influence to advance progress in
If youre in one of these new systems of gov-
addressing the cause of the whole, though each
ernance, your board has less strategic room to
does its own work;
move. Youre dancing to the tune of a piper (or,
Networked: the multiple centers of activity are
more likely, multiple pipers) beyond your orga-
linked via a web of strategic relationships, and
nizations boundaries. In other words, the gov-
an important source of the organizational power
ernance of your work has moved beyond your
of this web comes from the informal relation-
organizations boundaries (and your organization
ships that exist among those in leadership roles
no longer has its former level of sovereignty).
in the various centers of activity; and
Does this mean that boards of individual agen-
If youre in one of
these new systems
of governance, your
board has less strategic
Integrated: these networks are connected by
cies are no longer relevant? No, not any more than
a core but evolving ideology that crosses orga-
any one program in a multiservice human-service
nizational (and even sectoral) boundaries as
agency is automatically irrelevant because it is
dancing to the tune of
those who work to address the full range and
part of the larger whole. The board is necessary,
complexity of an issue go wherever necessary
and, at its level, it offers critical value. But its not
a piper (or, more likely,
to engage in their work.
the only level of governance that existsnor is
In some cases, integration comes from those
it the overarching and highly autonomous entity
who hold a formal position in one organization
that historically had the luxury of being in charge.
(e.g., a staff position in a government agency)
Its just not the only level anymore.
but who also serve in other organizations (e.g., a
At their best, such governance systems dem-
board member in a nonprofit agency or a leader
onstrate the ideal characteristics of an effective
in a relevant professional association). All these
governance entity. They demonstrate resilience,
organizations play certain roles in addressing the
responsiveness, fluidity, and an organic connect-
particular issue or problem, and no single entity
edness to the community and its changing needs.
has the authority to direct these efforts (e.g.,
They exhibit processes of mutual influence and
individuals working in AIDS prevention units or
decision making that are more fluid but no less
health agencies but who are also active in advo-
real than those in conventional hierarchical orga-
cacy organizations for HIV and AIDS prevention).
nizations. So what has changed alongside this new
room to move. Youre
multiple pipers) beyond

your organizations
boundaries.
governance?
New Models of Authority, Accountability
Governance must be understood from the per-
Generative leadership and strategy are handled
spective of the theory and research on interorga-
at the metaorganizational level; conversely, indi-
nizational relations and, especially, the work to
vidual organizations (or cells of operation) handle
explain the dynamics of networks and organiza-
the front-line action or delivery of services (i.e.,
tions as integral but not autonomous units within
operations). This structure is consistent with
networks.
and fuels the accomplishment of an interorgani-
What was once understood as boundary span-
zational entitys mission, vision, long-term goals,
ning has become boundary blurring (its increas-
and strategies (all of which are the domain of gov-
ingly hard to tell where one organizations work
ernance). For these areas of community action,
ends and anothers begins).
it is no longer about the networked organiza-
Individual organizations are fundamental cells
tion; it is about the network as organization.
of activity and accomplishment, but their indi-
These systems of organized (but not hierarchical)
vidual behavior and results are not adequate to
influence and engagement link multiple constitu-
explain what has been accomplished at the com-
ent entities to work on matters of overarching
munity-problem level.
importance and concern. In this environment, the
Fueling and enabling the emergence of this new
boards of individual organizations are guided by
governance is the growth in so-called strategic alli-
and often become accountable to the larger gov-
ancesand in the number of organizations whose
ernance system. The frame of reference is larger
capacity has evolved to engage in collaborative
One of the challenges

of this emerging form
of governance is that
it moves the locus of
alliances, with the mutual investment and shared
beyond any one organization. For better or worse,
control of resources, and sharing of risk.
no single entity is in charge, and any agency that
All the above dynamics pose greater challenges
thinks it can call the shots will find its power
for accountability. Appropriate accountability
over others muted. Interestingly, this includes
must focus on the community level (not on an
governmental entities that may still act like they
individual organization); accountability systems
are in charge. The fact that an agency has a legal
must include but cannot be limited to the constitu-
or statutory mandate to address a problem does
ent organizations and their internal management
not give it any real control over the messy prob-
and decision-making structures.
lems that these governance systems have emerged

to address. No urban redevelopment agency, for
control beyond any
New Challenges
example, has ever had the capacity to resolve its
one organization. For
This evolution in governance makes sense from an
urban communitys problems without bringing
organizational theory perspective. Organizational
other entities into the game, and, increasingly,
better or worse, no
theory asserts that an effective organizations
other entities have demanded a substantive role
design will align with and reflect the key char-
in the decision-making process. Part of the power
single entity is in charge,
acteristics of its operating environment. Thus, if
of this new governance is that it can better accom-
an organizations operating environment (includ-
modate and engage this shared-power dynamic.
and any agency that

thinks it can call the
shots will find its power
over others muted.
ing the problems it must address) is increasingly
Some individual organizations boards have
dynamic, fluid, and complex, the appropriate orga-
begun to take on this model. But these boards
nizational response is a design that is dynamic,
and organizations work at the network level, such
fluid, and complex.
as membership organizations comprising all the
These new levels of organizing (for which
service providers in a given domain of service
the new governance is emerging) have all the
(e.g., the coalition of all emergency service provid-
elements of an organization, but they can be
ers in a given metro region). These entities have
confusing. Their elements just dont look like our
been created to bridge and cross boundaries,
conventional organizational elements. Their oper-
and boards have the explicit charge of providing
ating imperative demands that they differ, so the
leadership across agency and sector boundar-
successful model of organization and governance
ies to address specific community issues. Most
needs to be different as well.
nonprofit boards dont look like this because they
This networked dynamic also reflects an
have not seen the need. But as a result of this new
increasingly democratic mode of organizingat
mode of governance, even individual agency
its best, it ties the action (whether provision of
boards now need to rethink how they should be
services or community mobilization) more closely
designed and consider how they will do their work
than ever to the community to be served (and that
as a part of (rather than trying to actually be) the
community often has members actively engaged
new governance design.
in the governance processes in play).

Further, this dynamic does not pay as much
ernance? When you look for it, using this new
attention to sector boundaries as it does to the
perspective, youll actually find it in operation in
capacity to do the work. Thus, the organizations
many domains of nonprofit work. In many metro-
in the networks addressing complex community
politan regions, for example, we find networks
problems are likely to include governmental
of organizations that have joined to address the
organizations and even for-profit businesses, in
changing challenges of HIV and AIDS. They have
addition to nonprofits. The mix of organizations
their own boards, but they also have a regional
depends on the assets they bring, where assets
planning and funding structure that overarches
are defined by the nature of the problem and the
individual structures.
needs to be addressed.
Where might you find this new level of gov-
This overarching structure sets priorities and
One of the challenges of this emerging form of
coordinates the work of individual agencies,
governance is that it moves the locus of control
including providing the venue and organizing the
processes for making regional-wide decisions
(which is why influence is so important). In reality,
about fundraising, marketing, and programming.
the locus of accountability for this new level of
In these cases, each of the key participating agen-
governance must exist above the individual non-
cies boards sends representatives to sit on the
profitat the community levelyet many philan-
overarching entitys board (often these repre-
thropic and governmental funders and regulators
sentatives are a mix of board members and chief
are likely to hold individual nonprofit agencies
executives). But the overarching entitys board
accountable for such community-level perfor-
includes members outside these operating agen-
mance and impact. They will continue to focus on
cies, such as members of the community at large
individual agencies because establishing systems
(e.g., local-issue activists) who have equal stand-
of accountability at the new level will be difficult.
for the next generation
ing with agency representatives.
And they will often be frustrated in their attempts
of nonprofit board work.
This new mode of

governance has
significant implications
We see similar dynamics in many other areas of
to do so, because there is too little control at the
political and programmatic action: in urban rede-
individual agency level. This challenge becomes
It requires different
velopment, in neighborhood revitalization, and in
especially interesting in light of federal and state
emergency services. In all these areas, overarch-
legislative discussions about nonprofit account-
kinds of knowledge,
ing governance systems make strategic, commu-
ability and regulation, all of which treat the non-
nity-level decisions that form the basis from which
profit organization as the primary unit of control.
individual agencies develop and implement their
This is an interesting time in the development
own plans and operations.
of nonprofit governance and our understanding
skills, and abilities. This

is the work of leadership,
not management.
of the work of nonprofit boards. We bemoan the
New Leadership and Accountability Models
absence of anything innovative or cutting edge,
This new mode of governance has significant
but we have already developed a new generation
implications for the next generation of non-
of nonprofit governanceone that is more effec-
profit board work. It requires different kinds of
tively aligned with and responsive to the needs of
knowledge, skills, and abilities. This is the work
the organizations that come together to address
of leadership, not management. So it is essential
the most dynamic and complex needs and chal-
for its participants to be proficient in a different
lenges confronting our communities. Indeed, this
kind of leadership, particularly in the capacity
new generation of governance inherently involves a
to network, to build multifaceted relationships
changing mode of community leadership as society
across boundaries and among diverse groups of
moves from hierarchy to networks as the prevailing
people, and to effectively exercise influence in the
mode of organizing to meet the demands of a new
absence of authority. (In his book On Leadership,
time. As we keep musing, Do we need boards?
John Gardner aptly described this as exercising
and Isnt there a better way? were missing the
nonjurisdictional power.2) The ability to perceive
real point: the emergence of the next generation of
a new level of operation is unique, requiring a mul-
nonprofit and public-service governance.
tilevel systems perspective and a different, often

unfamiliar mental model.
N otes
The new governance poses unique challenges
1. Luther Gerlach, The Structure of Social Move-
for accountability, as well. As difficult as it can
ments: Environmental Activism and Its Opponents,
be to hold a typical nonprofit board accountable
in Waves of Protest, eds. Jo Freeman and Victoria
for its organizations performance and impact,
Johnson (Lanham, Mass.: Rowman and Littlefield,
it is more difficult to implement systems of
1999).
accountability at the new level. And it is espe-
2. John Gardner, On Leadership (New York: Free
cially challenging for external structures to hold
Press/Simon & Schuster Inc., 1993).
these systems accountable: to create externally

enforced Sarbanes-Oxley types of accountability.
The more diffuse and fluid nature of these
designs makes them inherently hard to control
governance
The Road Less Traveled:

Establishing the Link between Nonprofit
Governance and Democracy
by Chao Guo, PhD
Guo focuses
on two research traditions
that illuminate the relationship between
governance and democracy, in the hope of shedding
some new light into understanding the democratic deficit
within the sector and its possible remedy. Because, as Guo
concludes, if the sector as a whole does not recognize that
there is a tremendous unrealized potential for nonprofit
governance to contribute to democracy, it could cost
the sector quite dearly over time.
n recent years ,
research at all: the link between nonprofit gover-
there has been a
nance and democracy.
renewed interest
This failure to establish the link between the
among scholars
governance of nonprofit organizations and the
and practitioners alike in the governance of
interests of the broader public is a disconnect that
nonprofit organizations. An increasing number
is reflected in both the theory and the practice of
of studies address such topics as the formal roles
nonprofit governance. Where theory is concerned,
and responsibilities of nonprofit boards; aspects
research on nonprofit governance is strongly influ-
of board composition, such as size, race/ethnicity,
enced by research on corporate governance and
gender, and demography; the board-staff relation-
dominated by such theoretical approaches as
ship; board effectiveness; board evolution and
agency theory and resource dependency theory.
group dynamics; board recruitment, assessment,
Relatively little attention has been paid to demo-
and renewal; and the relationship between board
cratic and critical approaches that look into the
and organizational performance. But one of the
embedded power dynamics that influence who is
most interesting questions has received almost no
allowed access to organizational decision making:

whose voices get heard and whose get left out.
C hao G uo , P h D, is an associate professor of nonprofit
Where practice is concerned, we see a demo-
management and director of international programs in
cratic deficit in board governancethat is, an
the School of Public and Environmental Affairs at Indiana
absence of democratic structures and processes.1
UniversityPurdue University Indianapolis. He is also a
Many nonprofit boards fall short of being broadly
senior fellow of the Midwest Center for Nonprofit Leader-
representative of the public. They tend to be
ship at the University of MissouriKansas City.
limited to upper-income, professional employers
P H OTO G R A P H : B R I G H T I D E A
and managerial persons, while the community has
analytical framework.3 Pitkin defines representa-
little or no representation. In addition, while some
tion as a multidimensional concept and identifies
nonprofit boards do little beyond rubber-stamping
four important dimensions: formal representa-
the actions of their executive staff, others are prey
tion (how organizational leaders are selected by
to the iron law of oligarchy, where decision-
constituents); descriptive representation (how
making power is concentrated in a small number
organizational leaders mirror the politically
of non-elected board members and the executive
relevant characteristics of constituents); sub-
of their constituents and
director.
stantive representation (how organizations act
the larger community
The democratic deficit in nonprofit governance
in the interest of constituents, and in a manner
poses important challenges for nonprofit leaders.
responsive to them); and symbolic representa-
in their governance
If nonprofit boards fail to include representatives
tion (how an organization becomes trusted by
structure and processes,
of their constituents and the larger community in
constituents as a legitimate representative). The
their governance structure and processes, then to
formal and descriptive dimensions of representa-
then to what extent do
what extent do they have the capacity to govern
tion in Pitkins model in particular serve to ensure
effectively on behalf of their constituents and
that certain representative mechanisms are avail-
they have the capacity
the larger community? How can an organization
able in their governance structures to retain such
contribute to a democratic society if there is a
equality and control of decision making by their
democratic deficit in its own governance?
constituents and the larger community.4
constituents and the
Democratic Approaches to Nonprofit

Governance: Representation and Participation
especially prevalent among nonprofit membership
larger community?
The roots of democratic perspectives on nonprofit
associations, though it is often absent among
governance can be traced back to Alexis de Toc-
charitable nonprofits. Formal representation rests
queville, who studied Jacksonian America in the
upon elections and other formal arrangements,
nineteenth century and highlighted the important
such as recall of officials or term limits. Coopera-
role of voluntary associations in the functioning
tives and other membership associations com-
of American democracy. He perceived the con-
monly use the one member, one vote method
tribution of voluntary associations to American
of leadership election. Yet for many organiza-
democracy at two levels. At the organizational
tions, formal representation is basically limited
level, he felt that associations served as schools
to the act of voting: members are allowed to vote
for democracy, where people develop civic virtues
for leadership-position candidates, but they are
and learn citizenship skills; at the institutional
usually not allowed to nominate the candidates.
level, he saw associations as representatives of
Leadership elections also tend to be characterized
citizen interests, and as counterbalances to state
by low turnout rates and lack of democracy.
If nonprofit boards fail to

include representatives
to govern effectively
on behalf of their
Formal representation in board governance is
and corporate power. Following this tradition,
Descriptive representation offers one possible,
two schools of thought have influenced the devel-
albeit indirect, mechanism for receiving constitu-
opment of a democratic perspective on nonprofit
ent input. Research suggests a link between the
governance: the representational approach and
efficacy of the external representational function
the participatory approach.
of nonprofit organizations and the extent to which
The representational approach. Jeffrey
board composition reflects the actual popula-
Berry, a leading advocate for this approach, makes
tions of their constituents and the larger commu-
the forceful statement, Governance questions
nity (i.e., descriptive representation). However,
are questions about representation. Scholars in
descriptive representation needs to be understood
this line of work are concerned with how well
in conjunction with power relationships: a board
the views of constituents and the larger commu-
may be characterized by having a strong commu-
nity are represented within an organization. Most
nity representation in terms of board composition,
of the existing studies have used Hanna Pitkins
but this descriptive representation is reduced to
conceptualization of representation as a general
tokenism and patronization if the board is a weak
organizations, such as cooperatives and mutual
one that is dominated by the chief executive.
some constituent representatives can actually
Within nonprofit governance studies, the repre-
participate in organizational governanceabove
sentational school of thought regards governance
all, there are only a small number of seats avail-
questions as being about what governance struc-
able on a particular board. Second, constituent
ture and processes are in place to ensure that the
representation and constituent participation in
views of constituents and the larger community
governance might be mutually reinforcing, in that
are well represented within the organization.
nonprofit boards might serve as a better training
Accordingly, the board of directors is designed
ground for citizen participation if the composition
to embody and represent community interests,
of the board were more truly representative of the
and it functions to resolve or choose between the
community, or vice versa.
interests of different groups, and to set the overall

policy of the organization.5
In view of the complementary relationship

between the two, Juliet Musso and I extend
Constituent
representation and
constituent participation
in governance might be
mutually reinforcing, in
The participatory approach. This approach
Pitkins conceptualization of representation by
that nonprofit boards
begins where the representational approach
adding another dimensionparticipatory rep-
leaves off, and is best illustrated by the follow-
resentationwhich entails direct participatory
might serve as a better
ing quote: It is the responsibility of local non-
relationships between organizational leaders
profits ... to have governance mechanisms that
and their constituents, and which focuses on
can convene the individuals they are established to serve with other stakeholders, engage
training ground for

citizen participation if
the composition of the
them in dialogue with the organization and

one another, develop a collective dream of the
board were more truly
future or vision of what can be accomplished,
representative of the
and develop strategies that will take the group

from here to there.6 Participatory mechanisms
NPQ is a courageous
journal
in a field that
will need courage.
may fall along a continuum with respect to the

degree in which constituents and the community
have real powerranging from nonparticipation
(e.g., constituents are placed on rubber-stamp
advisory committees or advisory boards) and
Jack Shakely, NPQ reader
tokenism (e.g., attitude surveys, neighborhood

meetings, and public hearings) to higher levels
of community power (e.g., partnerships) and del-
Thank you for subscribing to NPQ!
egated power (e.g., constituents share planning
We see ourselves as being in deep partnership
and decision-making responsibilities). Through
with you, our readers. We rely on your
various participatory governance mechanisms,
feedback, your survey responses, your stories
constituents get involved in an ongoing public
for our editorial content. Subscribers are the
dialogue within the organization through which
lifeblood of our organization but we also rely
important matters can be communicated and
on your donations for our financial health.
deliberated, and thus have stronger control over

the direction of the organization.
Participatory Representation:
Convergence of the Two Approaches
The participatory approach and the representa-
community, or vice versa.
We keep the cost of our subscriptions low

we dont want cost to be a barrier for anyone!
But if you can give moreand if you value
what NPQ has provided for over twelve years
consider joining a growing group of your fellow
tional approach are inherently connected. First,
readers, and go to www.nonprofitquarterly.org
full constituent participation is not feasible in
to make a donation today.
most nonprofits due to the limited capacity of

any governance structure and processes: only
Ruth McCambridge,
Editor in Chief
Wider constituent
participation in
nonprofit governance
will not only help citizens
maintaining a variety of channels of communica-
to participate more fully in organizational gover-
tion with constituents. Examples of participatory
nance. Some nonprofit leaders might question the
representation include such practices as com-
value of redressing the democratic deficit in the
municating decisions to constituents, obtaining
governance of those organizations whose primary
statistical information about constituents and
mission is not policy advocacy. They might ask
the larger community, inviting constituent input
why it is necessary (or if it is even feasible) to
through user forums and advisory and consulta-
establish democratic structures and processes
tive groups, and engaging constituents in strategic
in a service-oriented nonprofit. But democracy
planning and decision making.
does not belong in just the political arena. Wider
Participatory representation provides a direct
constituent participation in nonprofit gover-
develop civic skills
mechanism for getting input from constituents on
nance will not only help citizens develop civic
and democratic values
important governance decisions. This mechanism
skills and democratic values but also enhance
is particularly important for charitable organi-
the capacity of nonprofit organizations to work
but also enhance the
zations, where formal representation (e.g., elec-
more effectively with their constituents and the
tions and recall of leaders) is often absent, and
larger community.
capacity of nonprofit
where descriptive representation offers only an
This is an exciting time for civil society in
indirect means of receiving constituent input. A
that there seems to be renewed interest in public
direct and participatory relationship between
deliberation and collective action. At the same
leaders and constituents also provides opportu-
timeperhaps driving this renewed interest
nities not only for the organization to understand
information and communication technology has
the general values and beliefs of constituents but
begun to unleash new possibilities for democratic
also for constituents to ensure that the organiza-
governance. Social media are equipping organiza-
tions activities and outcomes do not stray from
tions with the opportunity to instantly commu-
their values. Furthermore, constituent participa-
nicate with a broader range and new generation
tion might also complement and enhance descrip-
of constituents and engage them in joint action.
tive representation. For instance, much evidence
Nonprofit governance is no longer limited to the
indicates that even when racially and ethnically
boardroom; it is reaching out to people, partners,
diverse individuals are appointed to nonprofit
and communities like never before. In the dawn
boards, they are not necessarily included as full
of a participatory revolution characterized by
and equal board members. This suggests that, in
the power of the Internet and social media, an
order to achieve effective governance, it is far
organization that fails to recognize and address
from enough for diverse board members to have
the democratic deficit in its governance will be
a place at the board table: they must [also] be
left behind. And, if the sector as a whole does not
welcomed, have their voices heard and opin-
recognize that there is a tremendous unrealized
ions valued, and play leadership roles. In other
potential for nonprofit governance to contribute
words, board diversity (descriptive representa-
to democracy, it could cost the sector quite dearly
tion) must go hand in hand with inclusiveness
over time.
organizations to work
more effectively with
their constituents and
the larger community
(participatory representation).
N otes
Concluding Remarks
1. A democratic deficit occurs when ostensibly demo-
The representational and participatory
cratic organizations or institutions in fact fall short
approaches to governance identify three lines of
of fulfilling what are believed to be the principles of
defense against the democratic deficit: formal
democracy. Sanford Levinson, How the United States
representation, descriptive representation, and
Constitution Contributes to the Democratic Deficit in
participatory representation. Taken together,
America, Drake Law Review 55, no. 4 (2007): 85960.
they suggest that nonprofits should restructure
2. Jeffrey M. Berry, An Agenda for Research on Inter-
their boards and their relationships with constitu-
est Groups, in Representing Interests and Interest
ents, and that constituents should be empowered
Group Representation, eds. William Crotty, Mildred
A. Schwartz, and John Clifford Green (Lanham, MD:
Annals of Public and Cooperative Economics 75,
University Press of America, 1994), 2128.
no. 1 (March 2004): 1132.
3. Hannah F. Pitkin, The Concept of Representation
6. Ruth McCambridge, Underestimating the Power
(Berkeley and Los Angeles, CA: University of Califor-
of Nonprofit Governance, Nonprofit and Voluntary
nia Press, 1967).
Sector Quarterly 33, no. 2 (2004): 34654, nvs.sagepub
4. According to Chao Guo and Juliet Mussoin Rep-
.com/content/33/2/346.
resentation in Nonprofit and Voluntary Organizations:
7. Barbara A. Metelsky, Selection, Functions, Struc-
A Conceptual Framework, published in Nonprofit
ture, and Procedures of the Nonprofit Board, in
and Voluntary Sector Quarterly 36, no. 2 (June 2007):
Leadership in Nonprofit Organizations: A Reference
30826, nvs.sagepub.com/content/36/2/308the sub-
Handbook, ed. Kathryn A. Agard (Los Angeles: Sage
stantive and symbolic dimensions are the most direct
Publications, Inc., 2010), 2: 491502.
measures of the democratic capacities of nonprofit

organizations. The former provides tangible results
F urther R eading
in terms of agendas, policies, and activities, while the
Chao Guo, Barbara A. Metelsky, and Patricia Brad-
latter provides intangible value in terms of trust and
shaw, Out of the Shadows: Nonprofit Governance
legitimacythey are representational output mea-
Research from Democratic and Critical Perspectives,
sures of the extent to which organizations act for and
in New Perspectives on Nonprofit Governance, eds.
stand for constituents. The formal and descriptive
Chris Cornforth and William Brown (London: Rout-
dimensions are representational input measures
ledge; forthcoming).
that is, they are different means of achieving substantive and symbolic representation.
5. Chris Cornforth, The Governance of Cooperatives
and Mutual Associations: A Paradox Perspective,
Collected Wisdom from the Nonprofit Quarterly

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Nonprofit
THE
Q U A R T E R L Y
governance
Adding a Few More Pieces

to the Puzzle:
Exploring the Practical Implications

of Recent Research on Boards
What is it that
enables boards to be
strong and effective,
Editors note: This article was first published in NPQs spring 2011 edition.
and why are we
still using outdated

models in an effort
to improve board
performance? Here
Renz discusses five
streams of research
that can be put to
he challenge of leading nonprofit organi-
agencies afloat and find enough time to meet too
zations in todays tumultuous and
many demands in too little time, most nonprofit
complex environment encourages both
leaders simply dont have the energy to sort out
nonprofit leaders and researchers to pay
the practical implications and value of even the
more attention to studying nonprofit boards and
best research. In the spirit of help, this article
what enables them to be strong and effective.
offers an overview of some of the most useful
Perhaps more than ever, nonprofit organizations
recent research on nonprofit boards and gover-
and their leaders are dedicated to developing
nance, and suggests some of the practical insights
highly effective ways to govern and lead, and to
the research has to offer.
enhance their performance, competitiveness, and
practical use in your
strategic advantage.
The volume of published work on boards and

governance continues to grow rapidly. Our review
Unfortunately, even as we develop increas-
of recent research indicates that, compared with
ingly important insights into the changing nature
ten years ago, nearly three times as many board
of boards and their work, far too many in the
research articles have been published. Clearly,
effectiveness, design
sector continue to base their understanding of
this is a significant market niche. But if we look at
and roles, and the
board work on anecdote, conventional wisdom,
the research, what does it tell us? At first glance,
and stories from the past. Of course, in these
it seems that academics and researchers report
challenging times this shouldnt be too surpris-
what weve known for quite some time: the world
ing. Given the pressures of trying to keep their
of nonprofit boards and governance is messier and
organization: board
variation, capacity,
governance of real
consequence that
happens outside of
boards at a more
macro level.
more complex than ever. But embedded in this

D avid O. R enz , P h D, is the Beth K. Smith/Missouri Chair
work are important elements of practical clarity
in Nonprofit Leadership and director of the Midwest
for those who care to take notice.
Center for Nonprofit Leadership at the L. P. Cookingham
As we continue to follow the growing body
Institute of Public Affairs, Henry W. Bloch School of Busi-
of nonprofit board research, we find particular
ness and Public Administration, University of Missouri
value in five general streams of inquiry: (1) varia-
Kansas City.
tion across the world of nonprofit boards;(2)
Callout tk
P H OTO G R A P H : L I S B OA T I M E WA R P
For all that has been

written over the past
two decades on the
subject, almost none
important elements of board capacity;(3) assess-
board members, and 20 percent say that it is
ment and understanding of board effectiveness;
very difficult. Interestingly, Ostrower reports
(4) understanding board design and roles; and
that there is no evidence to suggest that com-
(5) governance across organizational and other
pensating board members helps agencies to
boundaries.
attract more effective members (only roughly
Each stream adds a little more to our understanding of the complicated and dynamic world
of nonprofit boards.
2 percent of these nonprofits compensate their

board members).
Furthermore, recruiting from among board
members friends and acquaintancesthe
of it reflects complete
Understanding Variation in the

World of Boards
most common approachturns out to be coun-
or systematic research
For all that has been written over the past two
acquaintance recruitment show lower levels of
toward understanding
decades on the subject, almost none of it reflects
effectiveness on all aspects of board work other
complete or systematic research toward under-
than fundraising. The study also surfaces an
the universe of
standing the universe of nonprofit boards, how
interesting finding about the link between chief
they are organized, and how they work. In a recent
executive board membership and board perfor-
nonprofit boards.
sector-wide study of more than 5,000 U.S. non-
mance: chief executives serve as members of
profit charity boards, Francie Ostrower and col-
the board for roughly 21 percent of the agencies
leagues have begun to rectify this shortcoming.
in the survey, yet boards that include the chief
The study is the first ever to secure a truly repre-
executive as a voting member generally perform
sentative sample of American nonprofit charities,
less well in the areas of financial oversight, policy
and relies on executive directors as its source of
setting, community relations, and influencing
information. So it reflects only one perspective on
public policy. In fact, no board activities are posi-
boards, yet offers valuable insight (and confirms
tively associated with having the chief executive
some fears as well).
as a board member.
terproductive. Boards that rely on friend or
Ostrowers report presents useful statistics on
The study offers many more insights than
boards and who serves on them. Not surprisingly,
the few I share here, and I encourage all who
fully half of all nonprofit charity boards have only
are interested in boards and board effective-
white (non-Latino) members. And while the
ness to review the reports that Ostrower and
average board is about 46 percent female, only
others have prepared (see references at the end
29 percent of very large nonprofits (with annual
of this article for relevant sites). I have to flag
budgets of over $40 million) have any women on
an additional insight from the study, however,
their boards at all. Furthermore, these boards
that involves the impact of board size: Ostrower
are quite middle-aged: a full 78 percent of their
finds no relationship between the size of a board
members are between the ages of thirty-six and
and the level of its members engagement;nor
sixty-five. Astonishingly, only 7 percent of all
does she find any link between the boards size
charity board members in America are younger
and its performance. Apparently, board size
than thirty-six.
does not matter.
The Ostrower study also offers some impor-
Subsequent to the release of her initial reports,
tant insight into the relationship between who
Ostrower had the opportunity to home in on the
sits on a board, how he or she came to be
characteristics of what she labels midsize non-
selected, and how well the board performs its
profit organizations.2 The organizations that fall
key tasks (such as financial oversight, policy
into this group have annual budgets within the
setting, community relations, influencing public
range of $500,000 to $5 million. One could argue
policy, CEO oversight, fundraising, and moni-
that this range is so large as to include too diverse
toring board performance). Almost all boards
a group of nonprofits (there are significant dif-
report trouble recruiting well-qualified members:
ferences between the half-million dollar non-
70 percent say that it is difficult to find qualified
profits and the multi-million dollar nonprofits,
for example), yet this newer research begins to
and board trainers everywhere. Brown exam-
offer additional insight into how board practices
ined the link between effective recruitment
and characteristics vary according to organiza-
practices, orientation practices, and board and
tional size.
member job performance. He found that effective recruitment and orientation contribute to
It should not be
Elements of Board Capacity
board member competence, and that board
Three recent studies provide insight into the value
member competence is highly related to overall
of developing board capacity. Truth be told, the
board performance. Interestingly, board orien-
that ambiguity about
insights are not startling;but still, they raise some
tation is also directly related to positive board
troubling questions about why we do not put
performance overall, not just the competence
roles has an adverse
into effect what we already know about ways to
of its members.
develop boards.
One final aspect of this study raises an impor-
Bradley Wright and Judith Millesen examine
tant question: How is it that while Brown found
the degree to which board members understand
a clear connection between the use of effective
their roles and the expectations for their perfor-
recruitment and orientation practices and overall
mance as members.3 Their study surveyed both
board member competence, these practices
board members and chief executives, providing
explain only about one-third of the members
a nice mix of sources. It should not be surprising
level of competence? Clearly, as we continue our
to learn that ambiguity about roles has an adverse
research, there is more to learn.
effect on board-member engagementmultiple
A nice study done in 2006 by Sue Inglis and
studies on volunteer performance and turnover
Shirley Cleve examines a different dimension of
have told us this for years. But what Wright
board capacity: the motivations that lead people
and Millesen tell us about what we really do is
to serve on nonprofit boards.5 The article offers
troubling. Most board members report that they
a complete review of the research on this field,
learned their roles on the jobwhile actually
and it does an excellent job of building on that
serving on the boardas opposed to having been
work to help us better understand the needs and
provided the relevant information prior to start-
interests of those we want to attract to our boards.
ing their board service. Both chief executives and
Inglis and Cleve found that board members moti-
board members agree that boards do very little
vations to serve could be grouped into six general
for members in the way of orientation, training,
categories:
or ongoing feedback. And boards disagree about
Enhancement of self-worth;
how well board members do their work. About
Learning through community;
two-thirds of all board members report that they
Helping community;
understand the expectations and their roles well,
Developing individual relationships;
yet only roughly 40 percent of chief executives are
Unique contributions to the board; and
confident that their board members understand
Self-healing.
their roles. At the same time, chief executives tend
Given how difficult many nonprofits say it is to
to agree that they are not providing their board
recruit good members to their boards, it makes
members with the orientation, training, feedback,
sense for a board to consider these motivations
or other ongoing board-performance informa-
in its recruitment and retention plans.
tioneven though we know these efforts make
surprising to learn
effect on board-member
engagement.
One of the most important and interesting new

themes of board research focuses on the unique
a difference
How do we know they make a difference? In
role of the board chair and the implications of
2007, Texas A&M University researcher William
board-chair effectiveness. Yvonne Harrison and
Brown studied board-development practices and
Vic Murray began this work in the mid-2000s and
linked them to assessments of board member
have since published the initial results in multiple
competence and performance in credit unions.
publications, including the summer 2007 issue
The results have raised the spirits of consultants
of NPQ, which was one of the first to print the
results.6 (Readers are encouraged to review that
others for improving performance. As long as
article for the works key themes and insights.)
the board-development initiative employs a well-
It is not surprising to learn that the board-chair
conceived, systematic approach, it makes no dif-
Several research studies
role has a significant impact on boards and
ference which approach is taken.
their performance (this may be another case in
This finding is consistent with that of research-
of the past decade
which the typical nonprofit executive delivers
ers Patricia Nobbie and Jeffrey Brudney, who
a resounding Duh! to the research world), yet
sought to compare the impact of using the policy
the value of Harrison and Murrays work lies in
governance approach to board development with
its more complete and systematic explanation of
other board-development approaches.10 They, too,
how this pivotal role uniquely influences board
report that the use of a well-developed, systematic
effectiveness.
intervention of any type makes a difference in per-
affirm that there

is a strong positive
relationship between
board effectiveness and
the effectiveness of
nonprofit organizations.
formance. They also found no evidence that one
Assessing and Understanding Board

Effectiveness
approach is likely to achieve better outcomes than
Given the widespread recognition that board
support from a number of nonprofit consultants,
performance is closely related to the effective-
executives, and board leaders. Butto date
ness of nonprofit organizations, many in both the
there remains almost no empirical research about
research and practice worlds have been exam-
the effectiveness of the policy-governance model
ining the question of how best to assess board
or the conditions under which it works more or
effectiveness. A few of the older tools continue
less well.
another. Policy governance has attracted ardent
to be widely used (for example, the early board

assessment developed by Larry Slesinger and the
The Work of the Board
Board Self-Assessment Questionnaire developed
Several recent board studies have begun to
by Douglas Jackson and Thomas Holland), but
examine boards work from a contingency per-
new tools are being developed. Among the most
spective. In the field of organization studies, it
recently published and empirically validated of
is widely accepted that successful organizations
board self-assessment tools is the Governance
(in any sector) vary their design and structure to
Self-Assessment Checklist (GSAC), which Mel
align with the conditions and challenges posed
Gill and colleagues created as a tool for in-depth
by their relevant external environment. Organi-
assessment.8 In addition, as part of the overall
zations seek an appropriate fit, or alignment,
GSAC development process, Gills team devel-
that enables them to best address the demands
oped and validated a shorter tool, the Board
and opportunities posed by these external condi-
Effectiveness Quick Check, which has also
tions. In other words, their design is contingent on
proven to be quite accurate in assessing board
the characteristics of their external environment.
effectiveness. Several research studies of the
Given that most consider boards to be integral to
past decade, including work that Robert Herman
a nonprofits relationship to the external world, it
and I have implemented, affirm that there is a
makes sense that organizational researchers want
strong positive relationship between board
to understand how board design and roles might
effectiveness and the effectiveness of nonprofit
vary according to the nature of an organizations
organizations.9
external conditions.
An interesting by-product of the Gill teams
In 2010, Ostrower and Melissa Stone pub-
research came from its effort to assess the com-
lished one of two studies examining the relation-
parative value of various board-development
ship between external conditions (for example,
models. The team found that well-designed board-
funding source characteristics), internal char-
development initiatives can be valuable where
acteristics (the size of an organization, for
improving board effectiveness is concerned, but
example, and whether it has a paid chief execu-
there is no specific board-development model
tive), and the roles that boards perform.11 They
or approach that is inherently better than any
found that boards of very large organizations
(i.e., in terms of budget) were likely to be less
the chief executive. In order of importance, the
involved in external roles (community relations,
key roles executives cited were fund develop-
for example) and more involved in internal roles
ment, strategy and planning, financial oversight,
(for example, in financial oversight). They also
public relations, ensuring board vitality, and
reported a link between having a paid chief
policy oversight.
Traditional models
of governance are no
executive and board activity: Boards with paid
As might be expected, the study found that the
CEOs tend to focus their attention on financial
boards of small foundations working in complex
monitoring and CEO performance monitoring,
environments tend to focus more on strategy,
and they tend to be less active in monitoring an
while boards of larger, diversified foundations
agencys programs and services as well as in a
tend to emphasize oversight roles. Interestingly,
boards own performance. For nonprofits that
boards of foundations that have chief executives
new, complicated
do not have paid chief executives, a larger share
with long tenure focus less on oversight. Notable
of the boards is actively involved in program
but perhaps not surprising, boards of agencies in
environments.
monitoring, but even for these organizations,
limited-resource environments tend to be more
less than half (43 percent) engage in such moni-
actively engaged in resource development roles.
longer resilient enough

to be effective in these
toring. Perhaps not surprisingly, Ostrower and

levels of government funding and greater board
Bigger Than Boards: Governance Across

Boundaries
activity in external relations (and also in the
One of the interesting new developments in
extent to which an organization uses monitor-
research on nonprofit boards and governance is
ing practices such as those prescribed in the
the emergence of several studies that examine
Sarbanes-Oxley Act legislation). They found
unique kinds of governance, including those that
that boards of agencies that are highly reliant
cross organizational boundaries. These studies
on funding from earned income (fees) were
are designed to help us understand how mul-
more active in implementing internal monitor-
tiple organizations and networks of organiza-
ing roles.
tions (including organizations from different
Stone found a strong correlation between higher
Importantly, in 2007 board researcher Chao
sectors, such as government and nonprofit) are
Guo examined in greater depth the impact of
engaged together in governance processes that
government funding on patterns of nonprofit
blur and cross organizational (and even sectoral)
governance.12 This timely study highlighted the
boundaries. Much remains to be learned about
complexities of the nonprofit-government rela-
this new frontier of governance, and the possi-
tionship. Government funding places additional
bilities for new forms of governance behavior
demands on nonprofits and has significant impli-
are intriguing.
cations for the work of the board. As more and
As communities work on complex and dynamic
more nonprofits perceive growth in government
issues that cannot be addressed effectively by
funding as a positive option, this study offers
individual organizations, these phenomena take
important perspective and caution.
different forms in different settings. Some forms
In another contingency-oriented study, Brown
look like collaborations and alliances, some like
and Guo examined the roles that community
layers of organizations that are nested within
foundation boards play, and how these roles vary
other larger and more extensive organizations,
under different conditions. The study relied on
and some are networks of multiple organizations.
information from a survey of chief executives
For example, Canadian researcher Patricia Brad-
who were asked which board roles were most
shaw has written about the emergence of systems
important to them. Brown and Guo then exam-
of nested governance to describe the layers of
ined how these roles differed when related to
governance activity that sometimes develop in
environmental uncertainty, the degree to which
federated and distributed organizations and net-
the organization was complex (i.e., had many
works.14 Traditional models of governance are no
different programs), and the relationship with
longer resilient enough to be effective in these
13
new, complicated environments, she asserts, and
Board effectiveness makes a difference in
these new, messier forms of governance emerge
organizational effectiveness, and boards can
to meet the needs of systems that are more politi-
be developed to perform more effectively.
There are board-member
cized, complex, and conflict ridden.
Furthermore, board development does make
and board-development
tant set of studies to examine the governance
Stone and colleagues have begun an impor-
a difference in both board and nonprofit

performance.
dynamics that emerge when sets of community
There are board-member and board-develop-
organizations (nonprofits as well as local and
ment practices that have the potential to make
state government organizations) come together
a significant difference, but way too few of us
to address a complex set of transportation chal-
are using them to help our boards grow and
lenges and needs. Governance becomes much
perform. In particular, we have some work
but way too few of
more complicated and dynamic in such settings,
to do regarding practices for enhancing and
us are using them to
and these cross-sector relationships require some
capitalizing on the value of board diversity and
very different forms of governance.15 I have found
strategies for true community engagement.
help our boards
similar results in my own analyses of governance
Board work is changing, and there will con-
processes in multi-organizational alliances and
tinue to be changes in the operating environ-
grow and perform.
networks of service delivery (as I have reported
ment of the nonprofit world. There are better
in past issues of NPQ), and have found that the
and worse ways to organize, yet there is no
work of individual agency boards can change
single best model or form. Effective boards
quite significantly in these situations. In fact,
will invest time on a regular basis to reconsider
practices that have

the potential to make
a significant difference,
the entire governance process is very different
what they do and how they do it.
(and can be confusing) for those who serve on
Environment matters to board design and prac-
boards of agencies that experience this refram-
tice, and the environment of government and
ing, as their agencies work together to address
its funding can make a critical difference. The
more effectively the most dynamic and complex
boards of nonprofits that contract with govern-
of community needs.16
ment to deliver services are experiencing very
This research niche is small but growing,
significant stresses and challenges, some of
largely because there is significant growth in the
which may threaten their capacity to govern
use of these more complicated forms of organi-
the organization effectively.
zation. Furthermore, as boundaries continue to
As always, theres so much left to learn! Among
blur between nonprofit and governmental activ-
other things, wed still like to know more about
ity, the range of questions about board work and
(1) the effectiveness of various models of board
the very meaning of governance will continue
design, including but not limited to the policy gov-
to grow.
ernance model;(2) the appropriate mix of valueadding board functions and roles as nonprofits
So What Are We Learning?
become more enmeshed in extensive alliances,
Thus, we arrive at the fundamental question: What
networks, and other collaborative ventures (i.e.,
does any of this mean? I offer the following as a
the effects of these factors on governance);(3)
few of the insights I have drawn from the current
whether, as many nonprofits seek to become
generation of board research:
increasingly entrepreneurial, there are gover-
It is both useful and important to draw a clear
nance-related differences relevant to governance
distinction between the function of gover-
in the work of boards of more- versus less-entre-
nance and the work of boards. The work of
preneurial nonprofits;and (4) alternative models
governance is no longer necessarily synony-
and approaches to governance, and the strengths
mous with the boundaries of any individual
and weaknesses of each (i.e., which frameworks
nonprofit board, and even when it is, the align-
can best help us understand our options).
ment of the two constructs is not as simple as

it once appeared to be.
As nonprofit researchers and leaders continue to work closely together to share questions,
challenges, and insights, the opportunities to
10. Patricia Nobbie and Jeffrey Brudney, Testing the
develop the next generation of innovative and
Implementation, Board Performance, and Organiza-
effective governance alternatives are better
tional Effectiveness of the Policy Governance Model
than ever. This is good news, because the stakes
in Nonprofit Boards of Directors, Nonprofit and Vol-
have grown ever larger as nonprofits continue to
untary Sector Quarterly 32, no. 4 (2003): 571595.
play a pivotal role in sustaining and building our
11. Ostrower and Melissa M. Stone, Moving Gov-
communities.
ernance Research Forward: A Contingency-Based

Framework and Data Application, Nonprofit and
N otes
Voluntary Sector Quarterly 39, no. 5 (2010): 901924.
1. Francie Ostrower, Nonprofit Governance in
12. Chao Guo, When Government Becomes the Prin-
the United States: Findings on Performance and
cipal Philanthropist: The Effect of Public Funding on
Accountability from the First National Representa-
Patterns of Nonprofit Governance, Public Adminis-
tive Study (Washington, DC: Urban Institute Center
tration Review 67, no. 3 (2007): 456471.
on Nonprofits and Philanthropy), 2007, www.urban
13. Brown and Guo, Exploring the Key Roles for
.org/publications/411479.html.
Nonprofit Boards, Nonprofit and Voluntary Sector
2. Ostrower, Boards of Midsize Nonprofits: Their
Quarterly 39, no. 3 (2010): 536546.
Needs and Challenges (Washington, DC: Urban Insti-
14. Patricia Bradshaw, The Dynamics of Nested
tute Center on Nonprofits and Philanthropy), 2008,
Governance in Nonprofit Organizations: Preliminary
www.urban.org/publications/411659.html.
Thoughts, presented at the Networks, Stakeholders,
3. Bradley Wright and Judith Millesen, Nonprofit
and Nonprofit Organization Governance conference
Board Role Ambiguity: Investigating Its Prevalence,
hosted by the Midwest Center for Nonprofit Leader-
Antecedents, and Consequences, American Review
ship, University of MissouriKansas City, and NPQ,
of Public Administration 38, no. 3 (2008): 322338.
April 2627, 2007.
4. William Brown, Board Development Practices and
15. Stone, Barbara Crosby, and John Bryson, The
Competent Board Members: Implications for Perfor-
Design and Implementation of Cross- Sector Collabo-
mance. Nonprofit Management and Leadership, 17,
rations: Propositions from the Literature, Public
no. 3 (2007): 301317.
Administration Review, Special Issue, December
5. Sue Inglis and Shirley Cleave, A Scale to Assess
2006, 4455.
Board Members Motivations in Nonprofit Organiza-
16. Renz, Reframing Governance, The Nonprofit
tions, Nonprofit Management and Leadership 17,
Quarterly 17, no. 4 (winter 2010): 5053.
no. 1 (2006): 83101.

6. Yvonne D. Harrison and Vic Murray, The Best and
Worst of Board Chairs, The Nonprofit Quarterly 14,
no. 2 (summer 2007): 2429.
7. Larry H. Slesinger, Self-Assessment for Nonprofit

Governing Boards (Washington, DC: National Center
for Nonprofit Boards, 1996);Douglas K. Jackson and
Thomas P. Holland, Measuring the Effectiveness of
Nonprofit Boards, Nonprofit and Voluntary Sector
Quarterly 27, no. 2 (1998): 159182.
8. Mel Gill, Robert J. Flynn, and Elke Reissing, The
Governance Self-Assessment Checklist: An Instrument
for Assessing Board Effectiveness, Nonprofit Management and Leadership 15, no. 3 (2005): 271294.
9. Robert D. Herman and David O. Renz, Doing Things
Right and Effectiveness in Local Nonprofit Organizations: A Panel Study, Public Administration Review
64, no. 6 (November-December, 2004): 694704.
governance
Financial Transactions with Your Board:
Who Is Looking?
by Francie Ostrower, PhD
Organizations that
have financial
transactions with
their board members
walk a fine line where
public accountability
is concerned, but the
practice turns out to
be widespread.
Excerpted from
in the United
States: Findings on
Performance and
Accountability, author
Francie Ostrower
explores the benefits
and liabilities that
arise when nonprofits
purchase goods and
services from board
members.
Editors note: This article was first published in NPQs summer 2008 edition, and is largely excerpted
from the Urban Institutes report Nonprofit Governance in the United States: Findings on Performance
and Accountability from the First National Representative Study.1 The full report is available at
www.urban.org/url.cfm?ID=411479.
n recent years, policy-makers, the media, and
organizations of varied size, type, and location
the public have increasingly focused on the
participated in the study, making it the largest
accountability of nonprofit boards. Legislative
sample studied to date. The survey covered an
reforms have been proposed, nonprofit asso-
array of topics but focused on practices related
ciations have called on their members to review
to current policy proposals and debates. This
and strengthen nonprofit governance practices,
focus is in keeping with one of the Urban Institute
and the Internal Revenue Service has released
studys primary goals: to draw attention to the links
Governance and Related Topics501(c)(3)
between public policy and nonprofit governance.
Organizations, which includes a series of good-
In considering nonprofit governance, we have
governance recommendations. Accordingly, non-
to ask not only whether nonprofit boards have
profits face pressure to become more accountable
mechanisms in place to avoid malfeasance but
and transparent to their communities, their con-
also whether they actively serve an organizations
stituencies, and the public, which in turn has had
mission. These issues are clearly applicable to
a profound impact on nonprofits internal discus-
the controversial area of financial transactions
sion about appropriate board roles and policies.
between nonprofits and the members of their
It is critical that both proposed policy reforms
boards of directors, one of the topics covered in
and best-practice guidelines be informed by solid
the Urban Institutes broader report.
knowledge about how boards currently operate

formance. To help ensure the availability of such
Financial Transactions between Nonprofits

and Board Members
knowledge, in 2005 the Urban Institute conducted
Under the law, board members owe a nonprofit a
the first-ever national representative study of
duty of loyalty, which requires them to act in a non-
nonprofit governance. More than 5,100 nonprofit
profits best interest rather than in their own or in
and which factors promote or hinder their per-
anyone elses. The IRSs Governance and Related

F rancie O strower , P h D, is a professor at the Lyndon B.
Topics cautions that in particular, the duty of
Johnson School of Public Affairs and the Department of
loyalty requires a director to avoid conflicts of
Theatre and Dance, and director of the Portfolio Program
interest that are detrimental to the charity. Against
in Arts and Cultural Management and Entrepreneurship,
this background, nonprofits purchase of goods and
University of Texas at Austin.
services from board members or their companies
P H OTO G R A P H : P E E P S H O W
Figure 1
Percentage of Organizations Obtaining Goods or Services Below and at Market Rates from Board Members
(Organizations involved in Financial Transactions Only)
Below-market rates
100%
IRSs guidelines are emphatic on this point. They

call on boards to adopt and regularly evaluate
a written conflict of interest policy that, among
other things, includes written procedures for
Market rates
determining whether a relationship, financial interest, or business affiliation results in a conflict of
80%
interest and specifies what is to be done when it
60%
does.6 Further, the IRS has instituted a question on

its Form 990 asking nonprofits whether they have
40%
a conflict-of-interest policy in place.
20%
Results from the Urban Institutes survey
0%
shed light on (1) the scope of such transactions;
< $100K
$100K$500K
$500K$2M
$2M$10M
$10M$40M
$40M+
Expenditure Level
SOURCE: 2005 Urban Institute National Survey of Nonprofit Governance
(2) whether these transactions provide claimed

benefits for nonprofits; and (3) how nonprofits
current practices measure up to conflict-of-interest standards from the IRS and others.
raises special concerns about whom such transacone state attorney generals office warns that
Frequency and Consequences of

Financial Transactions
caution should be exercised in entering into any
According to respondents self-reports, financial
business relationship between the organization and
transactions between organizations and board
a board member, and should be avoided entirely
members are extensive, particularly among
unless the board determines that the transaction
large nonprofits. Overall, 21 percent of nonprof-
is clearly in the charitys best interest.3
its reported buying or renting goods, services,
tions really benefit. In a guide for board members,
According to
respondents selfreports, financial
In 2004 a proposal to restrict nonprofits ability
or property from a board member or affiliated
to engage in these transactions was included in the
company during the previous two years. Among
Senate Finance Committees draft white paper but
nonprofits with more than $10 million in annual
members are extensive,
met considerable opposition from some nonprofit
expenses, however, the figure climbs to more than
representatives. The president and CEO of Indepen-
41 percent.7 But also note that among nonprof-
particularly among
dent Sector, for instance, warned that prohibiting
its that say they did not engage in transactions
economic transactions could be extremely detri-
with board members or affiliated companies,
mental to a number of charities.... Public charities,
75 percent also say they do not require board
particularly smaller charities, frequently receive
members to disclose their financial interests in
from board members and other disqualified parties
entities doing business with the organization. In
goods, services, or the use of property at substan-
effect, respondents may be unaware of transac-
tially below market rates. The executive director
tions that have taken place.
transactions between
organizations and board
large nonprofits.
of the National Council of Nonprofit Associations,
According to respondents, among the 21
which is composed primarily of smaller and midsize
percent of nonprofits that engaged in financial
nonprofits, voiced a similar objection.4 There has
transactions with board members or related
also been concern about the impact on nonprofits
companies, most obtained goods at market value
in rural and smaller communities, where a trustees
(74 percent), but a majority (51 percent) report
law firm or bank may be the only one in the area.5
that they obtained goods at below-market rate.
But whether public charities should or shouldnt
Less than 2 percent reported paying above-market
be allowed to engage in financial transactions with
cost.8 Keep in mind too that these are self-reports,
board members, there is agreement that such
so if anything, the figures are likely to u

nderreport
transactions should be transparent to boards and
transactions resulting in obtaining goods at above-
that policies should be in place to ensure that such
market value or at market value and to over
transactions are in a nonprofits best interest. The
report transactions resulting in obtaining goods
at below-market rate.
Among nonprofits that engaged in financial
transactions with board members, small non-
Figure 2
Policies of Organizations that Purchased or Rented Goods or Services from Board Members or Associated Companies
100%
profits were considerably more likely than large
80%
ones to obtain goods and services from board
60%
members at below-market cost: 58 percent of

nonprofits with less than $100,000 in expenses
40%
obtained goods or services at below-market rate
20%
from a board member, but the percentage drops to
0%
a low of 24 percent among nonprofits with more
< $100K
$100K-$500K
$500K-$2M
$2M-$10M
$10M-$40M
$40M+
Expenditure Level
than $40 million in expenses (see figure 1). In con-
Board members reviewed and approved these transactions
trast, the percentage of nonprofits that received
Have a written conflict of interest policy
goods or services at market value was more than
Board members required to disclose financial interests
70 percent for each size group.9 The percentage

reporting they obtained goods at above-market
SOURCE: 2005 Urban Institute National Survey of Nonprofit Governance
value was less than 3 percent for each size group.10

The study also found no evidence that bans on
transactions with board membersdo not meet
financial transactions would disproportionately
the standards laid out by the IRS and other good-
affect rural nonprofits. There was no significant
governance guidelines. But the majority of non-
difference between nonprofits inside and outside
profits engaged in such transactions (82 percent)
metropolitan statistical areas either in the per-
report that other board members had reviewed
centage engaged in financial transactions or in the
and approved the transactions beforehand.
perception of how difficult it would be for them

were such transactions prohibited.
Substantial variations among respondents do
Substantial percentages
of nonprofits do not
exist by size (see figure 2). Larger nonprofits are
meet the standards

laid out by the IRS
Forty-five percent of nonprofits that engaged in
more likely to have a written conflict-of-interest
business transactions with trustees said it would
policy. Among those engaged in financial trans-
be at least somewhat difficult were they prohib-
actions, almost all nonprofits with more than
and other good-
ited from purchasing or renting goods from board
$40 million in expenses have a written conflict-
members, but only 17 percent said it would be very
of-interest policy (97 percent), but the figure
governance guidelines.
difficult. Percentage differences by size were not
decreases to only 30 percent among nonprofits
statistically significant. As one would expect, the
with less than $100,000. Financial disclosure
comparable figures rise among those who obtained
requirements also vary considerably by size.
goods or services at below-market rate. Fifty
Among nonprofits engaged in financial transac-
percent said it would be at least somewhat dif-
tions with board members or associated com-
ficult, and 19 percent said it would be very difficult.
panies, the percentage that requires disclosure

ranges from a low of 18 percent among the small-
Policies to Regulate Financial Transactions and

Conflicts of Interest
est nonprofits to a high of 96 percent of nonprofits
Among all respondents, only half had a written
Substantial minorities in the $2-million to $40-
conflict-of-interest policy, and only 29 percent
million size categories and majorities in all groups
required disclosure of financial interests. Among
of less than $2 million do not require disclosure.
nonprofits that reported financial transactions
Although formal policies are more common
with board members, 60 percent have a conflict-
among larger nonprofits, smaller nonprofits are
of-interest policy, and 42 percent require board
more likely to report that other board members
members to disclose the financial interests they
reviewed and approved transactions. Ninety
have in companies that do business with the non-
percent of nonprofits with less than $100,000 had
profit. As we can see, substantial percentages of
other board members review transactions before-
nonprofitsincluding those engaged in financial
hand, but the figure declines to 66 percent among
with more than $40 million in annual expenses.
those in the more-than-$40-million category. In
on Nonprofits and Philanthropy, June 25, 2007), www
the case of smaller nonprofits, one issue is that
.urban.org/url.cfm?ID=411479.
while board members may review transactions,
2. Editors note: The IRS originally released its rec-
they often lack written guidelines to inform their
ommendations in the draft paper Good Governance
review. Among larger nonprofits that have formal
Practices for 501(c)(3) Organizations (www. irs
policies, significant percentages of nonprofit
.gov/charities/article/0,,id=178221,00.html), cited
boards do not review transactions beforehand
in the original Urban Institute report. The IRS has
engaged in buying
to ensure that formal policies have been met.
now replaced the paper on its website with Gover-
or renting goods and
Conclusions and Implications
The new IRS paper offers many of the same gover-
services from board
Our findings demonstrate that substantial varia-
nance recommendations (www.irs.gov/pub/irs-tege
members, which
tions in boards exist among nonprofits of differ-
/governance_practices.pdf).
ent types. Given that variation, those proposing
3. Web page of the New Mexico Attorney General
sometimes yields
policy initiatives and good-governance guide-
(www . ago . state . nm . us / divs / cons / charities /
lines to strengthen nonprofits should assess the
nmboardguide.htm).
savings in terms of
different impact on various types of nonprofits
4. Comments on Discussion Draft on Reforms
and weigh them carefully. So, for example, our
to Oversight of Charitable Organizations (www
research supports the argument that prohibiting
.independentsector.org/PDFs/roundtable.pdf). See
financial transactions with board members would
also the statement submitted by Audrey R. Alvarado,
disproportionately hurt small nonprofits.
executive director of the National Council of Non-
Our findings show that

many nonprofits are
below-market rates
but more often, it
does not.
nance and Related Topics501(c)(3) Organizations.
Our findings show that many nonprofits are
profit Associations, to the Senate Finance Commit-
engaged in buying or renting goods and services
tee, which cautions against the undue hardship for
from board members, which sometimes yields
small and medium-size nonprofits, July 21, 2004 (www
savings in terms of below-market ratesbut
.senate.gov/~finance/Roundtable/Audrey_A.pdf).
more often, it does not. Our findings do not tell
5. See, for example, Marion R. Fremont-Smiths com-
us whether these practices are in the best interest
ments to the Senate Finance Committee, July 13, 2004
of a nonprofit, but they strongly confirm that this
(www. senate. gov/ ~finance/ Roundtable/ Marion_ F. pdf).
is an important area in which appropriate policies
6. www.irs.gov/pub/irs-tege/governance_practices.pdf.
and procedures need to be in place. Smaller non-
7. By size categories, the percentages are as follows:
profits that engage in financial transactions need
less than $100,000: 15 percent; $100,000 to $500,000: 18
to have more formal mechanisms in place to regu-
percent; $500,000 to $2 million: 27 percent; $2 million
late transactions, and larger organizations need
to $10 million: 34 percent; $10 million to $40 million:
to institute practices more frequently in which
42 percent; and more than $40 million: 45 percent.
board members unrelated to these transactions
8. Percentages exceed 100 because nonprofits could
review transactions for appropriateness. Further-
engage in multiple financial transactions with board
more, research is needed to examine the content
members so that any organization could report up to
of these policies and procedures and whether
three categories.
they are adequate to ensure that transactions do
9. Ostrower, Nonprofit Governance in the United
not undermine board members duty to act in an
States. Note that percentages obtaining goods at
organizations best interest and to help inform
market rates and below-market rates exceed 100
policy proposals and best-practice guidelines
because nonprofits could engage in multiple financial
aimed to achieve that goal.
transactions with board members, and therefore any

nonprofit could report in both categories.
N otes
10. Ibid.
1. Francie Ostrower, Nonprofit Governance in
the United States: Findings on Performance and
Accountability from the First National Representa-
tive Study (Washington: DC: Urban Institute Center
Findings to which you should PAY ATTENTION!

It distresses us to see so few practitioners taking advantage of research when making decisions about their
boards. Ostrowers study provides many informational jewels for the wise practitioner. For instance:
One of the most essential roles of the board

is to fundraise!
may be less attentive to oversight duties. While large

board size may contribute to problems at some nonprof-
There were only two activities that over half of all respon-
its, our findings do not indicate that larger board size per
dents said their boards were very actively engaged in
se detracts from board engagement. Indeed, to the extent
and even these were only slight majorities: 52 percent said
that it had any association with activity levels (and usually
their boards were very actively engaged in financial over-
it did not), it was a positive one: board size was positively
sight, and 52 percent said they were very active in setting
associated with board activity in fundraising, educating the
organizational policy. Only a minority of boards were very
public about the organization and its mission, and trying to
involved when it came to most of the activities we asked
influence public policy.
about, including fundraising (29 percent). Most respondents rated their boards as doing a good or excellent
Compensating board members: yea or nay?
job in all areas except fundraising.
Nonprofits in our study rarely reported compensating board

membersonly 2 percent did so. The percentage is higher
What about including our executive

on the board?
among larger nonprofits, reaching to 10 percent among non-
The practice of including the executive director as a voting
to compensate was also higher among health organizations
board member is less common on nonprofit boards than
(4 percent) than nonprofits in other fields (2 percent). Bear
on corporate boards, but we did find the practice among a
in mind that this study was confined to public charities and
substantial minority (33 percent) of respondents, includ-
does not include private foundations (which more often
ing 21 percent of those with a paid CEO/executive direc-
compensate). Boards that compensate were not more or
tor. Having the CEO/executive director serve as a voting
less likely to be actively engaged in financial oversight,
board member was negatively related to board activity
setting policy, planning, monitoring programs, or evaluat-
level in financial oversight, setting policy, community rela-
ing the CEO/executive director. They were not more or less
tions, and trying to influence public policyand positively
likely to evaluate whether the organization was achieving
related to none.
its goals at least every two years. Compensation was nega-
profits with over $40 million in expenses. The propensity
tively associated with levels of board activity in fundrais-
How big is too big?
ing, community relations, and educating the public about
Our analyses yielded an interesting finding about one board
the organization and its mission. Boards that compensate
attribute that has been the subject of some controversy
their members were more likely to be active in trying to
board size. Large board size has been cited as contributing
influence public policy, but this relationship disappeared
to governance failures in some of the more highly publi-
with controls for other variables. However, compensation
cized scandals at nonprofits, and occasionally proposals
was positively associated with attendance at board meet-
have been floated to impose an upper limit. The IRS draft
ings, and this relationship held even after controls for other
guidelines propose no limits but caution that large boards
variables.
governance
Sarbanes-Oxley: Ten Years Later

by Rick Cohen
Although the
Sarbanes-Oxley
Act was aimed
at corporations,
elements have crept
Congress passed
Based on the two tiny components of a sixty-six-
the Sarbanes-Oxley Act (SOX) in response to
page statute, though, the nonprofit sector has little
the meltdown of the Enron Corporation and
to worry about and actually much to gain.
t was only a decade ago that
the Arthur Andersen accounting firm. The
Section 1107 of the statute makes it a crime
two official names of the legislationthe Public
for a nonprofit to retaliate against an employee
Company Accounting Reform and Investor Pro-
who provides a federal law enforcement officer
sector, creating
tection Act (in the Senate) and the Corporate and
with truthful information about a nonprofits
an ethos in the
Auditing Accountability and Responsibility Act (in
having committed or planned to commit a federal
the House of Representatives)tell you where
offense. In truth, the provision has relatively
Congress was focused: on publicly traded corpo-
limited application, yet it generated a wave of
rations and the accounting practices necessary
reaction among nonprofits. Nonprofit executives
for protecting investors.
and boards probably feel just as uncomfortable
into the nonprofit
nation and within

the nonprofit
Sarbanes-Oxley wasnt aimed at the non-
as corporate players do with colleagues blowing
profit sector and contained almost no legislative
the whistle. In fact, some academic and legal lit-
language applicable to nonprofits. While trade
erature describe whistleblowers as disgruntled
associations in the corporate sector have loudly
employees or troublemakers rather than virtu-
bemoaned the burdens SOX imposed on corpora-
ous characters exposing organizational wrong-
of governance,
tions, Sarbanes-Oxley survives. Despite corporate
doing, and includes advice from legal experts
particularly that
complaints, SOX has become part of the land-
often focused on how to deal with rather than
scape of corporate governance writ largefor
protect the troublemakers. But interest in the
carried out by the
publicly owned corporations and, by absorption,
plight of whistleblowers has not abated. This past
nonprofit board.
for 501(c)(3) public charities, which have seen
November, Congress passed the Whistleblower
the value of a more rigorous regime of improved
Protection Enhancement Act, strengthening the
corporate governance practices.
provisions to safeguard legitimate whistleblow-
sector, restoring
and elevating
the importance
ers and broadening the range of issues covered
What the Law Requires
by federal legislation. Still, the act is focused on
Only two provisions of Sarbanes-Oxley apply to
federal whistleblowers, not nonprofit ones.
nonprofits: retaliation against whistleblowers and
Are nonprofit whistleblowers important?
destruction of documents that could be used in an
Ask the ProPublica and Frontline investigative
official investigation. But this didnt stop nonprof-
team that in 2012 was able to reveal the sources
its from worrying that more of the law would seep
of secret money behind the social welfare orga-
from public corporations into the nonprofit sector.
nization Western Tradition Partnership (WTP),

eventually uncovering alleged illegal coordina-
R i c k C o h e n is the Nonprofit Quarterlys national
tion between the purportedly independent WTP
correspondent.
and a number of candidates for political office.
Sometimes nonprofit whistleblower issues arent

large compared to such massive corporate malfeasance as was discovered when Sherron Watkins
blew the cover of Exxons illegal operations, but
the ability to speak up about wrongdoing within
nonprofits is a critical element of good governance in the sector. Nonetheless, as Louis Clark
of the Government Accountability Project told
NPQ, much of the nonprofit sector doesnt get
whistleblower coverage, even when nonprofits
are dealing with some parts of the federal bureaucracy. Although the stimulus legislation, which
went through a number of nonprofit groups, built
in whistleblower protections for vendors and contractors, other federal problems might not cover
nonprofit vendors. SOX opened up the culture
of whistleblowing to the nonprofit sectoror,
perhaps more accurately, within the nonprofit
sectorbut the nation is still far from providing
appropriate and necessary protections to nonprofit whistleblowers.
The other element of the statute that specifically applies to nonprofits is Section 1102, which
makes it a crime for nonprofits to alter or destroy
documents that should be maintained for use in
official proceedings. It also makes it a crime to
impede or obstruct such official proceedings.
The legislation adds the qualifier corruptly to
the prohibition, without explaining what exactly
corruptly means. In any case, the destructionof-documents language in SOX has led many nonprofits to adopt specific policies detailing which
documents must be kept and for how long.
Theres no easy answer, however, to the length
of time a given document should be kept. Some
documents may have lengths of time established
by state or federal statutes or regulations; others
by virtue of business needs that could go beyond
anything established in the law, or that could vary
by the type of business activity the nonprofit is
pursuing; and still others based on historical
or intrinsic purposes. In light of recent federal
investigations into the e-mail correspondence of
top Pentagon and CIA officials, nonprofits should
keep in mind the broad scope of documents that
ought to be retained.
And retaining documents may be just as important to nonprofit employees as to the employers.
P H OTO G R A P H : S E N T R Y
There was, of course,

pushback against the
application of SOX
best practices to
The obvious parallel is in the government. Scores
This is still a big challenge for smaller non-
of veterans of U.S. military action in Iraq and
profits, but the emphasis on bringing in someone
Afghanistan recently discovered that they cannot
with financial expertise to do battle with the
receive benefits for their overseas deployments
auditors is considered good practice. It is no
because of lost or missing U.S. Army records from
longer sufficient for a nonprofit CEO or execu-
around 2004 to 2008. This serves as a reminder
tive committee to wheedle with auditors to get
that nonprofit organizations are gatherings of
clean audits with nothing of substance in the audi-
people, and it is these people whistleblower and
tors management letter. Opening up the process
document retention policies serve to protect.
to an audit that gets translated through an audit

committee, sometimes over the discomfort of an
the nonprofit sector;
The Sarbanes-Oxley Ethos
organizations CEO and financial committee, is
and, not surprisingly,
Almost immediately upon the laws passage, the
a major step toward nonprofit accountability. In
U.S. Chamber of Commerce and other business
fact, nonprofits, unlike their for-profit corporate
it emerged sounding
associations launched a widespread assault on
brethren, sometimes now welcome the opportu-
the legislation and its potential negative impact
nity to receive a management letter, and make
much like the
on corporate business practices and profits. That
it available with the auditors recommendations
is the sort of reflexive response of business in
and the nonprofits specific ameliorative actions.
general to any enacted or pending regulatory
The letter becomes a mark of strength, account-
requirement, but SOX hardly did in the corpo-
ability, and self-improvement. It also sometimes
rate sector. In fact, for much of the decade after
means, in accordance with the public corporation
the enactment of the law, the corporate sector
requirements of Sarbanes-Oxley, a regular review
fared exceptionally well until overly rapacious
and replacement of the auditors themselves.
corporate critique
of the legislation.
banks and investment houses did in the economy
On the corporate side, the law went further,
in 2008due in part to inadequate government
limiting or prohibiting the services that an
regulation and oversight.
auditor might deliver. All too often, auditors were
The corporate hysteria about SOX concerned
also providing bookkeeping services, investment
Section 404 of the law, which calls for indepen-
advice, and other functions that really had no
dent auditors to examine and certify the adequacy
relationship to their functions as independent
of corporations internal controls and financial
auditors, and sometimes compromised the integ-
reporting. This was deemed to be an expensive
rity and reliability of the audits. It is easy to see
new proposition, with studies emerging indicating
why that might happen in a smaller nonprofit,
that corporations were facing hugely increased
too. An auditor will see a problem, recommend a
operating costs due to SOX compliance. With
solution, and be the logical entity to help the non-
the downturn in the economy and challenges in
profit client carry it out, but with the result that
the world of business competition, the corporate
the auditors judgment could be clouded by self-
drumbeat against the presumed additional costs of
interest. Avoiding conflicts of interest doesnt
corporate compliance with SOX remains strong.
mean being shortsighted about logical efficien-
Regardless of the corporate thinking, some ele-
cies. It makes perfect sense for the auditor to
ments of SOX as good practice seeped into the
have a role in the preparation of a nonprofits
nonprofit sectorone significant area being the
Form 990s and other tax documents. Similarly,
restructuring of nonprofit boards financial com-
since an auditor should be sharply focused on
mittees. Increasingly, following the SOX corpo-
an organizations financial controls, helping to
rate model, nonprofits established separate and
design the controls to protect and enhance non-
independent audit committees and even tried to
profit accountability also makes sense.
recruit financial experts. States began creating
There was, of course, pushback against the
laws with financial thresholds that would require
application of SOX best practices to the non-
the establishment of audit committees and, con-
profit sector; and, not surprisingly, it emerged
sequently, audits.
sounding much like the corporate critique of the
legislation. Nonprofit leaders suggested that the
the Pension Protection Act, largely focusing on
movement toward requiring audits for smaller
addressing abusive donor-advised funds and sup-
organizationsthough the revenue thresholds
porting organizations and some technical issues
established in most state laws made the audit
concerning charitable deductions. Nonetheless,
requirement applicable to nonprofits that were
SOX created an ethos in the nation and within the
clearly in the top 10 percent or even top 5 percent
nonprofit sector, restoring and elevating the impor-
of nonprofits based on annual revenueswould
tance of governance, particularly that carried out
create additional compliance costs that, unlike
by the nonprofit board. Many boards and their
in for-profit circumstances, could not be easily
partner CEOs still operate as though best prac-
absorbed or passed along to customers or users.
tices in good governance were an alien imposition.
in good governance
Even some larger nonprofits operate on bare-
But unlike the pre-SOX era, in which governance
bones financial structures, with minimal operat-
was sold to the nonprofit public simply as some-
were an alien imposition.
ing reserves, constrained overheads, and little
thing innately good, SOX put good governance and
But unlike the pre-SOX
financial flexibility. Adding the requirement of
board oversight into the public policy parlance.
era, in which governance
audits, as powerful as they are in establishing the
After decades of management professionals
veracity of a nonprofits finances and controls,
training boards and staff about the necessary
could mean taking money away from the delivery
functions of boards of directors, SOX underscored
of crucial services.
that nonprofit board membership was not to be
Many boards and their

partner CEOs still operate
as though best practices
was sold to the

nonprofit public simply
Concerned that extra costs could force non-
looked at as a frivolous, resume-burnishing activ-
profits out of business, some nonprofit leaders
ity. In other words: board members are supposed
also suggested that the SOX origins in the cor-
to know what the organizations they oversee
good, SOX put good
porate sector, particularly with the predatory
are actually doing; fiduciary responsibility has
and self-serving actions of Enrons Kenneth
meaning and consequences for board members;
governance and board
Lay, Jeffrey Skilling, and Andrew Fastow, were
there is a relationship between good governance
oversight into the
unlikely to be issues for the nonprofit sector. Lay,
and organizational effectiveness; and, with the
Skilling, and, particularly, Fastow used Enrons
new public ethos of SOX, institutional funders
public policy parlance.
lack of controls to enrich themselves through
and individual donors should be legitimately con-
stock options and complex financial structures
cerned with and attentive to nonprofit governance.
that most nonprofits couldnt even fathom, much
Sarbanes-Oxley didnt eliminate the likes of
less try to design or replicate. Corporate audits,
Andrew Fastow preying on the corporations they
if conducted by auditors not in the pockets of the
oversaw, and the 2002 legislation didnt suddenly
executives, would in theory uncover these depre-
make the oversight of the Securities and Exchange
dations; in the nonprofit sector, comparable self-
Commission muscular and effective. The same
enrichment was unlikely to occur. To nonprofits,
holds true for the nonprofit sector. There are still
SOX aimed at uncovering and undoing problems
people of dubious ethics abusing the charitable
in the corporate sector that were at most hardly
sector, and effective oversight and enforcement
pervasive among nonprofits and more than likely
from state attorneys general are spotty and even
all but nonexistent.
less in evidence from the overburdened and under-
Although California came out with a Nonprofit
resourced tax-exempt division of the Internal
Integrity Act in 2004, and several states established
Revenue Service. But, despite only two provisions
audit thresholds, there was hardly a widespread
of specific applicability to the nonprofit sector,
replication of SOX for nonprofits at the state level.
Sarbanes-Oxley did effect a positive change of
Efforts to increase nonprofit accountability at the
context and behavior for nonprofits in the arenas
federal level foundered as the Senate Finance
of governance and financial accountability.
as something innately
Committees investigations in 2004 were channeled into a self-regulatory regime promoted in
the two reports of Independent Sectors Panel
on the Nonprofit Sector, and, in 2006, Title XII of
governance
The Inclusive Nonprofit Boardroom:
Leveraging the Transformative

Potential of Diversity
by Patricia Bradshaw, PhD, and Christopher Fredette, PhD
This article looks
beyond the simple
diversity aspiration
Recognize that diversity brings richness. Diversity brings new ideas. Diversity brings growth.
to a higher plane.
Research shows
that a combination
of functional and
social inclusion
creates what the
Diversity brings dynamism. Diversity brings energy. And lack of diversity means sameness, dullness,
lack of growth.
Interviewed board member

iversity abounds in our communities and
are white (non-Latino); a mere 7 percent are
organizations, and our understanding of
African American or black;and 3.5 percent are
what constitutes diversity continues to
Latino. In a survey of nonprofit boards from
grow as patterns of difference shift, yet
across Canada, conducted in 2008, we found that
in many cases we, and our organizations, struggle
the majority of board members were between
to keep pace with societal trends. While diver-
thirty and sixty years old, and 44 percent were
sity has many aspects, including individual dif-
women. Almost 28 percent of the organizations
transformational
ferences along dimensions such as education or
indicated that there was at least one person with
inclusion, a model
training, personality or style, this article focuses
a disability on their board, while 22.4 percent of
primarily on diversity based on dimensions such
those surveyed had a board member who was
that empowers
as culture, ethnicity, race, age, sexual orientation,
openly lesbian, gay, or bisexual. Only 13 percent of
members using
and gender. We are looking at a particular context
board members were what in Canada are termed
in which such diversity is a concern for many non-
visible minorities, or persons of color.
authors have
come to call
profits, and that context is the boardroom.
functional
While funders and others often seem to be
processes to
The Urban Institutes Francie Ostrower noted
advocating for more representative diversity on
in a national survey of nonprofit governance in the
boards, this has not yet resulted in large shifts in
integraterather
United States that 86 percent of board members
board composition, with the exception of women.
than assimilate
diverse members.
It is likely that you have heard the arguments in

P atricia B radshaw , P h D, is dean of the Sobey School
favor of increasing board diversity, including
of Business at Saint Marys University in Halifax, Nova
the claim that more diversity leads to superior
Scotia, Canada. C hristopher F redette , P h D, is an
financial performance, better strategic decision
assistant professor of management at the Odette School
making, increased responsiveness to community
of Business, University of Windsor, Ontario, Canada.
and client stakeholders, and an enhanced ability
P H OTO G R A P H : H O M AG E
traditionally marginalized communities are
Figure 1: A Typology of Inclusion
present on boards and meaningfully engaged in
Functional Inclusion
HIGH
the governance of their organizations. We also

noted that our informants implied that at times
Instrumental
Inclusion
Transformational
Inclusion
inclusion had potential transformational impacts
Purposeful inclusion of diverse

members for the accomplishment
of a desired outcome
Functional and social

embeddedness enhancing
competencies and capabilities
for the board itself. Kristina A. Bourne similarly
for both traditionally marginalized individuals and

describes an inclusion breakthrough as a powerful transformation of an organizations culture
to one in which every individual is valued as a
vital component of the organizations success and
competitive advantage. Bourne describes this
Relational
Inclusion
concept as an alternative to seeing diversity as
Cohesive interpersonal
relationships resulting from
equality in social standing
tolerated. But her claims, and those of our infor-
Disengagement
LOW
Diversity is neither sought

nor recognized
an end in itself or something to be managed or

mants, have not yet been empirically examined.
Reflecting on our interviews, it seemed that our
informants were talking about two different types
of inclusionwhich we came to call functional
LOW
Social Inclusion
HIGH
inclusion and social inclusionand about how

the two can work together to create something
to attract and retain top talent. But you may also
Reflecting on our
interviews, it seemed
transformational.
have heard that researchers have found a corre-
Functional inclusion emerged from our
lation between increasing diversity among gov-
research as characterized by goal-driven and pur-
erning groups and greater conflict, as well as a
poseful strategies for the increased inclusion of
deterioration in performance.
members of diverse or traditionally marginalized
We too have struggled with these mixed mes-
communities. Social inclusion, in contrast, is best
sages. We wanted to deepen the conversation about
characterized by the participation of members of
diversity on boards through empirical research, in
diverse groups in the interpersonal dynamics and
were talking about
order to better understand the roots of this paradox
cultural fabric of the board, based on meaning-
two different types
and what is being done to respond to demands for
ful relational connections. Unlike the functional
both increased diversity and effectiveness.
notions of inclusion, social inclusion also stresses
that our informants
of inclusion, and
about how the two
can work together
to create something
transformational.
We began by talking to eighteen board members
the value derived from social standing and rela-
from the voluntary sector in Canada who are
tional acceptance within the context of the board.
viewed by their peers to be leaders in the effort
Reflected in this view of relational acceptance is
to diversify boards. We were interested in looking
the need for members of traditionally marginal-
at how they made sense of diversity, and what
ized communities to be authentically engaged as
they saw as the best practices for enhancing it.
whole members of the board, avoiding marginal-
While academics have tended to focus on diversity
ization and alienation.
and the dynamics of exclusion, communities of
We concluded that people were basing their
practice are now talking about inclusion. Our
comments on an implicit model, and we are sug-
informants described inclusion as an alternative
gesting that the combination of both types of
to assimilation, in which all people are treated
inclusion could transform governance and create
the same, or differentiation, where differences
what we have come to call transformational
are celebrated and leveraged with the potential
inclusion (see figure 1).
consequences of tokenism and exclusion.
As figure 1 proposes, the board that focuses
We came to define board-level inclusion as
exclusively on functional inclusion and on
the degree to which members of diverse and
taking a making the business case for diversity
approach will end up with what we are calling
represented on the boards. Our analysis of the
instrumental inclusion. Similarly, boards that
impact of increased diversity on boards supports
focus exclusively on social inclusion end up with
previous research documenting the challenges
what we are calling relational inclusion, a model
of diversity. We found that higher levels of diver-
that tends to make people feel good. Boards
sity were correlated with perceptions on the
that do both instrumental and relational inclu-
part of our respondents of lower levels of board
sion, however, can generate transformational
effectiveness.
It is not enough for

boards to simply add
members from diverse
inclusion. To be really successful, boards of direc-
Previous research similarly indicated that
tors need to empower members using functional
diversity leads to conflict and lower performance
processes, and they must do so while integrating
levels. Fortunately, this is not the end of the story,
(rather than assimilating) diverse members using
but it does tell us that it is not enough for boards
expect positive
social and relational means as well. For these
to simply add members from diverse communities
reasons, we hypothesized that governing groups
and expect positive outcomes to result. Unless
outcomes to result.
that are more diverse and implement function-
meaningful steps are taken to include members
ally and socially inclusive practices will be more
in the functional and social aspects of board life,
effective and have higher cohesion and greater
increasing diversity tends to result in perceptions
commitment than their less diverse counterparts.
of greater conflict and dissatisfaction with board
We decided that this hypothesis deserved to
communities and
performance.
be tested, and developed a questionnaire that
Our study showed that meaningfully engag-
surveyed respondents from 234 boards of direc-
ing diverse members in the social and functional
tors operating in Canadas nonprofit sector. We
aspects of board work attenuates, and in many
measured board diversity by counting the number
cases mitigates, the perceived performance dete-
of ethnocultural and visibly different groups
rioration that occurs when diversity is increased
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along the lines of the functional or social model
pushing for more inclusion of others.
alone. This is an important finding, as it offers
These individuals expressed discomfort at
evidence that diverse governing groups need
rocking the boat and disrupting the status quo, but
If you get the right
not sacrifice board performance for the sake of
they did so intentionally. Some saw how this type
increased diversity. Indeed, functional inclusion
of action could lead to tokenism, where a person
person, that person can
was found to be positively associated with overall
is added to the board primarily because of his or
board effectiveness, cohesion, and commitment,
her difference, or based on quotas or agendas.
while it did little for group cohesion and commit-
This opens the door to such questions as, What
ment. Social inclusion, on the other hand, had
do women think about this? being asked of the
little direct impact on board effectiveness, but
onlyor tokenwoman on a board, based on the
added significantly to group cohesion and com-
faulty assumption that one person can speak for
backfires on the people
mitment. There is a need to balance both social
a whole demographic community. But the infor-
who try to use it.
and functional inclusion, lest boards neglect one
mants also said things like: If you get the right
dimension (social inclusion) in favor of focusing
person, that person can start advocating and then
prominently on the other (functional inclusion).
do something. Sometimes tokenism backfires on
The cumulative implications of diversity
the people who try to use it. Having a seat at the
and inclusion are complex and intertwined, but
table presented diverse board members with an
largely support our general theme that functional
opportunity to advance diversity interests and
and social inclusion enhance the effectiveness
agendas. One person, for example, said:
start advocating and

then do something.
Sometimes tokenism
and viability of governing groups, particularly in

relation to making the more diverse groups effec-
Before I came on the executive board, what was
tive, cohesive, and committed. The (direct and
happening at the board meeting was the execu-
indirect) patterns of relationships that we found
tive would decide what things should come to
between board diversity and board effectiveness
the board, and present them to the board, and
speak to the transformative potential that lies at
the board [always] said yes. The chair thought
the heart of inclusion.
that I would be a nice person to be appointed
Given these findings, what can boards that
to the board, especially because I come from
want to benefit from diversity actually do in order
a diverse community. After about the third
to create more inclusive governing bodies? In the
executive meeting, of course, she said, I am
following sections we describe steps that people
very disappointed in you because, you know,
we interviewed think are useful in building func-
we want executive solidarity. So I said, Youll
tional and social inclusion. These are steps that
never get that as long as Im on the executive
are being enacted by boards as a whole as well
board, you can be surebecause I came on the
as by individual board members who care deeply
board to represent certain views, and you will
about inclusion.
hear about those things.
Functional Inclusion
Functional inclusion at the level of the board
We have characterized functional inclusion as
involves steps taken by the board as a whole to
goal driven and committed to purposeful strat-
increase representation of members of diverse
egies for the increased inclusion of individuals
communities through its policies, structures,
who identify as coming from diverse or tradition-
practices, and processes. One characteristic of this
ally marginalized communities. In the interviews,
approach is to focus on stakeholders and make
individuals who saw themselves as champions of
what we often heard called the business case for
change described many actions that they had per-
diversity. The business case involves assessing
sonally taken to make their boards more inclusive,
the benefits of diversity, and can include consid-
working to get on the board and into positions
erations such as creating greater access and legiti-
of influencesuch as on governance, diversity,
macy for different constituents, helping the board
or executive committeesfor example, and then
appear forward thinking, attracting resources, and
Figure 2: Approaches to Functional Inclusion

Board Policies Addressing Inclusion
Creating board policies related to recruitment and retention based on such differences as race, ethnicity,
physical ability, sexual orientation, and/or gender.
Printed board policies related to discrimination and anti-oppression.
Practices to Enhance Inclusion
Including diversity considerations during board self-assessments.

Incorporating issues of diversity in the boards work plans and strategic plans.
Attempting to reflect the demographic characteristics of clients, community, or members in the
composition of the board.
Making the business case for diversity, and communicating it to build support for diversity.
Recruitment Practices to Attract Diversity
Advertising for board members in ethno-specific publications.

Partnering with ethnocultural organizations to make them aware of available positions and to help identify
qualified candidates.
Building links to services that search for or match organizations with qualified board members.
Board Structure
Creating a diversity committee tasked with making the board more inclusive.
Using board committees as a training context for members of diverse communities so they are well
prepared to join the board.
to a greater extent representing the interests of the
One particularly salient reason for attempting
communities being served by the organization. The
to include marginalized community members in
functional approach to inclusion was frequently
the board structure is based on the expectations
characterized by a conscious investigation of the
of powerful funding bodies;as one respondent
demographics of the agencys stakeholders, such
succinctly stated, The boards will wake up if the
as clients, members, or communities served. This
funders ask for it.
would be followed by a mapping of that pattern
Although these strategies differ, they share an
of diversity onto the board to see if the external
approach to including diversity within the existing
diversity was represented there. One nonprofit
framework of the board via functional approaches
hospital described it this way:
such as changing formal structures, processes,
Social inclusion is
characterized by the
participation of members
of diverse groups in the
and policies. (See figure 2 for other strategies we
interpersonal dynamics
heard boards using to increase diversity.)
and cultural fabric of
members were female. But we wanted to be
Social Inclusion
the board based on
more reflective of the community, so we did
Social inclusion is characterized by the participa-
a survey of the patients in the hospital. To be
tion of members of diverse groups in the interper-
meaningful relational
proportionate to the patient population, we
sonal dynamics and cultural fabric of the board
realized that the board should add at least one
based on meaningful relational connections. State-
culturally Italian and one culturally Cantonese
ments such as, For me, diversity ... its definitely
Chinese board member.
a sense of inclusivity of everyone and everything.
We looked around the board and saw that we

had women covered because half the board
connections.
I think that [it incorporates] inclusivity, respect.

Respondents provided examples of strate-
I think respect for different peoples beliefs and
gies for purposeful inclusion ranging from the
values is critical, demonstrate an awareness of
general (Gender diversity was very consciously
inclusion as existing beyond task or functional
planned to make sure to maintain a balance) to
views. Respondents who spoke of overcoming
the scientific (We had overall a good ratio of dif-
feelings of alienation made comments like, I was
ferent ethnic backgrounds), and, finally, the tac-
feeling very uncomfortable, but after some time,
tical (We tried to think of women that we were
of course, I had to assert myself, and I had the
working with in the community who were from
support of [a member of high social standing], so
more marginalized communities or tradition-
it was okay. Similarly, another person we inter-
ally marginalized communities, and decided to
viewed spoke of the process of gaining inclusion,
target them. Were doing purposeful recruitment,
claiming, I think I persevered, and really enjoy
and I think that has really made a difference).
the experience now, and the group is just very
receptive to everyones ideas, and we all encour-
relational bonds that contribute to the perfor-
age one another.
mance of the board: We did talk about the need
Although the process of becoming included
for coaching people and partnering people, and
Although the process
in social aspects of the board may not be auto-
giving people a friend on the board to provide
matic, it is an essential facet of genuine member
extra support and translation. Its like cultural
of becoming included
integration. Individuals from traditionally mar-
translation for any new member, but particularly
ginalized communities we talked to spoke about
for new members who either dont have a lot of
how they used humor to help overcome tension,
experience or dont know theres a dominant
how they worked to build relationships, and how
culture at the board that is different from where
they were conscious of the need to build trust
they might be coming from. The energy spent
within the board.
building relationships to foster a shared under-
in social aspects of
the board may not
be automatic, it is
an essential facet
of genuine member
integration.
Our informants also reflected on board-driven
standing was considered by many to be important
efforts to improve social inclusion that included
in attracting and maintaining an active member-
mentorship and coaching, orientation practices,
ship within a more diverse board. A strong and
and other group-building processes such as
welcoming organizational culture was depicted
retreats and workshops. These initiatives illus-
as another way of increasing feelings of inclusion,
trated the belief that strong social relationships
which reduced detachment and turnover.
and higher levels of trust and respect are crucial
Our results suggest that if you want to have
to improving decision making and information
diverse governing groups, you need to find a way
sharing. For example, one board used mentors,
to genuinely speak to people from marginalized
and we heard the following statement: We actually
communities, support these members through the
assign a board member to mentor new members,
transitional phases of board entry, and authen-
particularly young people. And that involves
tically engage them in social aspects that build
making a personal connection with them, phoning
strong relationships and board cohesion. One of
them to remind them about meetings, following up
the core findings of our investigation suggests
with them after meetings to see how they felt about
that underlying social inclusion is the authentic
how the meeting went.
understanding that social relationships have value
Other strategies for building social inclusion

included holding meetings at times and in loca-
in and of themselves beyond any value they may

have as a way to accomplish functional ends.
tions where everyone could attend (in locations

with physical disabilities, or on days that accom-
Putting Social and Functional Inclusion

Together: Transformational Inclusion
modated religious holidays, for example), as well
As described above, during our interviews we
as providing such services as signing for the
heard people talking about social inclusion and
deaf or hard of hearing. Similarly, some boards
functional inclusion, but there seemed to be
made sure that any food that was served accom-
another, even more important message embed-
modated the dietary restrictions and cultural
ded in the conversations: When it comes to
preferences of different members. There was
issues of diversity, all too often the relationship
sensitivity, too, regarding the use of humor and
between traditionally marginalized individuals
choices of subject matter (such as conversations
and the boardroom can be compared metaphori-
about sports teams or summer cottages) that
cally to an egg used in the baking of a cake, as
could marginalize or silence people, or exhibit
seen through the eyes of a child. We like this
unconscious privilege.
metaphor and ask you to visualize a child helping
with elevators in order to be accessible to those
Thus, social inclusion at the board level cen-
his or her father make a cake, first by mixing the
tered on building connections and awareness with
dry ingredients together, and then removing an
the intention to create a positive and inclusive
egg from the carton and placing it whole into the
board culture. Informants acknowledged the
bowl and starting to stir. The father laughingly
importance of using formal initiatives to create
points out that the egg must be broken and the
mixture transformed before the cake is ready
enough to create a cake. Both are necessary,
for the oven.
but neither one is sufficient on its own. A similar
Traditional views of diversity stress the bene-
assertion has been argued throughout the course
fits attributable to representationlike the unbro-
of this article, based on our belief that neither
ken egg placed carefully into the bowl. Missing
functional nor social approaches to inclusion are
from those perspectives is a discourse recogniz-
independently sufficient for a board of directors
ing the transformative implications of mixing the
to be truly inclusive in its orientation. Boards need
egg into the otherwise dry batter, where both are
to consider diversity as inclusivity that influences
irrevocably changed and it becomes impossible
the board in its entiretynot only with respect
to separate out the various ingredients into their
to transforming composition but also in terms of
original forms. Also missing is the recognition
transforming culture and structural parameters.
that just as the cake batter is impacted by the heat
Inclusivity is a culture-changing process, and
in the oven, so are the changing expectations of
one that will bring a multitude of divergent logics
funders, members, clients, and the public at large,
and ideologies to bear on shared and sometimes
in a distinctly
who are turning up the heat on nonprofit boards
divergent interests. Rather than construing this
and demanding that they be more representa-
effort as simply providing a new seat at the table,
changed entity.
tive of their communities. This article develops
genuine transformational inclusivity will result
a theory of transformational inclusivity as a rec-
in a distinctly changed entityone that balances
onciliation of the dilemmas faced by individuals
permeable and responsive boundaries with
and organizations struggling with the challenges
achievement-oriented focus intended to meet the
of workgroup diversity, which if not embraced
demands of the board and its mission.
Rather than construing

this effort as simply
providing a new seat
at the table, genuine
transformational
inclusivity will result
from an inclusion perspective can actually lower

the effectiveness of a board.
Returning to our cake baking metaphor, it is

clear that neither eggs nor cake-mix alone are
issues
weve got

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Unstill Waters:
The Fluid Role of Networks in Social Movements

by Robin Katcher
Social-movement
networks are
Editors note: This article was first published in NPQs summer 2010 edition.
living organisms,
not static entities that
follow flat dictates.
Based on interviews
n individual social movement can span
grassroots effort to create change, this state-
many generations. During that time, it
ment may seem obvious. But it is hardly simple
is likely to face many different, com-
to describe or understandeven when you are
plicated political contexts. As time
right in the middle of it.
passes, a social movement develops its analysis
What movement-oriented networks do best,
of a problem and changes the language and defini-
and what it takes to build and invest in them
tions of things. Often, it meets success and then
over time, often seems difficult to pin down.
encounters the next round of problems caused
At Management Assistance Group (MAG), my
outlines some of
by the preliminary solution gained. Its members
colleagues and I have worked with organiza-
the ground rules
will have passionate disagreements about strat-
tions that are part of movement networks,
egy and approach such that they part ways and
those that act as network hubs, and those that
that create
new members with new views emerge. In other
come together to create new networks. Some
social-movement
words, movements are living beings, affected by
movement networks flourish and others falter.
all manner of influences and sometimes embody-
I set out to deepen our understanding of these
ing great diversity. It is a marvel, then, that any
movement networks by reviewing the scholarly
social movement network stays knit together long
research and interviewing creative, committed
enough to accomplish big societal change. How
leaders who have built networks, even in the
do these movement networks do it?
most unfriendly environments.
with those in the

trenches, this article
success.
Networks are not social movements; but
The organic and responsive nature of networks
social-justice movements need networks, says
makes them difficult to study. Networks play
Marco Davis, a veteran network builder in the
essential roles within movements, but how they
Latino community. For anyone involved in a
do so and even which roles they play are not static.

This fluidity causes movement networks some-
R obin K atcher is director of the Management Assis-
times to appear disorganized and unwieldy, which
tance Group.
has led some to devalue their contribution and
P H OTO G R A P H : M Y P R E C I O U S
others to push for formal structure and control.
network adds up to more than the sum of its
But a deeper look suggests that openness and
parts. Its aggregate power results in gains that
flexibility are necessary components. Without the
will make a difference to their constituencies
ability to learn, adapt, and change, these networks
as well as advance the movement as a whole. A
wither and become uninviting and ultimately irrel-
network allows peoples knowledge, creativ-
evant to new leaders. They lose their ability to
ity, [and] strength to flourish, says Stephanie
authentically respond to political and member-
Poggi, a network builder in reproductive health
ship complexities and ever-changing needs of
and justice. It then pulls together local knowl-
movements in the context of the unstill waters
edge and diverse experiences to create a larger
of society.
understanding of the problems that constituen-
among members. But
cies face. To do so, members are asked to see
members must also see
Like most networks,

movement networks
must foster relationships
The Essential Roles of Movement Networks
themselves as part of an us and examine how
While there are many different types of networks,
that us is positioned within and contributes to
their work for justice as
for the purposes of this article we define move-
the broader movement.
fundamentally linked to
ment networks as the following:
Deepen agreement on a shared political frame.
1. multi-organizational: movement networks link
Together members must understand, integrate, and
independent organizations and activists to one
contribute to a shared vision;align on shared values
another and through a central hub organization;
and principles;and deepen a sense of trust, belong-
2. movement oriented: movement networks
ing, and identity. According to Rachel Tompkins, a
intentionally contribute to a broader social
longtime leader in rural education and childrens
movement;
issues, networks need to create a value system
3. focused on the long term: movement networks
not just information and policy ... building and
stick together for the long haul and join to
deepening values. More than any other factor,
advance interests that extend beyond a single-
this shared political frame connects individuals
issue campaign;and
and organizations to networks, and networks to
4. porous: movement networks have more flexible
movements. Networked nonprofits cannot take
boundaries than a formal franchise structure,
values alignment among partners for granted,
such as the Girl Scouts or Habitat for Humanity.
write Jane Wei-Skillern and Sonia Marciano.1 Net-
Their purpose is not to serve members alone but
worked nonprofits are often far more productive
to meaningfully analyze, understand, and foster
because they dont have to rely on formal control
the development of a movement by working with
mechanisms. Instead, their partners internal moti-
and for others in the network. My research sug-
vation and commitment drive them to work hard
gests that these movement networks play the fol-
for the shared vision of the network.
lowing concrete and essential roles to support and

contribute to their social movements.
of the larger movement.
Those we interviewed note that building such

alignment is not a onetime activity at the start of
Building linkages and connection with a broader
a network (though at the outset, more work may
movement. Like most networks, movement net-
be required), nor is it simple. Political frames must
works must foster relationships among members.
grow and adjust over time.
But members must also see their work for justice
The societal problems that movements seek
as fundamentally linked to that of others and as
to address are large and complex, and so is the
part of the larger movement. Networks help
analysis required to build and adjust the frame.
develop a movement consciousness: thinking
What looks like a solution to some can uninten-
of self as a part of something bigger than you,
tionally affect others.2 Unless its used to spark
emphasizes Dan Petegorsky, a longtime network
the network to deepen and adjust its analysis, this
builder in the progressive movement.
unintended impact can erode a networks cohe-
Members must agree that by joining together
that of others and as part
sion and effectiveness.
within the network, not only do they gain ben-
This requires movement networks to not only
efits for their own work but also the work of the
bring diverse constituencies together but also
center analysis on the lived experiences of those
Engage in advocacy campaigns. Some networks
most affected by the problem the movement seeks
develop a shared policy framework that members
to solve. Networks provide the venue for the
advance locally, while others run specific, joint
understanding of how constituencies of different
national legislative campaigns, and others do
races, ethnicities, classes, genders, sexualities,
both. Effective policy campaigns help cut the
immigrant status, ability, and other historically
issue, give members clear handles to focus,
oppressed groups are differently impacted by
and specify the complex problems movements
the same problem, observes Darlene Nipper, an
seek to address. They also must seek to win real
messages, approaches,
LGBT leader.
improvements in the lives of constituencies.
programs, innovation,
Networks help build this analysis, says Peter
Several interviewees discussed why they
Hardie, an economic-justice network leader,
believe its critical to advance policy through a
and ideas to network
by pushing political questions and deepen-
network. If we try to shift policy in isolation, we
ing peoples understanding of other parts of the
often make mistakes, says Moira Bowman, an
members and,
movement ideology, politics, campaigns, orga-
experienced organizer in reproductive justice and
nizations. Networks also intend to understand
progressive movement building.
Networks become
vehicles for
dissemination of
sometimes, to the
public at large.
the opposition, its frame, and its strategies. As
Interviewees say that better policy emerges
Petegorsky explains, networks need to deal with
through the input of diverse perspectives and that
wedge issues openly and honestly. Then they cant
networks have an important role in developing
divide you. Look at how potential allies are pitted
policies and mobilizing members to win change.
against one another. Watch it closely, because this
Effective campaigns require a combination of
will change over time.
seizing political opportunities when they arise
Coordinate efforts, take joint action, and dis-
and engaging in the slow, steady work of building
seminate information about what works. Networks
political power that must be exploited when the
facilitate and support coordinated action among
moment is ripe. Networks help create the level of
organizational members. Social movements need
organization necessary, according to Petegorsky,
coordinated action to build momentum, dem-
by develop[ing] the leaders, materials, connec-
onstrate support, and push for change. Some
tions that prepare people to run campaigns. This
networks engage in coordinated action by proac-
allows networks and their members to quickly
tively designing and leading joint national efforts
take advantage of political opportunities.
with their members;others coordinate, support,
Network membership alone is often insuffi-
and amplify the existing work of members to
cient to win a specific campaign. Interviewees
deepen impact.
have found that successful campaigns require
Networks become vehicles for dissemination
creating coalitions with those outside the tra-
of messages, approaches, programs, innovation,
ditional boundaries of the network, including
and ideas to network members and, sometimes,
unlikely allies that may agree with the network
to the public at large.3 Effective dissemination
on only one issue and that have significant
requires strong, trusting relationships among
political influence. In this way, campaigns are an
innovators and possible implementers. As Marco
important avenue for expanding and activating
Davis explains, members need to understand
network members;reaching out to those at the
new models [for doing the work], and [to spread
periphery of the movement;and building power,
them] you need credibility and trust so members
influence, and visibility.
can acknowledge the value and be willing to try
Unlike other policy-change efforts discon-
it themselves. You need trusting relationships
nected from movements, winning a specific
in order to spread innovation and successful
policy change is not the end goal for networks,
approaches. [The network is] not just a space for
but rather a means to the ultimate end that gets
sharing convictions; you also need mechanisms
one step closer to the movements long-term
and how-tos so the parts of the network can delib-
vision. Tompkins says that its important to win
erately build the movement.
policy campaigns, but campaigns are also about
spreading values to others in members communi-
them, Nipper says. We should push the bound-
ties. Winning a campaign is great, but hopefully
aries of the network to include constituencies
[its] building more long-term support for the
traditionally marginalized.
cause. We must ... tie policy to values so that over
Identify and fill gaps in the movements capacity
time people connect to a set of values beyond a
to win. Networks ought to build an honest and
specific policy.
shared analysis about where the network is strong
Leadership development
efforts must ensure that
Marshall and increase resources and capacity.
and where it lacks the capacity to be an effec-
The strength and power of networks are derived
tive player in the movement. As Bowman says,
critical constituencies
in large part from aggregating the strength and
Networks are catalysts for building capacity
power of members. Our power comes from our
for movements and not just individual organiza-
previously excluded
members, observes Diann Rust-Tierney, a leader
tions. Networks must thus focus on the spaces
from leadership roles
in the criminal-justice-reform movement. We are
between [organizations] and identify whats
only as strong as they are. Networks therefore
the necessary leverage point to get to the next
have a place at the
must focus on building the organizational capacity,
stage of movement building. This doesnt mean
effectiveness, and sustainability of members indi-
that network hubs should fill all these gaps, but it
vidually and collectively. The role of a network is
suggests that networks have an important role in
to hel[p] organizations to do their local work and
helping members identify need and how it might
connec[t] those leaders to a broader movement
be met.
and sustai[n] their organizations over time, Poggi
While networks often aspire to play all these
says. We walk with them through their evolution.
roles, they often fail to live up to their promise.
For nearly all the network leaders interviewed
The competition for resources, the pressures of
for this research, this means helping deliver
building individual organizations, and the divide
capacity-building services (i.e., technical assis-
between national and local organizations often
tance, leadership development, training, coach-
act as sizable barriers. So while networks can
ing, and on-site organizational development)
play each of these roles, rarely does one play all
and actively working to raise money and visibil-
simultaneously.
ity for the network and its parts. Some organize
The work of the movement network is shaped
philanthropy and make a case for why expand-
and driven by the movements they seek to support
ing giving to network members can increase a
rather than only the network itself or its members.
network table.
foundations impact. According to Tompkins,

credible and legitimate and sustainable, espe-
Beware: Calcified Structures Can Clog

Network Arteries
cially since networks can sometimes get access
Networks are complex and require balancing
to national foundation money that locals could
many varied and seemingly contradictory ele-
never reach on their own.
ments. They juggle the autonomy of individual
a network should help make the parts more
Cultivate new leaders and build their identity as
members with the need for collective action and
part of the movement. Most movement leaders gain
accountability;hold the needs and engagement of
experience by first engaging with local organiza-
existing and emerging members;straddle political
tions in their own community. But their capacity
disagreements and differing approaches to the
to develop concrete leadership skills, think strate-
work;and balance transparency and engagement
gically, build relationships, and broaden their own
in decision-making processes with the need for
movement analysis is often enhanced by involve-
efficiency and rapid responses. To get the work
ment in movement networks.
done and create predictability and organization,
Leadership development efforts must ensure
people in networks (and those that attempt to
that critical constituencies previously excluded
support them) tend to build structures, rules, and
from leadership roles have a place at the network
procedures.
table. Networks need to keep bringing in those

most affected by the issue and make room for
The problem isnt that we build structures;

its that we get attached to them and believe that
Structures get rigid,

hardened, calcified.
Rather than being
vehicles to open space
or advance critical work,
they start to block the
vitality of the network.
they will provide the glue to hold these networks
Make space for marginalized and new voices.
together. Structures get rigid, hardened, calci-
Networks that fail to give space to marginal-
fied. Rather than being vehicles to open space or
ized voices and bring in new leaders wither. In
advance critical work, they start to block the vital-
progressive social-justice movements, we must
ity of the network. Shifts are happening minute
understand how societal oppression plays out
by minute and subtly, Nipper says. A lot depends
within our networks. If we do not, our vision for
on where the network comes in during the move-
a just future, our principles, and our values no
ments development. She pauses, then adds, We
longer ring true, and the very glue of the move-
need to ask ourselves, Do structures help or hurt
ment network disintegrates.

Learn from those outside their movement.
what the network is called to do?
When two networks from different movements
Fostering Flexibility
come together to learn, space for creativity and
My work suggests that networks that emphasize
increased strength opens up. Interviewees for this
structure are less effective than those that adeptly
article were eager to learn how other networks
learn and change. To support adaptation, inter-
operating within submovements developed,
viewees sought to engage members in some of
learned, innovated, and adapted. But in the press
the following:
of their daily work, they rarely found the time to
Analyze the movement. The network must consider questions such as, What does the movement
learn from others.
call on us to provide? It examines the current
Experiment. Networks cannot seek agreement
political context, the trajectory of the movements
from everyone on everything;they would never
own development, the opposition, and the move-
get work done. Trying to get consensus not only
ments successes and failures. It considers other
slows the process but also drains an idea of cre-
actors within the movement, and looks at what is
ative juice. Networks can create an environment
currently provided and what is missing.
that welcomes small-scale experiments. Ideas
Accept the networks real and potential power. For
come forth, and those within the network with
networks that seek to empower their organiza-
the energy to pursue these ideas design a small
tions, leaders, and constituents to take action, it
experiment. If the experiment works, it will
can be difficult to accept the political power of a
attract others over time. If it fails, scarce time and
network. But networks must assess where they
resources havent been wasted. As Bill Traynor
do not have the power to effect change. Networks
writes, effective networks resource the specific
often skip this conversation to their own detriment.
demand and starve bad ideas and activities that
Its almost impossible to design winning campaign
dont have genuine value.5
strategies and build necessary capacity when networks arent honest about the starting line.
document their own approach and reach out to
Identify innovation. Networks should seek

innovation and remember that it most frequently
Minimize permanent structure. Effective net-
emerges from those working on the ground and
works create temporary subunits comprising
closest to the issue and constituency. Poggi sug-
members within the network that work together
gests that network leaders have to pay more
to advance goals and engage in certain activi-
attention to visionaries and innovators on the
ties. Depending on the goal, members may need
ground and be a step ahead but without getting
to cede greater or lesser control to a key leader
too far forward. Doug McAdam echoes this sen-
within the network or staff member at the central
timent and says that peaks in movement activ-
hub. In this way, aspects of networks work can be
ity tend to correspond to the introduction and
open and decentralized and others highly central-
spread of new protest techniques or tactical
ized. Many effective networks avoid making even
innovation.6
the best-run units permanent;they allow them to
Encourage disagreement and disruption. Net-
exist for the length of the task and no longer to
works can become places for experimentation
create room for the next task.
and disruption that help movements innovate and
stay ahead of the opposition. Good movements
thinking on what it takes to build and develop
force [network] leadership to reevaluate, to see
nonprofit organizations.11 If we want to support
new perspectives and fresh ideas, to challenge old
the development of social movements, we must
ways, says an interviewee. [You] have to fight;
understand not only individual organizations but
this is the messy part of it. The very innovation
also what it takes for them to come together in
that starts well and gets established can get in the
strong, fluid, adaptive, and effective networks.
way. Upheaval is good.
This requires us to embrace the often messy
Change does not always

fit neatly into a structure
Change does not always fit neatly into a struc-
process of creating and growing networks and to
or a process, but seeing
ture or a process, but seeing the need for it and
engage in more thinking and discussion to better
the ability to harness the creative opportunities
understand what supports movement networks
the need for it and the
that come with change are essential. The art of
learning and adaptation so that they can answer
ability to harness the
leadership in todays world involves orchestrat-
the call at each critical moment.
creative opportunities
ing the inevitable conflict, chaos, and confusion

of change so that the disturbance is productive
N otes
rather than destructive, write Ronald Heifetz,
1. Jane Wei-Skillern and Sonia Marciano, The Net-
Alexander Grashow, and Marty Linsky.7
worked Nonprofit, Stanford Social Innovation
Create time and space for reflection. Network
2. Rupert F. Chisholm, Developing Interorganizational
on past efforts and integrate them into the culture
Networks, in Handbook of Organization Develop-
of the network.8 Its critical to include the insight
ment (Thousand Oaks, CA: SAGE Publications, 2008).
and experiences of those directly affected by the
3. Doug McAdam, Tactical Innovation and the Pace
problem that a network seeks to address.
of Insurgency, American Sociological Review 48,

no. 6 (December 1983).
strategic risk taking and appreciate mistakes as
4. Ibid.
opportunities to learn. They benefit from asking,
5. Bill Traynor, Vertigo and the Intentional Inhabit-
Could we have greater impact if we did some-
ant: Leadership in a Connected World, The Nonprofit
thing differently? Networks ought to be less
Quarterly 16, no. 2 (summer 2009): 8386.
concerned with making correct decisions than
6. McAdam, Tactical Innovation and the Pace of
with making correctable ones;less obsessed with
Insurgency.
avoiding error than with detecting and correcting
7. Ronald Heifetz, Alexander Grashow, and Marty
for error, writes Robert Reich, a professor at the
Linsky, Leadership in a (Permanent) Crisis, Harvard
University of California, Berkeley.9
Business Review (July-August 2009).
Connect and align action with vision. While net-
8. Chisholm, Developing Interorganizational
works seem to learn and adapt best in flexible
Networks.
environments, they also need to consciously build
9. Robert Reich, The Next American Frontier, the
unity, loyalty, and connection to keep members of
Atlantic Monthly 251, no. 3 (March 1983): 4358.
the network together. The ongoing development
10. Wei-Skillern and Marciano, The Networked
and recommitment to shared vision, values, and
Nonprofit.
long-term goals is essential. When networked
11. Beth Zemsky and David Mann, Building Organi-
nonprofits share the same values, they do not have
zations in a Movement Moment, Social Policy 28,
to try to manage for every contingency and are
no. 3 (Spring-Summer 2008): 917; David L. Brown,
less apt to exert control to ensure quality, write
Mark Leach, and Jane Covey, Organization Develop-
Wei-Skillern and Marciano.
ment for Social Change in Handbook of Organization
10
are essential.
Review 6, no. 2 (spring 2008).
leaders need to build in opportunities to reflect
Networks benefit from cultures that honor
that come with change
Development.
Accepting the Organic Nature of Networks

The highly adaptive nature of networks that seek
to contribute to and support social movements
challenges the past thirty years of traditional
governance
Community-Engagement Governance:
Systems-Wide Governance in Action
by Judy Freiwirth, PsyD
Many nonprofits look
at the board as the
only locus of governancea view
that increased
expectations
about stakeholder
engagement in
decision making
has rendered
obsolete. This article
proposes a more
complete vision of
the function that
engages many bodies
in and around the
organization in the
direction and implementation of its
work.
t has become increasingly clear that tradi-
on corporate models and outdated, top-down
tional governance models are inadequate to
command and control paradigms, still domi-
effectively respond to the challenges faced
nate the nonprofit sector. Within these models
by many nonprofits and their communities.
are strong, inherent demarcations between board,
Yet most nonprofits and capacity builders con-
constituents, stakeholders, and staff, with the
tinue to rely on these models, hoping that more
executive director often the only link between
training or improved performance will transform
the various parts of the organization. This type of
the way their organizations are governed, only
separation commonly results in the disconnec-
to find that the underlying problems remain.
tion of the board and, ultimately, the organiza-
In response to the need for new approaches to
tion from the very communities they serve, and it
governance, a national network of practioners
inhibits effective governance and accountability.
and researchers known as the Engagement Gov-
Moreover, the pervasive trend toward profes-
ernance Project, sponsored by the Alliance for
sionalism, with boards comprised of experts
Nonprofit Management, has developed a new gov-
who may or may not be engaged with the orga-
ernance framework.1 Since NPQs last two articles
nizations mission, has tended to deepen a class
on the subject, in 2006 and 2007, the Engagement
divide between boards and their communities.
Governance Project has continued to develop the
Ultimately, these models prevent nonprofits from
framework and has launched a national participa-
being effectivethat is, responsive and account-
tory action research project with pilot organiza-
able to the communities they serve.
tions from around the country. The research has

2
produced some exciting results.
Beth Kanter and Allison Fine, in their new

book The Networked Nonprofit, describe the normative state of many nonprofits as fortressed
Why New Governance Approaches Are Needed
organizations that sit behind high walls and
Traditional governance approaches, based
drawn shades, holding the outside world at bay

to keep secrets in and invaders out.3 Unfortu-
J udy F reiwirth , P sy D, is Principal of Nonprofit Solu-
nately, this description applies to many nonprofit
tions Associates and Chair of Alliance for Nonprofit
boards that follow traditional, insular gover-
Managements Governance Affinity Group/Engagement
nance models. Boards that adopt these models
Governance Project, a national network of capacity build-
often become so inwardly focused that they
ers and researchers focused on developing new gover-
isolate themselves from the communities they
nance models and practices.
ostensibly serve.
P H OTO G R A P H : S Y N E S T H E T E
Perhaps most important, the nonprofit sector
framework was designed as an approach, rather
should foster and advance democracy and self-
than a model;this means it can be adapted to each
determination. If a nonprofit organization is
organizations unique needs and circumstances.
If a nonprofit
to be truly accountable to its community and
In other words, while the framework is based on
constituencies, democracy must be at its core.
a common set of underlying principles, the spe-
organization is to be
Yet, the nonprofit sector has typically tended
cific structures and processes it engenders differ
to replicate structures and processes that actu-
across organizations.
truly accountable
ally hinder democracy within organizations.

Hierarchical structures in governance not only
Key Principles of the Framework
run counter to democratic values and ideals,
Community impact at the core. In contrast
they often impede an organizations efforts to
to traditional governance models, in which the
democracy must be
achieve its goals and fulfill its mission. If those
primary focus is the effectiveness of the orga-
at its core. Yet, the
who are directly affected by an organizations
nization, the framework situates the desired
actionsits constituencyare not included in
community impact at its core. This repriori-
nonprofit sector has
key decision-making processes, they may not
tizes results over institution, and also makes
be as likely to back the organization with their
the desired impact overwhelmingly the most
typically tended to
advocacy voices, volunteer time, or cash. Addi-
to its community
and constituencies,
replicate structures and

processes that actually
hinder democracy within
organizations.
Governance as a function, rather than a
risks arriving at conclusions or decisions that
structure;no longer located solely within
are incongruent both to its constituents needs
the confines of the boards structure.
and its own mission.
The Engagement Governance Project defines governance as the provision of guidance and direc-
Beyond the Board as the Sole Locus of

Governance
tion to a nonprofit organization, so that it fulfills
Community-Engagement Governance is an
taining accountability and fulfilling its responsi-
expanded approach to governance, built on
bilities to the community, its constituents, and
participatory principles, that moves beyond the
the government with which it functions. Legally,
board of directors as the sole locus of gover-
there are few requirements regarding who can
nance. It is a framework in which responsibility
partner with the board in shared decision making.
for governance is shared across the organization,
Thus, nonprofits have leeway regarding which
including the organizations key stakeholders: its
decisions it can choose to share withor delegate
constituents and community, staff, and the board.
toconstituents and other stakeholders (or share
Community-Engagement Governance is based
with other nonprofits), and which decisions fall
on established principles of participatory democ-
under the boards purview.
racy, self-determination, genuine partnership,

and community-level decision making.
important focus of nonprofit governance.
tionally, a nonprofit without such involvement
its vision and reflects its core values while main-
Governance decision making and power

is shared and redistributed among key
The Community-Engagement Governance
stakeholders, resulting in higher-quality
framework helps organizations and networks to
and better-informed governance deci-
become more responsive to their constituents
sion making and mutual accountability.
and communities needs and more adaptive
The heart of governance is decision making
to the changing environment. It also provides
meaning power, control, authority, and influence.
more person power and credibility with funders.
With the framework, decision makingand
Because no one governance model can fit all orga-
thus poweris redistributed and shared, creat-
nizations, and because many factorsincluding
ing joint ownership, empowerment, and mutual
mission, constituency, stage of organizational
accountability. Those who have the biggest
development, and adaptabilityinfluence what
stake in the mission and are closest to the orga-
design will be most effective, the framework
nizations workconstituents, other stakehold-
can be customized by each organization.4 The
ers, and staffare partners with the board in
governance decision making. This redistribution
governance to be shared among three organiza-
of power makes nonprofits both more resilient
tional layers nonprofits serve:(1) the primary
and more responsive to their communities.
stakeholders (i.e., constituents and those that
Democracy and self-determination, rather
directly benefit from the organizations mission);
than dependency and disempowerment.
(2) the organizational board, staff, and volun-
The nonprofit sector should above all foster
teers;and (3) the secondary stakeholders (i.e.
and advance democracy and self-determination,
funders, community leaders, legislators, collabo-
and this drive should reach deeper than simply
rating nonprofits and partners, and networks).
advocating for such democratic values outside
The organization determines, along a continuum,
the organization. Yet most nonprofit governance
what types of governance decisions are situated
models, even those that are constituent-based
in what layer of an organization, who should be
affecting the levels of
or representational, tend to replicate outdated
involved in the decision as mutual participants,
hierarchical structures and processes. Such hier-
and how the decisions are made. Four of the
transparency within
archical structures not only run counter to demo-
key governance functions (planning, evalua-
organizations. Ongoing
cratic values and ideals, they also often impede an
tion, advocacy, and fiduciary care) involve dif-
organizations ability to achieve its own mission.
ferent layers of the organizational system. Policy
communication and
No one right model: an underlying contin-
changes, for example, might first be discussed
gency approach. Although the framework uses
within groups representing the interests of one
common principles, the specific governance
layer, and then by the organization as a whole;
structures and processes employed by a nonprofit
or, in very large organizations, within a cross-
will differ according to the organizations needs,
sectional group made up of representatives from
size, mission, and stage of development, among
each sector. Team structures that possess deci-
engaging stakeholders in
other variables. This results in great variability in
sion-making authority are often used as vehicles
governance designs across organizations.
to engage stakeholders as well as whole system
shared governance.
Governance functions distributed cre-
methodologies for major decisions, where all
atively among stakeholders. Rather than
layers of stakeholders are brought together for
focusing on the commonly used list of gover-
shared decision making. And key strategic direc-
nance roles and responsibilities, it is more useful
tions are usually decided on by all layers, includ-
to focus first on governance functions, such as
ing active constituents, other key stakeholders,
planning, evaluation, advocacy, and fiduciary
and the board and staff.
concerns, and then look creatively at how these

can be distributed among stakeholders.
media and e-governance

throughout the nonprofit
sector is already
continual information
flow among stakeholder
groups are critical for
We believe certain competencies are necessary for an effective shared-governance
Transparency, open systems, and good
system. As shown outside the concentric
informational flow between stakeholder
circles in the diagram, there are five critical
groups. The spread of social media and e-gov-
governance competencies: strategic think-
ernance throughout the nonprofit sector is
ing;mutual accountability;shared facilitated
already affecting the levels of transparency
leadership;cultural competency;and organi-
within organizations. Ongoing communication
zational learning. These competencies should
and continual information flow among stake-
be intertwined with all areas of governance
holder groups are critical for engaging stake-
work and organizational components. In this
holders in shared governance. Social media and
way, they will contribute to the organizations
e-governance have proven to be extraordinarily
flexibility, adaptability, and responsiveness to
useful tools for creating increased transparency
environmental changes.
and facilitating large-group decision making.
The spread of social
The design/c oordinating function of the

process is performed by a design or coordinat-
How It Works
ing team, or, in some cases, by the board itself.
As depicted in figure 1 (following page), the
In many instances, the board continues to hold
framework allows for different kinds of shared
the fiduciary care roleensuring financial
Figure 1: Community-Engagement Governance Framework
Nine diverse organizations are currently pilot-
gic Thinking
Strate
ary Stakeholder
econd
s
ing the Community-Engagement Governance

Framework and adapting it to their constituen-
Organizati
ona
l Le
arn
in
g
bility
unta
cco
lA
ua
ut
M
S lators, Other Nonpro

fits, N
gis
etwo
rs, Le
e
d
rks
Fun
ional Staff, Board, Volun
t
a
z
i
teer
an
s
Org
y Stakeh
marunity/Constitou lders
i
r
enc
P omm
y
C
Desired
Community
Impact
PLANNING
Community-Engagement Governance in
Action: Action Research Findings
FIDUCIARY CARE
cies, missions, stages of development, strategic directions, and external factors. These nine
organizations have a wide range of missions,
annual budgets, developmental stages, constituencies and types of communities served, adaptive
capacities, and staff sizes. They include national,
statewide, and community-based organizations,
coalitions, and networks. Their missions include
pe
hip
e rs
ad
ed
lC
Le
ra
AD
VO
C
IO
lt u
T
UA
AL
EV
Cu
AC
Y
immigrant rights and services, homelessness
te
nc
e
har
il
ac
dF
ita
prevention, affordable housing advocacy and

services, national policy education, reducing
disparities in health access, obesity prevention,
youth development, community organizing, and
leadership development.
One pilot is being conducted by a network/
partnership of more than one hundred nonprofit
organizations and state agencies. Using the Com-
LEGEND
munity-Engagement Governance Framework,
Desired community impact = primary purpose of governance
this network has developed a statewide shared
Concentric circles = stakeholder groups engaged in shared governance

The circles represent the different layers of engagement in governance, with the primary stakeholders (the
constituency/community) serving as active participants in meaningful decision making.
governance structure with the purpose of fighting
Dotted lines between circles = open communication flow and transparency
zation that had been dormant for five years. The
Elliptical circles = governance functions

The diagram identifies four governance functions: planning, advocacy, evaluation, and fiduciary care. The
circular arrows represent the engagement continuum. Within each governance function, the extent to which
each stakeholder group (constituents, staff, board, other stakeholders) is engaged in shared decision making
may vary; leadership responsibilities within these functions may also vary among the stakeholder groups,
depending upon the organization.
obesity and chronic disease in the state. Another

pilot is being conducted by a reinvented organiorganization, which focuses on youth development through mentoring with seniors, is now
using the framework to make itself more responsive to the community and more effective in
implementing its mission.
The consulting/research team has been using
The four governance functions are the following:

Planning functions range from whole-system strategic direction setting and coordinated planning to input
on trends and priorities;
Advocacy functions range from joint decisions about policy and distributed advocacy activities to
participation in needs assessment;
Evaluation functions range from shared participation in design and implementation, and lending resources
and expertise, to feedback on quality; and
Fiduciary care activities range from stewardship and resource development to defining resource needs.
action research methodologya systematic
Labels outside of circles = governance competencies

Competencies intertwined with all areas of effective governance
munity-Engagement Governance team. With
cyclical method of planning, taking action,

observing, evaluating, and critical reflecting
prior to continued planningto document
findings for continual learning. 5 Each pilot
organization is either currently working or has
worked with a lead consultant from the Comthe participating organizations, the consulting/
research team is documenting the process by
conducting a series of semi-structured inter-
management and resource development func-
views and surveys with a cross section of
tionswhile in others, parts of this function are
primary and secondary stakeholders. Together,
shared by various stakeholders.
we are learning about the implications of
different variations of the approach;the ben-
strategic directions, executive-director hiring,
efits and challenges for the organizations, net-
campaign planning, advocacy and organizing, and
works, and communities;the success factors; leadership developmentwith their members

and how to improve the framework.
(who come from their broader, Latino, community). The board continues to hold fiduciary and
The consultants have
What Are Structures and Decision-Making

Methodologies for Effective System-Wide
Governance?
legal responsibilities but shares most other key

blies are convened several times a year, and are
organizations with
The consultants have assisted the pilot orga-
the highest decision-making structures for the
nizations with different governance designs
organization. At the assemblies, a large group of
different governance
(structures and processes). Each organization
active members from the community, board, and
designs. Each
determines which decisions will be shared by
staff jointly make the larger strategic-direction
which stakeholder groups, and how such deci-
decisions for the organization. They also delegate
organization determines
sions will be made and coordinated. Some pilot
governance responsibility through a team struc-
organizations have created structures that include
ture. These teams, which assume much of the
cross-representational decision-making teams
governance decision making focused on program
and task forces focused on specific governance
directions and campaign organization, comprise
functions, such as strategic direction setting, plan-
the board, staff, and active members.
decisions with the membership. Member assem-
ning, advocacy, and fiduciary oversight. Most of
Homes for Families (see figure 3, p. 71), a state
the pilots have also used large-group decision-
wide organization that serves the homeless, holds
making methodologies, such as World Caf,
a whole-system yearly visioning session that
Future Search, and Open Space Technology.6 Pilot
involves constituents, board, staff, members,
organizations have used community forums, town
and partner organizations. During the session,
hall structures, and other large-group democratic
the strategic directions and new initiatives for
meeting formats, too. For example, one pilot orga-
the organization are decided on together. Based
nization convenes a members assembly several
on these decisions, the board (half constituents,
times a year to decide on its strategy;this assem-
half other primary stakeholders) and teams
bly includes active members, key community
(also comprised of constituents and primary
leaders, and the board and staff.
and secondary stakeholders) coordinate a range
Another pilot organization convenes large-
of governance decisions. Uniquely, they have
group visioning sessions, which set the stra-
developed an integrated, ongoing constituent
tegic and advocacy direction for the year. These
leadership development program that builds
sessions involve a large group of constituents,
governance skillsespecially advocacy skills,
the board, staff, member organizations, and
which are significant for their mission. Constitu-
other collaborating organizations. Other pilot
ents who graduate from the training assume
organizations have used e-governance and social
leadership positions within an advocacy leader-
media, not only to facilitate shared leadership
ship team, which then designs and implements
through transparent information, but also to
their advocacy/organizing strategy. Constituents
facilitate ongoing strategic-level discussions,
and other stakeholders also comprise the public
and, most important, to make decisions as a large
policy committee, which makes governance deci-
group. In addition, pilot organizations have used
sions regarding public policy strategy between
open system, team decision-making structures.
visioning sessions. Some constituent leaders are
assisted the pilot
which decisions will

be shared by which
stakeholder groups,
and how such decisions
will be made and
coordinated.
also board members, and contribute to other
A Few Examples
governance decisions. In addition, to address
Centro Presente (see figure 2, following page), a
other governance decisions, the organization
prominent immigrant rights organization in Mas-
currently plans to develop new cross-sectional
sachusetts, shares governance functionssuch
teams comprising representatives from each
as decisions regarding strategic planning/setting,
organizational layer.
Shaping New Jersey, a statewide network of
Figure 2: Centro Presente Governance Design
access to healthful foods. They also employ

e-governance, using polling to make decisions
and a web portal to make documents and reports
transparent to the full partnership.
Key Findings/Benefits of Using

the Framework
MEMBERS
ASSEMBLY
Although the action research continues, several
Sets key strategic directions,

program initiatives, policies
(meets 12 times a year)
Board
Fiduciary/Coordination
Workers
Rights
Teams
Civic
Engagement
Campaign
Team
significant preliminary findings illustrate the benefits of the frameworks approach:
Staff
Campaign
Organizing
SOMOS/WE ARE
Team
1. Increased ability to respond to community

needs and changes in environment;increased
accountability to the community.
All the pilot organizations that have implemented
a significant portion of their new governance
model report that, through the process of involving their stakeholders in governance decisions,
Membership
they have been able to respond more quickly to
Latino Community
to community needs, and mobilize more quickly
changes in their environment, be more responsive

in response. For example, Centro Presente felt
that by redistributing power in their organization so that it was shared between the board and
their active membership (community members
Shaping New Jersey (see figure 4, p. 72), a state-
who are directly affected by immigration policy
wide network of more than one hundred non-
changes), they could mobilize much more quickly
profit and government organizations, is using
in response to immigration policy changes. Simi-
this framework for a coordinated planning and
larly, other pilot organizations report that they
having a significant
implementation process to reduce New Jerseys
have been more proactive, adaptable, and nimble
obesity levels. Using the Community-Engagement
in their decision making. With stakeholders
role in decision
Governance Framework principles of shared
having a significant role in decision making, the
governance and power, network members have
pilot organizations believe their accountability to
designed a structure and process in which the
the community has also increased.
With stakeholders
making, the pilot
partner organizations make governance deci-
In the past, Shaping New Jersey had attempted
sions regarding the planning and implementation
to develop a coordinated plan of action, but
of state-level environmental and policy strategies.
they were unable to create enough ownership
the community has also
An executive/sustainability committee represent-
of the plan to lead to its successful implementa-
increased.
ing fifteen to twenty partner organizations serves
tion. Now, through the use of the Community-
as both a design and coordination team. The team
Engagement Governance Framework, they
facilitates meaningful partner engagement in
have created a process and structure of shared
joint advocacy, communication, and collabora-
governance, resulting in a highly collaborative,
tive plan implementation. While full partnership
coordinated (owned) plan. The group rates a
meetings occur twice a year, most of the decision
sense of shared ownership and accountability
making occurs within a variety of work teams
to the larger community as a critical factor in
comprised of partner organizations empowered
achieving successful outcomes. They also report
to make decisions ranging from setting advocacy
that this sense of ownership and a new, high level
priorities to designing strategies for increasing
of participation in decision making from the
organizations believe
their accountability to
more than one hundred partners have resulted
Figure 3: Homes for Families Governance Design
in a coordinated action plan that responds to the

alarming rate of obesity in their state.
Primary Stakeholders:
2. Improved quality and efficiency of governance

decision making: increased strategic thinking,
creativity, and problem-solving ability.
(Constituents: Currently and Formerly

Homeless Families, Member Organizations)
VISIONING DAY
Pilot organizations that have implemented the
Whole System Forum for Setting

Key Strategic Directions
framework state that the quality of their governance decision making has improved as a result
(Constituents: Currently and Formerly Homeless Families,

Member Groups, Partner Organizations, Board,
Staff. Held Once a Year)
Fundraising &
of their shared governance model. They cite

increased creativity along with new thinking and
Finance Team
(C, PS, SS, B)
innovative ideas, all resulting from the involve-
Leadership
Training
for
Constituents
ment of key stakeholders in their decision making.

Others point to the ability to be more strategic
in discussions; with more community involvement, they are better able to solve complex prob-
Secondary
Stakeholders:
lems. For example, one pilot organization cites
(Partner
Organizations,
Policy-makers,
Academics)
its ability to design a compelling and effective

strategy in its lobbying efforts with legislators.
Subsequent discussions and strategic decisions
Leadership
Development
Team
Public Policy
Committee
Strategy decision making

(C, B, PS, S)
Advocacy
Leadership Team
(B, C, S)
Board
Strategy decisions and

decisions/organizing campaigns
(constituent leaders)
Fiduciary/Coordination
(C, B, PS)
made with their primary stakeholderscurrently

Project &
Event Teams
and formerly homeless individualsled to a much

more effective and creative organizing and lobby-
(C, PS, SS, B, S)
ing strategy. This, in turn, led to increased government funding for more innovative and responsive
services. Another pilot organization spoke of its
increased ability to quickly align its program
LEGEND
B = Board C = Constituents PS =Primary Stakeholders S = Staff SS = Secondary Stakeholders
direction with changing community needs.

One frequently asked question about the
framework is whether involving stakeholders in
includes stakeholdersleads to increased invest-
the decision-making processes leads to more cum-
ment and ownership of those decisions. Others
bersome, time-consuming processes. The answer
report that the quality of those decisions has dra-
appears to be no. In fact, the pilot organizations
matically improved. Still others cite an increase in
report that, compared with their previous models,
morale among both the board and staff.
they are now able to make more efficient deci-
Pilot organizations
report that
sions by using a shared governance structure. By
4. An increase in new and more distributed leadership.
including key stakeholders in the decision-making
As part of their efforts to include community
process, the information, knowledge, skills, expe-
members and constituents in shared governance
rience, and connection to the mission are in the
decision making, some pilot organizations report
decision-making
room and more accessible to the decision-making
that they have developed leadership-development
process, thereby allowing organizations to make
initiatives to assist constituents in acquiring lead-
structure leads to
effective decisions more quickly.
ership skills. In the past, these initiatives tended to
increased investment
include leadership-development workshops, but
and ownership of those
3. Increased shared ownership of the organizations

mission and strategic directions.
now constituents are more likely to be engaged
Pilot organizations report that implementing
of work teams, task forces, and other decision-
a shared decision-making structureone that
making structures.
in learning by doing, often sharing leadership
implementing a shared
decisions.
Figure 4: Shaping New Jersey Governance Design
6. Increased visibility within the broader community.

Several groups report that their increased ability
to respond to changes and needs in the community
has led to more ongoing and increased visibility
within their communities. In turn, this increased
visibility has led to greater support from secondary
stakeholders, and, ultimately, has helped to build
FULL PARTNERSHIP
MEETINGS
School
Work Group
EXECUTIVE &
SUSTAINABILITY
COMMITTEE
Healthcare
Work Group
OFFICE OF
NUTRITION &
FITNESS
their membership and network of supporters.

Childcare
Work Group
7. Increased fundraising capacity and sustainability.

Several pilot organizations report that their
increased visibilitythrough the process of
engaging their community in governance deci-
Community
Work Group
sion makinghas strengthened their fundraising. As they shifted to a grass-roots fundraising

strategy that engaged community members,
they eventually built more diverse community
Workplace
Work Group
Partnership of
100 Organizations
ownership of the organization, as well as more

sustained funding.
8. Increased transparency and community ownership

and more effective large-group decision making
through the use of social media and web portals.
LEGEND
Governance decision making at all levels of partnership
Several pilot organizations have used social media

and web portals, including tools for large-group
Work Groups are empowered to make most of the governance decisions. Determine yearly policy and
advocacy priorities and design new programming related to plan priorities.
decision making, on a regular basis. They have
Executive & Sustainability Committee makes governance decisions at full partnership meetings,
including monitoring and crosswork group coordination. Integrates key strategic direction and advocacy
efforts. Comprised of every work group leader and other state leaders.
parency, facilitate inclusive decision making, and
Full Partnership Meetings are comprised of over 100 organizations. Meet several times a year to build
consensus. Decide on the next years plan (designed by work groups and integrated by E & S committee
and staff).
9. Boards that are more engaged, passionate, and

transparent about their organizations strategic
direction and programs.
Office of Nutrition and Fitness is the fiscal agent and part of the New Jersey Department of Health
and Senior Services. Decision-making authority includes staffing, strategy evaluation, and communications
with partner organizations and public. Shared decision making with work groups regarding allocation
of sub-grants.
found that these tools increase the groups transbuild mutual accountability.
Pilot organizations report that as a result of their

new governance model, their boards have become
much more engaged in their work and more
passionate about their organizations strategic
direction and programs. As boards worked more
closely with stakeholders, especially constituents
5. Improved ability to engage in deep collaboration

with other nonprofits.
and key community leaders, they developed a
Pilot organizations report that by removing the
nity and a deeper understanding of the commu-
boundaries around the board and engaging stake-
nitys needs. The amount of transparency among
holders in decision making, they can develop
the board, staff, and other stakeholders also
new, deeper collaborations. In some cases,
increased. Those organizations that used social
this has resulted in networked governance
media and e-governance modalities also reported
joint governance decisions across numerous
a significant increase in transparency and, ulti-
organizations.
mately, accountability to their communities.
more meaningful relationship with the commu-
Other Key Learnings and Challenges with

Sharing Power
nonprofits in transforming their governance into
The action research also reveals that for many
mately, more focused on impacting the commu-
organizations, the identity of their constituents,
nities they serve.
one that is more inclusive, democratic, and, ulti-
community, and primary stakeholders is often
Although this
unclear. Establishing a shared understanding of
Acknowledgments
who their stakeholders are seems to be a key
The author would like to acknowledge the work
success factor. Also, an organizational champion
of the many members of the Alliance for Non-
demonstrates promising
with authority (usually the executive director or
profit Managements Engagement Governance
board chair) is ultimately needed to help lead the
Project/Governance Affinity Group, who have
benefits, the level of
process. Depending on their new governance
worked consistently over the past few years
change needed can
structure, some pilot organizations have success-
helping to shape this framework; Regina Pod-
fully included their staff in governance decision
horin, for her work with one of the pilot organiza-
be difficult for some
making, especially when the staff represented
tions; and Maria Elena Letona, for her invaluable
the organizations constituency. The success of
assistance with developing the framework and
staff involvement depends on the organizations
this article.
governance framework
organizations.
culture and mission. Another success factor is

the creation of a cross-sectional design or coor-
N otes
dinating teams to help design the new governance
1. The Alliance for Nonprofit Management is the
model for the organization.
premier national organization of capacity builders.
Although this governance framework dem-
wwww.Allianceonline.org
onstrates promising benefits, the level of change
2. Judy Freiwirth, Engagement Governance for Sys-
needed can be difficult for some organizations.
tem-Wide Decision Making, The Nonprofit Quarterly
Initially, boards need to be willing to try new, inno-
14, no. 2 (summer 2007): 3839;Freiwirth and Maria
vative frameworks and practices, a challenge for
Elena Letona, System-Wide Governance for Commu-
many boards. Many organizations are reluctant to
nity Empowerment, The Nonprofit Quarterly 13, no. 4
engage in the uncertainty and ambiguity that often
(winter 2006): 2427.
accompany transformation. Moreover, many
3. Beth Kanter and Allison Fine, The Networked Non-
boards will need to dramatically shift their per-
profit: Connecting with Social Media to Drive Change
ceptions of constituentsfrom a charity/deficit
(San Francisco: John Wiley and Sons, 2010).
perspective to one of constituents as invaluable
4. Patricia Bradshaw, A Contingency Approach to
assets for the organizations success. Sharing
Nonprofit Governance, Nonprofit Management &
powerboth the concept and its implicationsis
Leadership 20, no. 1 (2009): 6181.
perhaps the biggest hurdle for any board.
5. Rory OBrien, An Overview of the Methodological

Approach of Action Research (1998).
Promising Advancement for Nonprofit

Governance
6. Marvin Weisbord and Sandra Janoff, Future Search:
Although we continue to learn from our experi-
Commitment, and Action (San Francisco: Berrett-
ence and research, the Community-Engagement
Koehler Publishers, 2010);Juanita Brown, The World
Governance Framework demonstrates prom-
Caf: Shaping Our Futures Through Conversations
ising benefits for nonprofits and their communi-
That Matter (San Francisco: Berrett-Koehler Publish-
ties. We continue to look forward to feedback
ers 2005;Harrison Owen. Open Space Technology: A
from NPQs readership, and seek additional
Users Guide (San Francisco: Berrett-Koehler Publish-
organizations that would like to join this learn-
ers, 1997).
Getting the Whole System in the Room for Vision,
ing community and help advance the governance

field. We hope this new framework will not only
advance the movement toward more effective
governance models and practices but also assist
governance
Loyal
Op posi ti on
by Patricia Bradshaw, PhD, and Peter Jackson, CA
The true value of
governance lies
neither in leadership
nor in followership,
but in the unique role
of loyal opposition.
This concept of
parliamentary
governance focuses
on providing a
constructive critique
of the ruling partys
policies. Applied to
nonprofits, the authors
suggest that such
a function can be
instituted in several
places within an
organization.
Editors note: This article was first published in NPQs summer 2007 edition.
hen it comes to governance, boards
still not fully conceptualized. This lack of clarity
of directors tread a very fine line.
is problematic for individual directors striving to
Those who seek to lead the orga-
exercise due diligence and fiduciary responsibility
nization run the risk of usurping
and for regulators and quasi-regulators seeking to
the role of the CEO. Those who follow the CEOs
establish guidance on good practice.
lead run the risk of abdicating their responsibility
Certainly, it is no longer appropriate (if it ever
and joining the ranks of management. In fact, the
was) to rubber-stamp every senior management
true value of governance lies neither in leadership
proposal. But, boards that seek to exert more
nor in followership, but in the unique role of loyal
control and influence over the executive team may
opposition.
only escalate political maneuvering. As a result,
For many years, boards of directors of Cana-
power either remains with the executive team
dian corporations and public institutions were
or shifts into the hands of the boardor there is
criticized as being parsley on the fish (decora-
like-thinking among the two groups. While orga-
tive but not useful) or an old boys club, where
nizational politics are a reality, power struggles of
protection of fellow members and mutual back-
this type are detrimental to the boards ability to
scratching ranked ahead of any other obligation.
exercise its mandate most effectively.
Largely ignored by organizational theorists until
Rather than look at the role of the board of
ten or fifteen years ago, boards are now intuitively
directors, its helpful to focus on the functions
understood to be important, but their function is
of governance, leadership, and management. If

an organization is to operate effectively, each
P atricia B radshaw , P h D, is dean of the Sobey School
of these three functions must be performed by
of Business at Saint Marys University in Halifax, Nova
someone or some group.
Scotia, Canada. P eter J ackson , CA, is an independent
Organizational theory recognizes that the
consultant in Toronto. He is also CAmagazines technical
leadership function is about creating a trans-
editor for control.
formational vision of the direction in which the
P H OTO G R A P H : R E F U G I O
organization should be heading and telling the
prisona tunnel vision. Leaders become the hero
story in a compelling fashion. Power comes to
or heroine in the drama of their own creation. As
leaders who create a cohesive, inspiring story that
both the producer and the star, they cannot step
all will follow and believe, and strategic direction
back from the script that continually unfolds to
falls out of that vision. The more compelling the
see if the story line is still coherent. In a world
story, the less the vision is questioned and the
of uncertainty, rapid change, and environmen-
stronger the leader. John Roths ability to create
tal chaos, plots can quickly become outdated,
a story about Nortel that so few questioned or
but the writer may not notice. Business schools
doubted is an example of both the power of char-
teach case studies of companies that misread
ismatic leadership and the risks of being believed
changes in their environment, in technology,
help in monitoring
too much.
in the demographic profile of customers, or in
the increasingly
The management function is to implement
societys values. Aspiring managers are taught
the vision and bring the strategy into operation.
to monitor and scan their environment and also
unpredictable
Together, leaders and managers must ensure
to be self-critical and aware.
that stakeholders, both inside and outside the
The challenge, of course, is that a truly vision-
environment.
organization, see the strength and wisdom of the
ary and compelling leader has to believe his
direction established and that the confidence of
own vision. Ambivalence is quickly detected,
shareholders is never shaken.
and leaders who express doubt are accused of
Every strong leader

needs a sounding
board, an outside
mirror that will
So what is the function of governance within
not walking the talk or of not being strong and
this framework? Directors know that they should
dynamic. If you are seen as a winner and a leader
not meddle in management, but they might not
of distinction, it is almost impossible not to be
understand that governance is distinct from lead-
caught up in your own myth. We can say, Reflect,
ership. Many directors are also strong leaders in
be humble, share your weaknesses and be self-
their own right and may see little alternative to the
conscious, but this is asking leaders to be heroic
board fulfilling or supporting the leadership func-
beyond what is reasonable or even realistic. One
tion. Well-intentioned, sincere, and committed,
person simply cannot do it all.
they slide into the leadership function by creat-
Instead, every strong leader needs a sounding
ing the vision themselves or by guiding the CEO,
board, an outside mirror that will help in monitor-
especially if the CEO is seen as weak.
ing the increasingly unpredictable environment.
The function of governance is to protect
Reflection and questioning, reframing and reas-
the organization from a too-successful leader-
sessing are key responsibilities of the governance
ship role. The compelling vision created by
function. Therefore, a boards performance of that
a charismatic leader can become a type of
function can challenge the leaders vision, ask

whether it is in alignment with the environment,
assess the risks implicit in it, and obtain assur-
The concept of loyal opposition means being opposed to the actions of the govern-
ances that management is implementing it effec-
ment or ruling party of the day without being opposed to the constitution of the
different interpretations of the script. The story
tively. A board can also confront the leader with
political system. In Japan, the United Kingdom, and many other Commonwealth
line will grow stronger and more compelling as
countries, the leader of the party possessing the largest number of seats in Parlia-
on the meta-level critique of the board of directors.
ment while not forming part of the government is termed the loyal opposition.
Their constitutional function is to scrutinize government legislation and actions.
the leader defends the vision and adjusts it based

Governance should be a radical function
that seeks to challenge the root assumptions
of leadership, to address those matters that are
While frequently opposing the ruling party policies at every turn, the leader of the
normally taken for granted or are not discussed.
opposition is not opposed to the governments right to rule.
Governance involves deconstruction of the deep

structures of power (the glass ceilings, the unspoken privileges, the inequities that are so familiar
Where Loyal Opposition Fits
Stakeholder
relations
Leadership
(championing)
Management
(implementing)
Governance
(challenging)
Align dominant
stakeholder coalitions
Inform stakeholders
Scan stakeholders and

represent views
Tell and sell the vision
Implement the vision

and give feedback
on progress
Challenge the vision
Exercise power and

reinforce existing
structures
Be accountable and
require accountability
from subordinates
Expose and question existing

power structures
Vision
Power
Governance should be a
radical function that
seeks to challenge the
root assumptions
as to be invisible). It involves generating alterna-
Employees, for example, can deliver invaluable cri-
tive visions or scenarios and testing to see if they
tiques of the existing vision (if the leader is humble
are more robust and resilient than is the current
enough to listen), based on their day-to-day, front-
vision. It also involves asking what-if questions
line experience in working with customers, suppli-
and celebrating diversity and multiplicity of views.
ers, competitors, and other critical stakeholders.
A robust governance function is a challenge to
As well, different organizations at varying stages
the vision from which the leader derives power,
of development may assign functions differently.
and some leaders may find this personally threat-
For example, a volunteer-driven nonprofit agency
ening. Loyal opposition is not always voiced in
may have members of its board of directors play a
friendly tones, but the clash of opposing ideas
key role in shaping the organizations vision. There
can be as productive as sotto voce suggestions.
is nothing wrong with that, as long as the board
Far greater than the risk of offended sensibilities
recognizes that it (or someone) must also step back
is the risk to the organization when no governance
into the governance challenge role.
function is being performed. Governance is absent
However, board members should examine the
if the board sets the direction and fulfills the func-
governance function of their organization and
tions of leadership itself, or if the board and execu-
assess whether it is being performed adequately.
tive share the leadership, or if the board merely
In these increasingly uncertain times, both strong
rubber-stamps the executives vision. No gover-
leadership and engaged, effective governance are
nance is being performed if the board unquestion-
required, as is diligent management. Leadership,
ingly believes the vision and sees it as an objective
management, and governance must be brought to
reality. The outcome is an organization that risks
bear on the key aspects of work throughout any
being limited by an outdated view of the world,
organization.
of leadership.
under a leadership blind to certain events taking

place around it.
Top management is not the only place where
leadership functions can be performed; middle and
Reproduced with permission from CAmagazine,

published by the Canadian Institute of Chartered
Accountants, Toronto.
lower management are not the only place for performance of management functions, and the board
of directors is not the only place for governance.
Each function can be performed at many levels.
governance
Board Stories
Involving Humans
by Ruth McCambridge
How is it that a
ragtag board can
Editors note: This article was first published in

NPQs summer 2007 edition.
effectively support its
organization while
a picture-perfect
board fails miserably?
The answer to this
roup decision making is as old as tribal
councils, used by societies in every

century on every continent. Even in
ancient times, tribes and clans del-
egated some decisions to the deliberation and

exchange of a leadership group, which (when they
conundrum lies not
work well) can lead to better and more widely
in the structures
accepted decisions.
Present-day decision-making groups share
but rather in the
many of the goals of the prehistoric wise councils
mix of personal and
assembled around the campfire and seek to build
group chemistry and
their own traditions, legitimacy, and experience.
the skills of board
challenges of consensus building, politics, and other
But humans being humans, all such groups face the

hurdles common to the decision-making process.
members to interact
Recommendations on board recruitment often
with constituents and
suggest that people are essentially interchange-
each other, keeping
training. Plug in an accountant, a lawyer, a human
able parts, only differing in their professional
and maintaining
resource professional, a number-savvy business
the work of the
time on their hands; schedule some meetings; and
drone, and some other good-hearted souls with
organization intact and
let the governing commence!
a singular priority.
ceral connection of lived common cause. There is
This strategy, of course, provides little of the vissomething random and naive about the way many
organizations go about building their boardsand
it shows. Even in the most institutional of nonprofit
R uth M c C ambridge is the Nonprofit Quarterlys editor
in chief.
P H OTO G R A P H : J U E G O
boards, with a standardized board design and
week to the organization. Few of these volunteers
plenty of administrative support, it is not unusual
have overwhelming individual influencethey
to find trustees in a kind of mild-to-severe fog.
are a motley crew, from full-time students to car-
A survey by the Chronicle of Higher Education
penters and accountantsbut the board can and
finds that 40 percent of university trustees admit
does mobilize on a moments notice. The board
to feeling slightly or not at all prepared to carry
is not always in accord. There are no term limits:
out their duties. No organization would aspire to
when board members object to the organizations
this state of affairs at the staff level, yet an ener-
direction, they vote with their feet. Decisions
getic but badly focused board member can lever-
are made by modified consensus. To outsiders
age more control and cause more disruption than
the board structure might seem untenable, but it
realities of life for
most staff. And a low-energy board is just a drain.
has some characteristics that make it work quite
the women whom
In what ways do nonprofits need to elevate the
well: all board members have the common experi-
thinking about the development of their boards?
ence of having participated in a 36-hour training
the organization
Do we focus on the wrong stuff? This article sug-
program that focuses not only on the practice at the
gests that we do and presents a series of stories
shelter but on the theory behind the practice. This
serves, because
that focuses the reader on critical but neglected
is required for any volunteer (and therefore any
aspects of board development.
board member), and all board members have direct
What makes this

board work? Each
board member is
well versed in the
board members
have actively
learned about
these challenges.
experience with the women who stay at the shelter.
Those Pesky Human Beings
What makes this board work? Each board
No [board] design is automatically great, says
member is well versed in the realities of life
David Renz, a national expert on nonprofit boards.
for the women whom the organization serves,
Its just a start, and then you add the peopleand
because board members have actively learned
then it often gets really weird, and thats the way
about these challenges. They watch how situa-
it is. Structure does not and cannot guarantee
tions unfold over time, the womens interactions
performance, although it can certainly get in the
with the police, the courts, the schools, and their
way. The reality is that a group of talented and
batterers. They are adept at judging the impact
committed people can make even the lousiest
of budget decisions and organizational strategies
structure work because they develop processes
because they have this knowledge and because
sometimes very informal onesto get around the
their training gives them a grasp of program
flaws. The same is true in the reverse, of course:
options in general and puts the theory of this par-
a talented group driven more by individual ego
ticular program in context.
than collective mission can make even the most

rational of structures a joke.
This board framework would not work everywhere, but it has some intriguing elements in
This observation probably resonates with
terms of board members deep understanding of
many readers and explains in part why simple
program, constituents, environment, and a design
structural approaches to board development so
that is well suited to the particulars of the orga-
often fall short of desired outcomes. Is it pos-
nization. A description of the structure sounds
sible that the characteristics and orientation of
ominously untenable to many. But when this
board members matter more than skill sets and
organization suddenly lost most of its funding,
contacts? The answer to this question might actu-
the board mobilized itself and all of its friends
ally excite us out of rote stupor, revealing more
and, within six months, had significantly improved
potential for the diversity of board design.
the organizations financial position from where

it was pre-crisis.
Constituents Above All Else

midwestern town has a sixty-member board that
Agreements on the Focus and Role of the

Board Are Mutable
is consensus based and comprises only active
The Sailors Beacon Preservation Group is dedi-
volunteers, who contribute at least four hours a
cated to restoring and maintaining a lighthouse
A battered womens shelter based in a small
in the Pacific Northwest. The board is a mix of
accountability with its publics, its mission, and
local blue- and white-collar professionals, includ-
among each other.
ing fishermen, architects, insurance agents, and
Again, this structure doesnt work in every
farmers. The organization has a strong founder
organization. But according to the organiza-
who is now the executive director, and the board
tional consultant hired to improve the maritime
struggles to provide a balance through its gover-
nonprofit, when the board placed the mission at
nance function. Some new board members rotate
the center of the conversation, everything else
out quickly in frustration over a lack of board
fell into place. Each board fits its nonprofit in a
control, especially if they have had experience
slightly different way, and many board types and
on other boards. Others remain on the board for
patterns work. In some cases, the fit may work for
many board types
years at a timethere are no term limitsand are
a while and then need some revision. This is not a
highly engaged in helping the grassroots effort
failure unless we cast it that way. If anything, the
and patterns work.
to maintain the lighthouse and develop educa-
sector is lacking in creative board design.
tion programs for the public on maritime history.

These board members provide flexibility for the
Negative Effects of a Well-Intentioned Structure
strong founding leader and engage in high-level
The board of a statewide coalition of local activist
conversations that ensure a focus on mission.
groups meets quarterly, often just barely making
They sometimes lock horns with one another
quorum. Among the board members, levels of
or with the director, but in general the board
knowledge, energy, and interest vary considerably,
members who stay enjoy serving on a board that
which is not surprising given that the coalitions
has developed a culture that reflects the needs of
thirty-plus member organizations each appoint a
the lighthouse and of the public.
representative, some of whom care deeply about
This group was not always effective in its gov-
public policy and some of whom are just plain
ernance role, however. During the mid-1990s,
uninterested. There is also a mix of executives
there was intense conflict between the found-
and line staff members on the board, reflecting the
ing executive director and board members, who
orientation of the member group to the coalition.
wanted to share the reins. An organizational
Meetings take place in the middle of the state and
consultant helped the board with some classic
often start late because of the delayed arrivals of
role definition, enabling members to recognize
the less motivated. The coalition spends a lot of
that there was quite a bit of board business that
time and psychic energy on dead-end discussions
they had neglected, and that they could strike a
and on conflicts among the members. Sometimes
balance if they defined their governance work
individual board members bring their conflicts
within parameters rather than focusing solely on
with their home groups to the meeting, which only
the work of the executive director. There was a
confuses things. Members often resort to recit-
seminal planning meeting on a cold winters day
ing the bylaws to one another. Still, the coalition
at the lighthouse, where the board and executive
gets the work done, breaking new ground in law
director agreed to a strong vision and mission.
and policy and lobbying successfully for funding
For the next decade, board members were deeply
streams. Its accomplishments are attributable
oriented toward the mission, and every board-
in part to a small group of committed staff and
room decision was made with this mission as the
also to a small core of active board members and
key screen. Finally, the group created an annual
independent stakeholders. Participation may not
check-in on its own performance and worked to
be equal, but invested groups create organizing
improve the governance function. The strong-
capacity sufficient to the statewide purpose of
minded executive still posed some challenges to
social change.
work with, but rather than tear and claw at the
This example raises the issue of appointed
strengths of the founder, the board strengthened
board members, which over time often looks much
its own role, held itself accountable, and worked
better in theory than in practice. The idea behind
to improve itself incrementally and to create
appointing board members is that certain kinds of
Each board fits its

nonprofit in a slightly
different way, and
In some cases, the fit

may work for a while
and then need some
revision. This is not
a failure unless we
cast it that way.
We have all seen these

appointed and partially
appointed boards
flounder and fail, but
organizations need buy-in from other partner orga-
that included members appointed from agencies
nizations for their boards to function well. This
that were the target of the groups criticisms. But
leads some small-scale social engineers to require
the private funding source involved saw inclusion
that seats on the board be reserved for appointed
as a way of selling the idea to the then-adminis-
members from those organizations. This struc-
trationwhich changed after the next election,
ture does not, of course, indicate whether there is
of coursealong with agency heads.
any heartfelt participation among individuals or
We have all seen these appointed and partially
whether there is any chemistry of mutual attrac-
appointed boards flounder and fail, but precious
tion to a goal that makes a group really sing.
little research has been done on this design issue,
In Boards Behaving Badly, Owen Heiserman
and little in general has been written about it.
precious little research
discussed the unfortunate legacy of a mandated
Again, a few committed humans can overcome
has been done on this
policy of inclusion in community antipoverty
these kinds of structural barriers, but it almost
agencies. One national organization I know of
always means that an organization has a titular
design issue, and little
said it was fine idea, as long as the board retained
board and a group of behind-the-scenes players
its original liaison board members. But with each
who make things happen.
in general has been
successive representative, the purpose of board
written about it.
membership became more vague; indeed, showing
Imprisoned by Board Culture
up at all was more about what a representative
The board in a low-income community organiza-
was required to do for the home-appointing orga-
tion is a stickler for process. Forty years ago, the
nization than about a sense of commitment to the
organization started out as an innovative collec-
organization. This is clearly not a good dynamic
tion of community activists, but now it offers a
for any board, and it creates a two-class system
standard menu of service programs whose param-
of board members. In this case, the result was
eters are defined by the state. Board members are
pretty much the antithesis of the womens shelter
recruited for their technical skills and their politi-
board mentioned previously: distantly connected,
cal and social contacts. The board is dysfunctional,
unmotivated, and uninformed members do not an
with opposing cliques attempting to capture new
exciting board make. Its not that appointed board
members to their point of view. Mean-spiritedness
members are necessarily a bad thing, but they
is the order of the day. Each meeting starts with a
bring some significant challenges to team building.
lavish dinner and then the presentation of an exec-
If appointed board members come from an
utive report, which is usually lengthy and defen-
agency that funds the organization, it can add
sively structured. Defensiveness is reasonable,
another layer of complexity. Another organization
considering that board performance reviews of
I encountered was established with an appointed
the executive are either overly effusive (during the
board comprising middle-management staff in
honeymoon stage, the new executive director is
state agencies that work with women making the
greeted as organizational savior) or highly critical
transition from welfare to work. The charge of the
(once the director has inevitably fallen from the
organization: advocacy for better practice at those
perch), with great detail provided on the execu-
agencies. The organizations first director was a
tives failings. Formal language and Roberts Rules
tireless critic of the unwillingness of state agen-
paper over any acknowledgment of the depth and
cies to cooperate with one another. But at some
chronic nature of the boards problems. Execu-
point they proved him wrong with a well-coor-
tive staff at the CEO and CFO levels circulate in
dinated campaign to oust him from his job. The
and out of the agency through a revolving door,
organization then limped along as a service group.
often leaving tangles of financial and relationship
State-agency representatives stopped coming to
problems with funders.
meetings, and eventually the mandate for their
What makes this board malfunction? During
participation was removed from the organizations
its formative years, two well-respected individu-
bylaws. Certainly, questions should have been
als led the organization. The board supported but
raised up front about the sustainability of a board
also depended on them as the glue and public
face of the organization. Subsequent executives
even when that means repetitive failure. Does the
were less able to bring cohesion or excite loyalty
board tend to lead, or does it follow a strong exec-
from the board as a whole, and the board inevi-
utive? Does the board appoint members, or does
tably splintered into two camps: one for and one
its membership elect board representatives? Not
against whoever happened to occupy the execu-
only do these questions matter, but the stories that
tives chair at the time. Thus the boardroom is a
explain how the organization arrived at its present
space locked in conflict and fraught with danger.
state also matter.
Look around any

community, and you will
People either stay out of the line of fire or join a
Cultural attributes cannot always be struc-
side. Real conversations take place in the parking
tured in or out, but acknowledging them provides
lot on the way out. No amount of retreat is going
a board with more control. As Edwin Nevis, the
boards; focused, aligned,
to affect the tenor of the room until those who
president of Gestalt International Study Center,
inhabit it admit that they are the problemand
says, Awareness is the precursor to effective
thoughtful, and mission-
thats a tall order. After all, they are volunteers and
action. Awareness leads to choice.
each of them, with some legitimacy, views himself
I have discovered that people can be shy about
as a community-minded individual. As members
naming such stuffopting instead to banish a few
squabble with one another, many of the programs
purveyors of disturbance from the roomonly to
and relationships with funders are in a free fall.
find this troublemaking mysteriously replicated
This board is in the habit of offloading responsi-
by others shortly thereafter. You may recognize
bility and has instituted a Love ya now, hate ya
this dynamic from family systems therapy. The
later cycle with all executives. A steady stream
board is, after all, a group of human beings.
see sad boards; happy
centric boards; pedantic,

self-satisfied, and
tiresome boards; sloppy
boards; and obsessivecompulsive boards.
of consultants enters and leaves without effect.

Look around any community, and you will
There Is No Away
see sad boards; happy boards; focused, aligned,
One NPQ reader writes: There is a bit of a discon-
thoughtful, and mission-centric boards; pedantic,
nect in the cultural approaches [between board
self-satisfied, and tiresome boards; sloppy boards;
and staff]. Its not a real issue, but my board does
and obsessive-compulsive boards. When humans
not play a major role in the heart of the organiza-
come together, they create a whole of the parts,
tion. While I could recruit new board members
which can seem confounding when the whole is
onto our board who think differently, I also have
much less than the suma common complaint of
to keep our public credibility in mind. Its very
boards. But the group may have created its own
handy to have a well-respected lawyer or busi-
invisible limitationsa very human characteristic.
nessman on the board for that reason. It does not
There is little attention paid to the gestalt
feel right, in terms of our real ethos, so its a fudge.
of boards, but of course each board has one. A
[I] dont know what the solution is yet.
gestalt involves three sets of attributes: the entity
One rule of systems thinking is that there is no
in all its own complexity, the entitys context, and
away. If we dump hazardous waste, it will come
the relationship between them. So an organiza-
back to haunt us. The same goes for sliding our
tional gestaltand when it is functionally sepa-
boards to the side. We are often confused when
rated, a board gestaltcan reflect the culture of
staff acts out of one set of motivations and the
the organizations sector, its geographic area, the
board out of another. Sometimes this is a function
governance preferences of the local United Way,
of a boards belief that it should take a certain
or all of the above. It can also be deeply affected
stance to counterbalance staff behavior, but
by the creation story of the organization. Did the
sometimes it is just a function of relative isolation
organization have to fight its way into existence?
(which can easily happen if the executive is the
Was it the product of a large, ill-informed grant
only point of contact). This dualityand the ten-
from a national foundation that later abandoned
dency of boards to be insufficiently familiar with
the infant effort? Human beings tend to carry
the details of the work of the organizationoften
epic stories forward as fables with morals, and
leads to executives attempts to manage (read:
they will force-fit outcomes to their expectations,
marginalize and contain) the board.
It has always struck

me as next-to-insane
to bring people onto
a board when they
have no significant
experience in the work
of the organization.
An attempt to manage the board often leads
of the organization. Three months of volunteering
to its members being the last to know about orga-
at the shelter sorted out who worked well with
nizational problems. The programs can have a ter-
others. And, as Harrison and Murrays article on
rible reputation, the funders can lose trust, and
page 86 notes, the characteristics of the board
the surrounding community may have an opinion
chair are particularly important. In the case of
of the organization that belies its mission inten-
the shelter, the board chair was an unassuming,
tionswithout the board really accepting that this
humble woman, respectful to everyone, not a
is the case. The board may have a heroic view of
gossip, quick to laughbut steady as all get-out.
the organization, even if that view coexists with

a sense of discomfort about things left undone.
In Conclusion
This, of course, can lead to a revelatory
People are strange: some for better and some
moment when the board finally hears negative
for worse. So it has always struck me as next-to-
information that has been building over time. Such
insane to bring people onto a board when they
revelatory moments can be brutal and bloody. In
have no significant experience in the work of the
one case, the attorney general cited an organi-
organization. Its a swift way to borrow trouble.
zation for a questionable fundraising strategy
How do we know how they work in a team setting?
after the board had been told repeatedly that the
Do they like to build cliques and secret allies, or
organization might have hosted a wealth of other
do they care enough about the work to spend
ethical lapses. But it was not until the staff led an
time selflessly on it? What better way to test such
open rebellion that the board had an epiphany.
things than to organize people into working com-
Until the mutiny, the board acted as though it had
mittees. Do they produce? Do they follow through
been unfairly singled out by the IRS and that the
and bring others to the work? Are they self-aware
internal alarm sounders were merely expressing
or quick to defensiveness (Who are you calling
personal agendas. Board members took no steps
defensive? Im not defensive!)?
to ensure that protective protocols were in place.
Creating committees that involve people who
On the other hand, a failure to manage how a
are interested in what you do and are well charged
board receives and interprets information may
has so many benefits. But among them are more
cause its members to focus on relatively unim-
advocates, more long-term donors (volunteers
portant details and lose sight of core organiza-
tend to give), more creativity, and more connec-
tional strengths. Executive directors worry that
tions. Such committees make the organization
their boards wont balance the big picture with
more dynamic and give it higher profile, and they
the details. This inability to rank organizational
are a wonderful testing ground to identify those
issues can waylay an organization, sometimes
humans who can be trusted to be thoughtful,
interminably, and thats why the basic proposi-
enthusiastic stewards.
tion of the policy governance model is inviting to
Here is my first suggestion: build these com-
some boards and executives (a colleague recently
mittees, and dedicate real staff time to them.
described the Carver method to me as the execu-
Make them a part of your engagement strategy.
tive empowerment model).
Mix up the members between staff, constituents,
For an executive to feel comfortable in relin-
and interested others, and watch who rises to the
quishing the bad habit of managing the board,
surface as a prospect for board service. Use them
he must depend on the board chair and commit-
to encourage the appropriate mlange of commu-
tee chairs to frame and manage conversations,
nity activists and leaders who might productively
and that requires that the character, background,
populate a board that can be trusted with the orga-
and, most importantly, the alignment of board
nizations future.
members with the mission are primary criteria
My second suggestion is to think more cre-
for recruitment and leadership. The womens
atively about governance in general. What role
shelter exemplifies this principle. All its board
could it ideally play in your organization, and what
members were steeped in the theory and practice
board design facilitates that? Get past the default
mind-set of boards must do this and boards
need but to what the dynamic in the boardroom and
should do that to find the truly imaginative and
between the board and the executive needs to be to
inspired functions your board can and should
get the work done in the most optimal way possible.
fulfill. Most obviously, dont rely on fundraising
Finally, the dedication of each board member
prowess and connections as the lens for board
to the accomplishment of the mission and best
recruitment. You may be conditioned to believe
interests of the organizations constituents should
that connections are your key to a healthy budget,
be unquestionable. This is hard to ensure without
but recent research finds no proof that organiza-
each board members having spent considerable
tions that recruit for connections are any better
time in the work of the organization and with a
off than those that do not. Moving away from a
variety of constituents. It only makes sense to
myopic focus on rote board functions can reveal
create testing grounds elsewhere in your organiza-
potential for additional board contributions
tion for the quality decision makers and advocates
beyond fundraisingand the strange, wonderful,
you really need on your board.
and insightful people who might be recruited to

realize these board visions.
There is lots of room for variation. Little is
N otes
1. Jeffery Selingo, Trustees: More Willing Than Ready,
written in stone regarding the shape and use of
the Chronicle of Higher Education, May 11, 2007.
boards. Yet decades of consulting would have
2. Owen Heiserman, Boards Behaving Badly,
groups believe otherwise, and so good people
the Nonprofit Quarterly 12, no. 2 (2005), www
waste inordinate amounts of time trying to fit
.nonprofitquarterly.org/section/727.html.
their unique organizational cultures into prescriptive models. Governance is not a structure but a
process. That process must remain responsive not
only to what the constituents and the organization
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Office Address
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governance
The Best and Worst

of Board Chairs
by Yvonne D. Harrison and Vic Murray
Respondents
perceive highly
effective chairs
as assets to their
organization.
Conversely, they
view ineffective
chairs as
problematic for
boards and for the
organization as
a whole.
Editors note: This article was first published in NPQs summer 2007 edition. A new conclusion
brings the research up to date.

ost experienced observers of non -
Our research identifies three groups on which
profit governance agree that board
board chairs have influence: (1) other board
chairs can have considerable influ-
members; (2) CEOs and management teams;
ence on board operations. But not
and (3) external stakeholders, such as funders,
much research focuses on the critical position of
regulators, and clients. Although our exploratory
board chairmanship and the factors that deter-
research doesnt touch on this, we have devel-
mine its potential for positive or negative impact.
oped a framework that outlines the factors that
To better understand how board chairs affect
might shape the behavior of chairs, such as back-
their organizations, we recently completed two
ground (i.e., age, gender, education, and previous
phases of a research project (and have plans for
leadership experience); characteristics of other
a third). In 2006 we undertook the first phase of
members in the relationship, such as the CEO;
this pilot study, conducting in-depth interviews with
and characteristics of the organization (such as
twenty-one respondents in Seattle, Washington, and
the age, mission, and culture). The organizations
in Victoria, British Columbia. Respondents were
larger environmentsuch as economic and politi-
split nearly evenly between experienced nonprofit
cal factors, the organizations climate of competi-
board members and CEOs. In 2007 we launched
tiveness or cooperativeness, and so oncan also
the projects second phase, which consisted of an
affect board chair behavior.
online survey of 195 nonprofit leaders representing

a variety of perspectives (including those of board
Phase-One Findings
chairs, board members, CEOs, staff service volun-
Our preliminary research findings suggest that
teers, and stakeholders) from across the United
there is considerable commonality among those
States and Canada to verify the results of the study.
qualities respondents perceive as hallmarks of

effective and ineffective chairs. Respondents
Y vonne D. H arrison is an assistant professor in the
perceive highly effective chairs as assets to
Department of Public Administration and Policy at the
their organization. Conversely, they view inef-
University of Albany, State University of New York, in
fective chairs as problematic for boards and
Albany. V ic M urray is an adjunct professor in the School
the organization as a whole. The table on
of Public Administration at the University of Victoria,
pages 8889 features some of these common
British Columbia, Canada.
characteristics.
P H OTO G R A P H : S TA N D I N G R O O M O N LY
The Highly Effective Chair*
The Highly Ineffective Chair *
The Chairs Attitudes and Values (as perceived by board members and CEOs)
Is committed to organizational mission; is passionate, enthusiastic,

and engaged
Is knowledgeable about the organizations activities and challenges
Can see the big picture
Is too focused on details and unable to see the big picture

Doesnt convey a commitment to the organization
Uses the board chair position mainly to advance personal career or
agenda
The Chairs Personality Traits (as perceived by board members and CEOs)
Is charismatic and communicates a broad vision with which others

can connect
Is extroverted but not bombastic; is at ease with people of all types
Is trustworthy and calm
Is egotistical and dictatorial (ineffective chair personality type one)

Is introverted and well meaning but unable to inspire others; is
uncomfortable in a leadership position (ineffective personality
type two)
Is intelligent and grasps complex situations quickly

Has a sense of humor
The Chairs Conduct (as perceived by board members and CEOs)
Is proactive; takes initiative in raising issues
Listens poorly
Takes time to interact with others; doesnt rush others
Doesnt take sufficient action
Listens, doesnt argue or criticize
Micromanages
Clarifies and helps to redefine issues
Vacillates and takes different positions depending on whom s/he

interacts with last
Finds common ground when differences arise; manages conflict

well
Creates or avoids conflict
The Chairs Qualities (as perceived by CEOs)
Mentors and coaches other board members
Doesnt respect or trust the CEO
Is always available when needed
Tends to be critical and unsupportive
Is nonjudgmental and collaborative

Is always enthusiastic about the organization
The Chairs Relationships with Board Members (as perceived by board members)
Is always well prepared for meetings
Chairs meetings but fails to lead
Conducts productive meetings that are on topic, on time, and

action oriented
Runs meetings poorly, is disorganized, and allows meetings to

drift from the topic
Is clear about the role of the board and can communicate it to

others
Contributes to confusion over the boards role
Serves as a facilitator rather than a superior

Delegates and works as a team player and team builder
Makes individual board members feel valued and appreciated
Isnt proactive; doesnt focus on key issues, and avoids confronting

problems
Is too protective of the CEO and staff; doesnt push the board to
assess the performance of the organization or itself
The Highly Effective Chair*
The Highly Ineffective Chair *
The Chairs Relationships with Stakeholders (as perceived by all respondents)
Has strong contacts with key people outside the organization
Isnt proactive in reaching out to stakeholders
Is willing to use contacts to help the organization
Doesnt have, or make use of, external contacts

Uses the board chair position for personal benefit
The Chairs Impact on the CEO
Increases the CEOs feelings of competence and boosts morale
Increases turnover of valued staff
Contributes to the improved decision making of the CEO
Inhibits needed change; contributes to the slow death of the

organization
The Chairs Impact on the Board
Ensures that meetings are focused, efficient, and produce clear

decisions
Increases board commitment to the organizational mission
Increases board turnover

Fails to resolve major problems, such as a poorly performing CEO or
lost funding, until its too late
Produces clear plans

Reduces unwanted board turnover
Attracts high-quality members to join the board
The Chairs Direct Impact on Stakeholders
Facilitates funding by helping to get grants or contracts
Loses the support of key stakeholders
Improves relationships with existing or potential partners

The Chairs Indirect Impact on the Organization
Takes the organization in a new direction

Creates a paradigm shift in the organizations thinking and
behavior
Saves the organization from insolvency by helping it to renew a
major grant
Respondents did not provide examples of the behavior of ineffective chairs resulting in serious damage to the organization. The
direct impact cited above can do larger damage, of course, but
respondents indicate that problems were fixed before permanent
damage was done.
Helps improve staff morale

*Responses indicated greater diversity when respondents were asked about their experience with ineffective chairs; responses for effective chairs were more uniform.
5. Ability-to-influence competencies:
Experience Base of Respondents to the Study

Respondents in the first set of twenty-one interviews had a minimum of five years of
experience in their role and had worked with at least three board chairs. These respon-
Has connections and influence with key

people
Uses connections to advance the organization
The two lowest-rated characteristics of board
dents came from a diverse group of organizations in terms of organizational mission,
chairs were combined to form one indicator of
budget size, staff size, and dependence on volunteers. In our subsequent online survey
chair ineffectiveness, which we call dominating
of 195 nonprofit members in the United States and Canada, a majority of survey
behavior:
respondents reported they had interacted with at least three different board chairs.
Is dictatorial and domineering

Pursues a self-serving agenda rather than contributing to an organizations well-being
Findings from the Online Survey
Discussion
In terms of the personal qualities of exceptional
This article highlights the characteristics of highly
board chairs, the findings of the online survey
effective and highly ineffective board chairs as
mirror first-phase findings. Trustworthiness, intel-
perceived by those who work with them. The
ligence, and good listening skills are the highest-
behavioral and personality characteristics of
rated qualities for board chairs; being dictatorial,
highly effective chairs are remarkably similar
critical, and motivated by self-interest are the
among the various groups of respondents to the
lowest-rated qualities.
online survey.
With the benefit of a larger database, we used
Respondents highlight the same qualities and
factor analysis to identify which characteristics of
skills of effective chairs as those the literature
effective and ineffective chairs hang together. Our
cites as desirable characteristics of nonprofit
analysis yielded five clusters of effective board
leaders in general. Our findings are also consis-
chair leadership characteristics and one cluster
tent with several leadership theories. Ralph Stog-
of qualities common to ineffective chairs.
dill, for example, suggests that effective leaders
1. Relationship competencies:
are charismatic, cooperative, and sociable and
Is flexible
know how to influence others, while Shelley Kirk-
Is comfortable with people of all types
patrick and Edwin Locke cite cognitive ability,
Is nonjudgmental
motivation, and confidence as essential leadership
Has strong listening skills
qualities. The literature also cites the following
Has a calm demeanor
characteristics of effective leaders, which parallel
Has a friendly persona
our findings:
Is humble
Being goal directed
2. Commitment and action competencies:
Having emotional maturity, self-awareness,
Has a strong commitment to the organization

Has a clear commitment to getting things
done
Uses a proactive approach
tional intelligence)
Being creative, flexible, and persistent
Being committed and independent-minded and
Devotes time to the organization
understanding the big picture; being compas-
3. Analytic skill competencies:
sionate and proactive (also known as spiritual
Can see the big picture
intelligence)
Can clarify and resolve issues
and social awareness (also known as emo-
Our findings are also consistent with the
Can handle contentious issues
findings of Richard Leblanc and James Gillies,
4. Willingness to create competencies:
who conclude from a 2005 study of thirty-nine
Has high intelligence
corporate boards and interviews with 194 board
Is an innovative thinker
members that there are two types of board
Has confidence
chairs. The first, which the authors refer to as
conductors, are effective managers because
that the person holding such a position would
they
move into the chair position within a year or two.

Those in such roles can then consciously under-
[R]elate very well to management, have a
study the chair role.
keen interest in good governance and serve as
Finally, it is possible to improve the chances of
the hub of all-important board activity. They
selecting top-notch chairs if boards are willing to
understand group and individual dynamics
carry out formal evaluations of their own perfor-
and possess remarkable leadership skills,
mance. In such a process, members can be asked,
both inside and outside the boardroom. They
Which board member do you think has the great-
relate exceptionally well to the CEO (if a non-
est potential as a future chairperson, and why?
It is possible to
improve the chances
of selecting top-notch
chairs if boards are
executive chair), committee chairs and other
In short, the secret to consistently appointing
directors. They lead the setting of the agenda,
highly effective board chairs lies in making the
run meetings effectively, moderate discussion
process more formal and thoughtful by identify-
formal evaluations
appropriately, manage dissent, work towards
ing the kind of person you want and by making a
consensus and, most importantly, set the tone
conscious effort to find and develop that person
of their own
and culture for effective corporate governance.
for the role.
The second type, known as caretakers, are
Five Years Later
ineffective because they either exert too much
While our research answered important ques-
influence or not enough.
tions about the leadership of chairpersons of
willing to carry out
performance.
nonprofit boards of directors, research since
So What? The Practical Implications
this time has explored which of the influences
The aim of our research was to learn more about
described in this article were the most important
the characteristics of outstanding board chair
in explaining chair impact on nonprofit boards,
leadership. But we can also draw some conclu-
CEOs, and organizations. The most powerful
sions about how a nonprofit organization can
explanation of chair impact comes from the
better select highly effective chairs.
interactions between multiple influences, sug-
The most important step is to develop a posi-
gesting that chair leadership effectiveness is a
tion description for the chairs role. This should
multidimensional leadership construct. We have
include specific responsibilities of the position
incorporated chair leadership into our board gov-
vis--vis (a) the board, both as individuals and as
ernance effectiveness research. The purpose of
a group during formal meetings; (b) the CEO and
this research is to increase the capacity of boards
other members of the management team; and (c)
to identify issues that challenge governance
external stakeholders. The results of our research
effectiveness, help boards process this informa-
can serve as a foundation for the elements these
tion in order to make the best use of the results
statements should contain.
in board performance decision making, and
A position description should also include the
determine the efficacy of the online performance
qualifications for the job, such as the required
assessment system in facilitating board and orga-
level of knowledge about the organization as well
nizational change. To access this free service and
as the desired leadership characteristics and inter-
University at Albany, SUNYsponsored board
personal skills. Again, the results of our research
research and development project, visit www.
provide some guidelines on the kind of person
boardcheckup.com or contact Professors Harri-
one should look for.
son (yharrison@albany.edu) and Murray (vmurray
One of the best ways to develop qualified board
@uvic.ca) directly..
members for promotion to the chair position is by

establishing a clear system of succession. Future
chairs would be appointed to the position of chair
elect or vice chair. The understanding would be
governance
New Frontiers and Critical Questions:
Moving Governance Research Forward

by Fredrik O. Andersson
By recognizing that
governance is not the
exclusive domain of
boards, and that such
emerging trends as
multilevel governance,
hybrid organizations,
and social
entrepreneurship
continue to change
the landscape of
nonprofit governance
as we know it, we
may be better able to
understand what it is
that enables nonprofits
to succeed.
ver the last two decades, scholars and
Boards are structures that exist to govern, but
practitioners have attempted to under-
the board and its members can engage in mul-
stand and explain what enables non-
tiple roles and responsibilities within a nonprofit
profit organizations to succeed. A key
organization. Governance, on the other hand, is
conclusion emerging from these efforts is that
a process involving several functions and several
governance represents an essential dimension in
stakeholders. For some time now, leading non-
nonprofit leadership, and that the boards engag-
profit scholars have highlighted the danger of
ing in the work of governance are pivotal to the
equating boards with governance, and argued that
success of the organizations they serve. As a con-
we must embrace a broader conceptualization of
sequence, both academic and practitioner inter-
nonprofit governance.1
est in boards and governance is on the rise, and
Working with a wider conceptualization of
several insights into the complex and dynamic
governance means accepting that a variety of
world of governing boards and governance have
actors outside the boardroom can contribute to
emerged in recent years.
carrying out various governance functions, and
Yet, much remains to be explored, and as the
that outside actors can and often will influence
world around us continues to change, new fron-
and shape the governance function itself. Exam-
tiers open up and new questions surface. This
ples of such actors are managers, operational
article discusses five general areas for future
staff, advisory groups, funders/donors, and gray
inquiry and practical consideration as we con-
eminences, including former executives, the
tinue to develop and refine our understanding of
founder(s) of the agency, and powerful commu-
nonprofit boards and governance.
nity interest groups. It is both possible and often

probable that one or more of these actors par-
1. Broadening the Scope of Governance

beyond the Board of Directors
ticipate in governance of a nonprofit as members
Board work and governance are not synonymous.
dominant (governance) coalition, which may or
of what my colleague David Renz and I call the

may not include members of the board of direc-
F redrik O. A ndersson is a post-doctoral fellow working
tors.2 To date, however, we know very little about
jointly with the Midwest Center for Nonprofit Leadership
the architecture or dynamics of these dominant
in the Henry W. Bloch School of Management at the Uni-
governance coalitions: How are they born and
versity of Missouri-Kansas City, and the George H.W. Bush
how are they organized? How do they lead and
School of Government and Public Service at Texas A&M
how do they evolve over time? To begin answer-
University.
ing these questions we must not only open up the
P H OTO G R A P H : H E AV E N S G AT E
nonprofit governance construct but also focus on
before we can deliver a verdict on the effectiveness
concepts long dormant in nonprofit governance
and outcomes of multilevel governance.
research, including influence, power, politics, and
A key question is how to govern an entity that
elitism. Furthermore, by recognizing that gov-
shares little resemblance to what we typically
ernance is not the exclusive domain of boards,
think of as an organization. Although social move-
we can also better understand the relationships
ments have been around for a long time, the possi-
between various parts of the larger governance
bilities emerging from the use of new information
system, such as regulations, policies, norms, and
technology are making the need for an established
funding regimes, and how they influence gover-
incorporated organizational entity less obvious.
nance structures and practices at the organiza-
But as we move from organization to organiz-
governance process.
tional level. It is worth noting that there is a rich
ing, how do we ensure that important governance
Instead, the governance
literature focusing on the internal (i.e., gover-
responsibilities, such as accountability and over-
nance of organizations) as well as the external
sight, are not marginalized? And who are the key
function is organized in
(i.e., the processes through which society is
governance players in multilevel governance net-
governed) aspects of governance, but they are
works? (In other words, who really governs?) For
an overarching network
seldom discussed or analyzed in tandem.3 Clearly,
instance, traditional agency theory assumes that
finding ways to examine the interactions between
we can differentiate relatively easily between the
these two aspects is a promising and necessary
agent and the principal, but when this relationship
area for future exploration while the social con-
grows more ambiguous, and perhaps even shifts
tract and relationships among the public, private,
depending on when and where one chooses to
and civil sectors are being renegotiated.
look, how can we infer and understand the key
Boards of directors
and organizations
may no longer be the
obvious home of the
of relationships that
crosses and links a broad
set of participating
organizations,
stakeholders, and
nonprofit leaders.
relationships that influence the governance func-
2. The Emergence of Multilevel Governance
tion? We also used to be able to rely on the gov-
Possibly largely due to advancements in technol-
ernment as a sort of coordinating authority that
ogy, we are increasingly witnessing how gover-
could provide some macro-level guidance and set
nance processes are taking place at multiple levels
the rules of the game for nonprofit governance-
both below and above the level of the organization.
related activities, but as responses to major social
Boards of directors and organizations may no longer
problems are increasingly being addressed at the
be the obvious home of the governance process.
international level and include multiple private
Instead, the governance function is organized in an
and public players, there is no single overarching
overarching network of relationships that crosses
authority. Put differently, governments are becom-
and links a broad set of participating organizations,
ing just one among a set of diverse stakeholders.
stakeholders, and nonprofit leaders. Some of these
A final question to consider is what happens
may not even be acknowledged as stakeholders
when a network experiences asymmetric gov-
until the organization violates an expectation they
ernance challenges, such as when one segment
hold or comes under attack. Networks have been
of the network requires a particular governance
widely recognized as a growing and significant
response and another segment requires a differ-
form of multi-organizational governance, and in
ent one. Who gets to decide what to do, how to
theory there are considerable advantages associ-
do it, when to do it, and with what consequences?
ated with network governance and coordination,
As mentioned earlier, to answer such questions
such as enhanced learning, more efficient use of
we must be willing to engage in conversations
scarce resources, and a greater capacity to address
about topics long absent in nonprofit governance
complex social problems. Yet relatively little is
scholarship, including issues of power, politics,
known about how these multilevel governance
and conflict.
structures operate, develop, and change over time.
This discrepancy between the acclamation and
3. Hybridization and Its Consequences
attention networks receive and what we actually
One common observation in both popular and
know suggests that there is much still to be explored
academic literature is that the sector lines that
used to separate government, nonprofit, and busi-
4. Governance and Social Entrepreneurship
ness entities from one another are getting blurrier.
Social entrepreneurship has been described as a
The rise of social enterprises, quasi-governmental
powerful way for nonprofits to generate substan-
organizations, and public-private partnerships
tial social impact and transformational change.
is often highlighted as evidence of increasing
Consequently, nonprofits and their boards are
organizational hybridization and described as
facing mounting expectations to be more socially
a means of addressing complex social issues
entrepreneurial in their posture and operations.
more efficiently and effectively by freeing orga-
Given that propelling an organization in an entre-
nizations from constraints found in the various
preneurial direction involves making critical
sectors. What makes this trend interesting is not
strategic choices, taking strategic action, and
on boards to be more
so much hybridization itselfafter all, one could
leveraging existing resources, it is, at heart, a gov-
make the argument that all organizations are to
ernance matter. Yet there is little research and
entrepreneurial, and
a varying degree hybrid constructs that marry
public discussion linking aspects of governance to
how is this impacting the
various social and economical logicsbut the
social entrepreneurship. Instead, we are evidently
consequences of hybridization on governance.
much more interested in telling hero stories, or
practice of governance?
Put differently, if all organizations are hybrids,
describing success and making such normative
what exactly are they a mix of, and what are the
statements as nonprofits ought to be more entre-
consequences of this mix for key organizational
preneurial. But without a clear understanding of
functions and processes?
the overlay of social entrepreneurship and gover-
One noteworthy approach for examining the
nance (and other domains of nonprofit life), we
above questions emphasizes the role of institu-
are destined to find little constructive knowledge
tional logics, a perspective that can be described
to guide research and practice. Hence, there is
as a framework for investigating the multiple
room for important questions to be explored by
interactions among people, organizations, and
scholars and practitioners alike.
institutions in a social system. One of the central
For instance, one common assumption is
ideas of this approach is that different institu-
that any entrepreneurial endeavor entails risk
tional logics are associated with and distinguished
and uncertainty. But boards of nonprofit orga-
by specific and unique organizing principles, prac-
nizations are mandated to behave as prudent
tices, and images that guide and affect individual
stewards of resources and ensure accountability,
and organizational behavior. In other words, an
which often includes minimizing risks. So how
institutional logic conditions and shapes how key
are boards responding to this challenge? What
reasoning takes place and what is considered and
are the implications of the expectation placed
perceived as important, legitimate, and rational
on boards to be more entrepreneurial, and how
by various actors.4 Applying this lens to hybrid
is this impacting the practice of governance? Are
organizations immediately raises the key ques-
boards ultimately the enablers or perhaps even
tion of what happens when one organizational
the preventers of socially entrepreneurial initia-
structure contains multiple and perhaps even
tives in nonprofits? Other interesting questions:
competing institutional logics. For example, how
Is there such a thing as socially entrepreneur-
can social enterprises balance the logics of busi-
ial governance, and, if so, what characterizes
ness enterprise and market competition with the
and what are the key dimensions of such a gov-
logics of social value creation and democratic
ernance mode? Can boards learn to be more
governance, when furthering one of these logics
socially entrepreneurial, or is this something that
may impede progress toward the other? This and
is imprinted at the birth of the organization and
many other questions are especially pertinent
that becomes something path-dependent as the
from a governance perspective, as they force us
organization grows and ages?
to think prudently about central issues such as
Clearly, if we want nonprofits to be more
accountability and strategic choice making in
entrepreneurial, we can gain insight by looking
hybrid organizations.
at boards and the governance domainno matter
What are the

implications of the
expectation placed
if boards are the drivers of entrepreneurial initia-
as they evolve over time. Moreover, behavioral
tives, the preventers, or perhaps even excluded
studies would also be able to take into account
from the entire process altogether.
variations in perceptions, ideas, and influence

among different stakeholders. Taken together, a
We live in complex times,

and, as the universe of
nonprofit organizations
and organizing evolves,
5. New Methods in Studying Boards and

Governance
behavioral emphasis can help open up the black
As already alluded to, we live in complex times,
ernancewhich is needed to answer many of the
and, as the universe of nonprofit organizations
questions discussed in this article.
box of actual board behavior and nonprofit gov-
and organizing evolves, we must not only ask

new questions but also take a critical look at the
Conclusion
we must not only ask
ways we are trying to answer these questions.
A central dimension in the leadership of non-
new questions but also
In other words, are there limitations arising
profit organizations, governance is a fascinating
from the dominant and/or current research
field for researchers and practitioners alike. This
take a critical look at the
approaches and methodologies employed to
short article provides a few areas and questions
study and assess nonprofit boards and gov-
believed to be of importance as we move forward
ways we are trying to
ernance? In a recent article, Chris Cornforth
in our understanding of this topic.
answer these questions.
addresses this question and points to a number

of shortcomings in current research, including
N otes
the reliance on cross-sectional rather than longi
1. See, for example, Chris Cornforth, Nonprofit Gov-
tudinal sources of data, the neglect of process
ernance Research: Limitations of the Focus on Boards
and evolutionary studies, and the deficiency of
and Suggestions for New Directions, Nonprofit and
research using large and representative samples
Voluntary Sector Quarterly 41, no. 6 (December 2012):
of nonprofit organizations ranging from grass-
111635, http://nvs.sagepub.com/content/41/6/1116;
roots agencies to large nonprofit enterprises.5
David O. Renz, Leadership, Governance, and the
This is particularly important, as several schol-
Work of the Board, in The Jossey-Bass Handbook
ars have acknowledged the significance of size
of Nonprofit Leadership and Management, 3rd ed.,
on not just governance but other key nonprofit
ed. Renz (San Francisco: Jossey-Bass, 2010), 12556.
dimensions. Furthermore, despite the growing
2. Renz and Fredrik O. Andersson, Leadership, Power,
interest and relevance of adopting contingency
and Influence: The Impact of the Dominant Coalition
approaches in nonprofit governance research,
on Nonprofit Governance (paper presented at the
this line of research is still sluggish.
annual conference of the Association for Research
Cornforth also highlights that, somewhat sur-
on Nonprofit Organizations and Voluntary Action
prisingly, we still have very limited insight into
[ARNOVA], Toronto, Canada, November 1719, 2011).
what boards and those involved in governance
3. Kari Steen-Johnsen, Philippe Eynaud, and Filip Wijk-
are actually doing. Hence, one important method-
strm, On Civil Society Governance: An Emergent
ological direction to explore is to adopt a behav-
Research Field, Voluntas 22, no. 4 (December 2011):
ioral approach to study processes and dynamics
55565.
in and around the boardroom to better understand
4. Patricia H. Thornton and William Ocasio, Institu-
both what boards are doing and how governance
tional Logics, in The SAGE Handbook of Organiza-
unfolds in nonprofits. A more behaviorally ori-
tional Institutionalism, eds. Royston Greenwood,
ented lens would also lend itself toward the use
Christine Oliver, Kerstin Sahlin, and Roy Suddaby
of first-hand empirical data-collection methods,
(Thousand Oaks, CA: Sage Publications, 2008), 99129.
such as questionnaire surveys, in-depth inter-
5. Cornforth, Nonprofit Governance Research, Non-
views, and participant observations. Ideally, we
profit and Voluntary Sector Quarterly 41, no. 6.
would be able to collect longitudinal data from
multiple respondents and stakeholders in and
around the boardroom to outline and understand
changing configurations and modes of governance
NPQ
thanks the Eugene and Agnes E. Meyer Foundation
for its support of this special edition.
www.meyerfoundation.org
Strengthening Communities Across Greater Washington
Stronger Boards. Bigger Impact.

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Promoting Spirited Nonprofit Management

Guo on the Democratic Deficit

The Midwest Center for

The Midwest Center for Nonprofit Leadership

The Alliance for Nonprofit Management

Advances of Information Technology and Governance

The conference begins on Thursday morning, April 4, 2013, and

Volume 19, Issue 4

32 Adding a Few More Pieces to the

6 Problem Boards or Board Problem?

What is it that enables boards to be strong

meaningful for serving members and more

and effective, and why are we still using

consequential for their organizations?

outdated models in an effort to improve

by William P. Ryan, Richard P. Chait, and

14 Underestimating the Power of

by David O. Renz, PhD

40 Financial Transactions with Your

This article proposes that nonprofit

In a first-of-its-kind study, nonprofits

leaders are increasingly focused on

report on their transactions with board

secondary issues, and asks, What does

memberssome for the better and some

the sector stand to gain as a result of

for the worse.

retraining our focus from structural

by Francie Ostrower, PhD

concerns to the central questions and

46 Sarbanes-Oxley: Ten Years Later

A decade since the Sarbanes-Oxley Act

first appeared, organizations still worry

The most substantive decisions on your

seep into the sector. But doesnt the sector

organizations governance are likely

actually have little to worry about and

happening far from the board room. How

should your governance systems respond?

by David O. Renz, PhD

26 The Road Less Traveled: Establishing

by Chao Guo, PhD

50 The Inclusive Nonprofit Boardroom:

Diversity on boards has to be good,

scrutiny and creativity that will ultimately

right? So how is it that study after study

strengthen its ability to achieve its

suggests the opposite? A closer look at

boards today reveals that exactly how we

by Patricia Bradshaw, PhD, and Peter Jackson, CA

diversify makes all the difference.

by Patricia Bradshaw, PhD, and Christopher

78 Board Stories Involving Humans

58 Unstill Waters: The Fluid Role of

not the model but the people who make it

Its a wonder that social-movement

networks survive long enough to make an

86 The Best and Worst of Board Chairs

Do you know one when you see one?

Initial research shows that there is a great

by Judy Freiwirth, PsyD

deal of agreement about what makes a

by Yvonne D. Harrison and Vic Murray

92 New Frontiers and Critical

Advances of Information Technology and Governance