How to Build a Better Nonprofit Board of Directors Today—Plus Board Responsibilities, Structure, and Recruiting Tips

September 1, 2023
10 minutes

We know that your nonprofit board of directors is amazing and that you appreciate them so, so much. But sometimes, making the most of their time can be … challenging. In fact, it's happening right now, isn't it? You're gritting your teeth in frustration over something that fell between the cracks. And hey, we know your board wants to be helpful, they yearn to make a difference, they're itching to Get Things Done. But we also know that your board can do better and be better. So, let's put our heads together and figure out how to create your best board yet.

First, we'll drill down into all that must-know board information for your nonprofit organization, from board members' roles and responsibilities to board committees. Then, it's on to our tips and tricks to ensure that your board is the best version of themselves! We'll talk shop when it comes to recruiting potential board members and making the most of your board's limited time.

  1. Why Are Nonprofit Boards Important?
  2. Responsibilities of a Nonprofit BOD
  3. Legal Duties of Nonprofit Boards
  4. Types of Nonprofit Boards
  5. How to Find Board Members
  6. What to Consider When Building Your Board
  7. Essential Board Committees
  8. Taking Your Board from Good to Great
  9. Improvements Your Board Can Make Today
  10. Nonprofit Board of Directors: FAQs

By the end of this guide, everyone will be on board with your plan. (We had to say it.)

Why Are Nonprofit Boards Important?

From time to time, and especially when it's Thursday at 5:00 pm and the board meeting doesn't start until 7:00, you might find yourself thinking, "Do we really need a board of directors at all?" The answer, tired nonprofiteer, is a resounding yes. A nonprofit board of directors plays a critical role in taking on various responsibilities and overseeing key functions. They provide governance and oversight, ensure financial accountability, support fundraising efforts, and guide your nonprofit's long-term strategy.

TL;DR, your board ensures an efficient, effective, and sustainable organization.

Want to drill down further? Let's review a nonprofit board of directors' key responsibilities.

Basic Responsibilities of a Nonprofit Board of Directors

We're all in agreement that having a strong board is vital to nonprofit success. But to make the most of your mighty team, you first need to iron out all those nitty-gritty legal details and clearly define the responsibilities of board members. Here's your basic board to-do list.

Determining the organization's mission and purpose

It's your nonprofit organization's responsibility to make sure everyone involved understands and agrees with why you exist in the first place. The board is responsible for steering this process through creating a mission statement.

Selecting the chief executive, managing director, or executive director

The chief executive is the public face of your nonprofit organization, so you want the best of the best. This is a senior, vital role, and hiring and onboarding this person is a key nonprofit board responsibility. The board of directors must determine the qualities of a good executive director, then take the lead in setting compensation. After that, they'll need to assess the executive's performance regularly.

Conducting the organizational planning process

The board of directors oversees organizational planning, keeping the nonprofit on track in terms of strategy, finance, and mission. Since this is a complex and ever-changing process, they typically help create a document called an organizational planning strategic plan. Said plan is regularly submitted and changed as needed.

Determining program lifecycles

Another board member responsibility is determining whether current and proposed programs are in line with the organization's mission, purpose, and vision. There may be competing priorities, and the board of directors will need to decide each particular program's ultimate fate. (Yep, it's a lot of responsibility!) 

Providing financial oversight

It's a nonprofit, and that makes financial management all the more important. Board members play a vital role in ensuring a nonprofit's finances are in order and on track. Their financial responsibilities include reviewing financial statements, ensuring an accurate and realistic budget, and putting appropriate financial policies in place.

Self-reflecting and self-assessing

The board has significant fiduciary responsibilities, so a successful board needs to be their own court-of-appeal to self-regulate. An effective board holds itself to high ethical standards and is laser-focused on the nonprofit organization's success. Additionally,  they should regularly evaluate their performance to ensure a strong board. 

Improving the organization's public image

Your board members don't just sit behind closed doors once a month; they're responsible for getting out there and being ambassadors for your success. They recruit potential board members, bring in new donors and volunteers, and generally sing your praises from coast to coast.

Being accountable

Like many organizations, nonprofits are accountable to their various stakeholders. You know how it works: you get to be a tax-exempt organization, so you need to be trustworthy and transparent. That means your BOD's roles and responsibilities include ethical and legal responsibilities based on providing proper oversight and setting realistic plans.

Expecting the unexpected

In addition to the primary responsibilities above, board members should all be aware that they may be asked to take on a wide range of additional duties and special assignments. Whether it's fundraising, serving as a social media ambassador, or planning for succession, there are always new (and exciting!) bumps in the board journey.

Those are the basic responsibilities of all BODs, but there are also three legal obligations. All together now, let's roll through these fiduciary duties (and apologies in advance for the Legalese).

Duty of Care

To provide discretion in all manners of spending. Boards must ensure the smart use of all assets and that goodwill is used toward the facility and the people involved with the mission.

Duty of Loyalty

Each and every transaction made in the nonprofit must be accountable and only completed in furtherance of the organization's mandate and mission. This includes the recognition and disclosure of any and all conflicts of interest as either a nonprofit or as an individual member of the nonprofit organization. All decision-making must be done with the sole best interest of the charity in mind. No one member supersedes the needs of the organization.

Duty of Obedience

All laws must be obeyed. All regulations governing charitable status must be adhered to. Internal by-laws will be created to support the bigger-picture nature of legal obligations.

Types of Nonprofit Boards

Board members are busy people no matter how you slice it, but different nonprofit boards function in different ways and with different areas of focus. To ensure you have a BOD that works for you, here are the different types of boards.

Advisory board

Advisory boards provide (wait for it) advice and insights to nonprofit organizations. The individual board members have different areas of expertise related to the nonprofit's mission and needs, so they step in as needed to help the organization make informed decisions. 

Cooperative board

With a cooperative board, it's all about shared decision-making as members work together to provide guidance. While most boards have all different board member roles, a cooperative board emphasizes inclusivity over hierarchy and seeks input from different perspectives. The outcome? Decisions that reflect the broader community.

Patron board

This type of board is also known as a fancy board. (Nope, it's not, don't listen to us.) But it is a board made of influential individuals who support the organization through their reputation, network, and, usually, financial resources. They play a role in raising the organization's public standing, attracting resources, and expanding the nonprofit's network.

Policy board

Policy boards are focused on (you guessed it!) setting policies. They focus on making key decisions and providing oversight, ensuring that the organization's activities align with its mission and values. Policy boards leave the operational details to the nonprofit management team while handling governance issues themselves.

Management board

Finally, there are management boards, which play a crucial role in the daily activities of the organization. These board members often take on executive roles and participate in hands-on management. Management boards are more common in smaller nonprofits.

How to Find Board Members for a Nonprofit

So, you're waist-deep in board knowledge and ready to build out an amazing, talented, world-changing board of directors! But how do you find board members? It's time to put on your recruiter hat. (And if you don't have a recruiter hat, just put on some comfy sweats for now.)

How to Recruit a Nonprofit Board

First things first: you need to recruit new board members. 

Define your desired qualities and skills

Whether you have a set list of board member positions or you're going with a cooperative board, you want to cover your bases by listing out all the must-have and nice-to-have skills from your board candidates. Decide what you want them to bring to the table in terms of expertise, experience, and personal qualities that align with your organization's mission.

Start with your connections

Begin your recruitment efforts by tapping into your personal and professional connections to fill those vacant nonprofit board positions. Then, check in with your donors and volunteers (and your existing board members if you have them). Leveraging these connections can help you find potential board members who are genuinely interested in contributing to your cause.

Expand your reach

Once you've exhausted your existing network, it's time to broaden your search, and that might mean getting a little creative. Consider hosting events, tabling at popular local businesses, or attending networking sessions. Additionally, take advantage of online platforms, social media, and industry-specific forums to cast a wider net and attract folks from diverse backgrounds.

What to Consider When Building Your Board

Before you can start reaching out to everyone, everywhere, offering them a plum board position, you need to think about the board itself. There's a lot to consider and a lot of boxes to check, but it'll all be worth it when you have a super awesome BOD. 

Number of board members

Do you want an itty-bitty board or a larger board? Generally, larger, more complex organizations have larger boards, but the choice is yours. Large means adequate resources and varied expertise, but it also means more opinions to manage and more schedules to wrangle. Smaller means focused attention and easier communication, but it also means fewer perspectives and more responsibility for each person. 

Term length

What do we want? Boards of directors that are committed! How do we help them understand their commitment? By being clear about term length! Before you reach out to your prospective board members, they need to know what they're signing up for. Clearly define how long their term on the board will last, whether it's a fixed number of years or based on specific milestones. 

Staggered terms

Just as a nonprofit considers organizational structure to ensure efficiency and effectiveness, you need to decide how to structure your board. One key question to consider: Do you want to implement staggered terms? Staggered terms mean that not all members' terms expire at the same time. It can provide continuity, preventing an entire board turnover and ensuring a mix of experienced and new members.

Board skill set

You already have a list of your desired skills and traits. Now, it's time to consider specific areas of knowledge, such as finance, marketing, legal, or fundraising, that are crucial to your nonprofit's success. For a well-rounded board, make sure you have someone for every skill. Additionally, if you intend to have certain roles on your board, like treasurer and secretary, make sure you're creating a tailored list for those board of directors positions. 

Board meetings

Next, you need to determine the frequency and format of board meetings as well as committee meetings. Regular meetings are vital for decision-making and progress assessment, and you'll likely want to plan an annual meeting or retreat that all members need to attend. Additionally, decide whether meetings will be in-person, virtual, or a combination of both.

Achieving greater representation

A board of directors should reflect the community it serves, so think about diversity and representation on your board. Aim to have a board with varied backgrounds and perspectives; it will enhance decision-making and broaden your network.

Measuring success

We live in a data-driven world, and your board will need to prove its success, too. Define how you'll measure board success by establishing key performance indicators (KPIs) and tracking them over time. (Pssst, if you have a data scientist on your board, this is something they can help with, too!)

Board training

You can't expect new folks to step right into those shiny new board member positions and hit it out of the park from day one. Nope, you'll need to provide some pro guidance in the form of training. Start planning a basic orientation and training program for new board members to help them understand their primary duties and the organization's operations. Then, consider board development opportunities going forward.

Conflicts of interest

Before you ask anyone to join your board, you want to ensure there's zip, zero, zilch conflicts of interest. And just in case one does arise, develop a clear policy to ensure all members act in the best interest of the organization and disclose any potential conflicts that could compromise objective decision-making.

Straying from the organization's mission

Your board of directors should always be driven by your organization's mission. So, how will you keep them aligned and on track? Make sure anyone you're recruiting is there for the right reasons--most importantly, making the world a better place. 

Building a culture of trust and transparency

Boards handle confidential information and make big decisions, so you want a leadership team you can trust. Foster an environment of transparency and open communication among board members and ensure everyone is aligned when it comes to sharing information and working collaboratively.

Staff buy-in

From the executive team to the summer interns, your staff should be on board with your board. Involve them in the board-building process, including interviewing prospective board members and flagging must-have skills and experiences. 

Essential Committees Every Nonprofit BOD Should Have

Board responsibilities don't end with attending monthly meetings. Most often, a board member will sit on at least one committee. And there are lots of benefits to breaking up your board into committees. Committees will allow you to push-pull your board of directors into being efficient, productive, and even a little radical. The three committees your nonprofit definitely wants? Finance, Fundraising, and Recruitment committees make it happen!

It's not as far-fetched of an idea as you might think, really. Kind of like that lady in the 80's commercial who makes the Rice Krispie treats—you remember how she fooled her family into thinking she spent hours on those gooey, crispy goodies, don't you?

So let's just get it done, already! Without further ado, here are the committees you need and how to use them to make your kickass board super-effective.

Finance committee

The expectation for this committee is that they'll advise on the creation of your annual budget, carefully consider large expenses, review financial reports, and look out for the financial future of your organization. It's a big job, but by helping you shoulder this load, your nonprofit's financial stability will be strengthened immeasurably.

But do they need to paw around in your organization's day-to-day budget? No. You and your staff have that covered.

Today, block out a half hour to pull up your budget and mark items that your finance committee can monitor, items that your staff should have control over, and items that need research or votes to move forward. Then lay it out. Your staff should be able to focus on ground-level expenses while your board tracks the make-or-break stuff.

Pro-tip: don't just throw anyone with a businessy-sounding job title on your finance committee. Even if Gretchen is an accountant by day, she may not want to do more number-crunching for your nonprofit; it's possible her real passion lies in networking and fundraising. Let your board members guide you in making committee placements.

Fundraising committee

Here's your big takeaway for this committee: These people should be your org introducers and evangelists so you can run the show. The fundraising committee's essential role is to encourage giving by sharing your mission with the world.

That's it. They shouldn't be planning the events or picking the napkins; this committee should be helping you meet your fundraising goals by getting donors to show up, buy tables, and enjoy your fundraising events. And giving money while they're at it. 

Email your fundraising committee today with specific asks related to upcoming events, holidays, and networking opportunities. Tell them who on your team is handling the detail work of securing venues, writing and sending marketing emails, and choosing napkins—this is not their job, no matter how much they like decorating. Your board members have bigger fish to fry, so don't shy away from giving them concrete, high-level goals and holding them accountable.

Recruitment committee

This committee's purpose is all in the name: recruitment. Their task is to identify, engage, and onboard qualified candidates who will be good stewards of your nonprofit's mission to the outside world. As they do their job, they should definitely be keeping a few key things in mind: the diversity of your board, the required duties of a board member, and the type of person the board wants to have representing the nonprofit.

One thing you can do right now to increase the effectiveness of your recruitment committee is to provide them with a clear idea of the ideal board member—in the marketing world, this is called a persona—because knowing who you're looking for makes recruitment a heckuva lot easier.

If you’re looking for that overachiever A+, here are two other committees you may want to consider:

Governance committee

This committee ensures that the nonprofit is adhering to standards laid out by the org's mission. It's their job to speak up when it's time to fire a board member, when your org's mission and vision aren't being adhered to, and when your nonprofit may be running afoul of legal requirements. The nonprofit governance committee also nominates members for board roles and evaluates overall board effectiveness.

Diversity and inclusion committee

This committee helps you respond to the needs of a wide variety of constituents. These are the people who should be researching how your work impacts marginalized populations and figuring out ways to meet those people where they're at. Take a peek at Vu Le's blog nonprofitaf.com for more information on how to bring diversity to your organization through inclusive behavior.

Taking Your Board from Good to Great

With a board of directors that's trained, mission-driven, diverse, trustworthy, and totally great on paper, you're almost ready to sit back and let the strategic planning flow. But not so fast! After a few months, you'll probably find yourself wondering what else is out there. After all, every nonprofit board has its strengths and weaknesses. So, once you've got a board in place, you're still going to need to do the work to make them the best board they can be. And we've got some great resources to help you out. First, here are six things you can do rightthisminute to bring your board to a higher plane of productivity.​​

​Cancel the meeting

Even if you don't actually cancel the meeting. Just wipe the slate clean; cancel the old meeting in your head and start with a new meeting style. This time, make it worth your time. Time is money, money is power, power is pizza, and pizza is knowledge.

Meme of Aubry Plaza as April on Parks and Rec saying, "Time is money, money is power, power is pizza, and pizza is knowledge."

 

Get Funraise

There are lots of tools out there to make your job easier. We truly believe that Funraise is the best, most efficient, most cost-effective, user-friendly all-in-one fundraising platform in the galaxy. And yeah, our platform will help you see those goals and raise the stakes.

Break it up

Did you read the previous section? No? TL;DR: Get yo'self some committees! Erin Chidsey, nonprofit board whisperer and Funraise friend, recommends that every board have these three committees: Recruitment, Fundraising, and Finance. Break up the work and get it done faster. (We're partial to the Party Planning Committee, ourselves.)

Make it up

It's time you set some ground rules for your board members. If you don't have a plainly-written board member job description that your board members can refer to, draw one up now. No joke, this could be a game-changer for members of your board that are floundering without clear-cut direction.

Shake it up

Consider shedding some dead weight. Yes, we mean letting board members go. You may find that it's not necessary, but you won't know until you take a hard look at what your members are doing for your organization. If they're not bringing value to the table, ask yourself this tough question: "Why are they on the board?" 

Expand the board

Your organization deserves an army of dedicated, engaged board members. Remember that time like a minute ago when you wrote a board member job description? Send that bad boy to your new recruitment committee and get them enlisting the best supporters around.

Bonus tip! Get Funraise

Yeah, it's that good. Right now, you think of Funraise as a way to treat yo'self, but once you use it, it'll become an everyday necessity, just like elbow bedazzling.

Small-yet-Effective Improvements Nonprofits Can Make Today: A List to Share with Your Board

After you’ve moved toward a better nonprofit board, it’s time to delegate responsibility to board members. They play an important role in your nonprofit, so why not challenge them? By working with your board members to focus on planning, training, and commitment, everyone can get on track.

Commit to showing up and being prepared

Real talk for a sec. How is your board’s attendance rate, historically? Do they show up to the majority of meetings? And when they do show up, are they prepared? This might seem like a basic commitment, but showing up and being prepared is important for board members. Give your board members a goal, like showing up to 9 out of 10 meetings. Or! Gamify this goal to encourage accountability and make it really fun.

Also, encourage them to be prepared when they arrive at board meetings. This includes reading board reports, financial reports, and annual reports prior to the meeting, as well as any other documents you may send out ahead of time. Be sure to circulate this information a few days prior to the meeting so that they have time to review it. Honestly, showing up and being ready to do the dang thing is such a reasonable ask... They can make it a reality!

Get the training and support you need to succeed

How many of your board members have prior board experience? Have they had some training or education in the roles and responsibilities of a nonprofit board? Having board development opportunities or training can be super helpful for your board members. Not only will it help them better understand their duty as a board member, but it can also encourage them to be more engaged. When you make your budget, consider setting aside some professional development money specifically for board members. If purse strings are feeling a little tight, seek out some less expensive or free resources like books, webinars, and even online articles. A team that learns together succeeds together!

Think of it like this: when your board has their act together, it means you and your team can focus on your jobs, not running interference or untangling sticky board situations.

Take more action and follow through

Chances are your board isn't showing up just to vote on and approve items on the agenda. It's reasonable to request them to do some work, be it fundraising, research, or attending community events. Set a resolution to encourage more action and make sure you follow through with it. At the end of board meetings, make sure the entire board is clear on next steps and action items. Double down by having your board chair or secretary send out a reminder email after the meeting, so no one can claim that they didn't know.

Check your directors' insurance

Nonprofit boards are liable for more than they may realize. That’s why it’s important to have directors' insurance. This protects board members in the event of a lawsuit or legal issue. Make sure your board members know what their liabilities are and what the directors' insurance covers. If you don’t have directors' insurance, make it a top priority to get a policy ASAP.

Create a succession plan

You may wish that some of your board members will stay on your board forever, but that’s not likely to happen. Board members tend to cycle off at the end of their terms, and in some cases, sooner. Your board needs to have a succession plan in place for recruiting, hiring, and onboarding new board members. This could be a committee task or you could make it a board-wide initiative.

Succession planning is crucial for all board members, especially your board chair role. Be clear about who the next board chair will be and what you and your current board chair are doing to prepare the person in the wings. This is a big role to take on, and it comes with a learning curve. With some forward planning and training, you can make sure your next board chair is prepared and ready for the challenge.

Support the wellbeing of the executive director and staff

Nonprofit work is hard work! Since board members aren’t in the trenches in quite the same way as full-time staff, they may not see the full picture. Board members should encourage the Executive Director and staff to work reasonable hours, take their vacation days, and practice self-care. Supporting the ED and staff will encourage more positive, stronger relationships between everyone and a better working environment in the office.

Boards can also support the ED and staff by not micromanaging and respecting the chain of command. Day-to-day management is not the responsibility of board members. Establishing and respecting boundaries around board duties will keep everyone happier in the long run, trust us.

Make a personal gift to show your support

Board participation in philanthropy isn’t just good for your nonprofit’s fundraising bottom line, it’s a great way for board members to demonstrate their commitment to the cause. It doesn’t have to be a 4-, 5- or 6-figure gift; personal donations of your time, treasure, or talent from each and every board member can demonstrate that the board collectively supports the organization in all the ways that matter most.

Nonprofit boards play an important role in the governance and leadership of an organization. Encouraging your board to be better, not just do better, is one of the ways you can support their leadership. They don’t have to commit to a complete personality overhaul to effect positive change—even setting one or two goals can make a big difference. Onward toward success!

So there you have it: your A-Z to-do list for a high-performing board, ready to dig in and get things done–and, most importantly, make your life easier.

Nonprofit Board of Directors: FAQs

What is a nonprofit board of directors?

A board is the governing body of a nonprofit. They oversee a nonprofit organization’s activities.

What are the board’s main responsibilities?

In addition to the basics, like attending regular meetings and hiring an ED, the board’s main responsibilities are to drive social impact by supporting the nonprofit financially and strategically through advocacy and communication. They also handle hiring a chief executive for the organization if needed.

What are the main roles of the board?

Typically, board member positions include a president/board chair, vice president/vice chair, board secretary, and board treasurer. If you have committees (and we hope you do), each committee also has a committee chair.

How many members should you have on your board?

It totally depends! Each state has a minimum number though. You can have three or you can have 40, but we’d recommend something in the middle.

What is the difference between board chair and executive director?

The board chair, also known as the board president, is a member of the board of directors. The executive director, also known as the CEO, is a member of the nonprofit staff. The board chair's main responsibility is to lead board meetings, but the executive director manages the day-to-day operations, oversees staff, and brings the organization's vision to life. So, while the board chair sets the overall direction, the executive director brings it to fruition.

Who chooses the board of directors for nonprofits?

Usually, the board of directors is selected by the nonprofit's founders (if they're around), existing board members, and, sometimes, other staff members and/or stakeholders. The process varies from organization to organization.

Can the founder of a nonprofit be on the board of directors?

Yes indeed, the founder of a nonprofit can certainly be a member of the board of directors. In fact, founders often bring valuable insights and commitment.

Can family members be on the nonprofit board of directors?

Yes, family members can serve on the board of directors, but it makes those pesky conflicts of interest more likely to arise. Transparency and clear policies regarding conflicts are extra important in these cases.

Mobile phone with donation form and donation charts floating around the phone.Mobile phone with donation form and donation charts floating around the phone.Woman looking at fundraising chart with button to book a call.Yellow shapes in background with donation form in front with stylized text, build an intelligence giving experience.Sparkling star.
Download
Sparkling star.
Start For Free
Sparkling star.Sparkling stars.
Blue shapes.Blue shapes.Blue shapes.