Governance & Leadership

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Governance & Leadership

Rarely have corporate directors faced such a deep and widespread erosion of public trust. Over the last two decades, corporate governance has attracted a great deal of public interest because of its apparent importance for the economic health of corporations and society in general.

The headlines of the previous several years in particular portrayed a sad story of corporate ethics – falling stock markets, corporate failures, dubious accounting practices, abuses of corporate power, criminal investigations indicate that the entire economic system upon which investment returns have depended is showing signs of stress that have undermined the public’s confidence.

In the face of such scandals and malpractices, there has been a renewed emphasis on corporate governance. Boards are seen to provide weak oversight, or worse, to be complicit in allowing executive greed, rewarding under-performance and failing to prevent corporate excess and even fraud.

Kevin Russ L.L.C. governance and leadership consultants help businesses and organizations and groups assess their board and its membership, identify skills, behaviors, and attributes necessary for “good governance” develop systems, processes, and policies,  evaluate performance, and vet potential members so that you can enhance your reputation with investors and stakeholders.

 

In the most recent Leading with Intent survey, a governance survey conducted by BoardSource, only a slight majority (51%) of organizations reported that they use a formal, written self-assessment to evaluate their board’s effectiveness. We think that more nonprofits would benefit from a self-assessment process. We’re not sure why more boards do not regularly assess their own performance, but perhaps they just don’t feel prepared to do so.

 

While not yet universally applied, board questionnaire certainly is a best practice. Board performance is a key element of any organization’s success. A study shows that boards that conducted a questionnaire within the past three years reported higher performing boards, better board orientation, and greater board engagement. Structured self-reflection provides a unique and essential opportunity for board members to judge their collective performance, understand the extent of their individual responsibilities, and take action to improve board performance.

Any athlete knows the model works. Coaches take stock of players’ abilities and work to improve them on an ongoing basis. Practice, assess, tweak, improve, practice, assess, tweak, improve. Peak performance isn’t left to chance. In any context. Yet only half of nonprofit boards conducted a recent board inventory (within three years) of their members skills, abilities, and competencies. To begin building an effective board of directors and to see where your organization is presently, first take a close look at what its current and potential members bring to the table.

Board surveys are an important part of good corporate governance. Just as a clear statement of responsibilities and a rigorous performance appraisal is important for the CEO and senior management team, it is also important for the board. A board demonstrates leadership by conducting a board effectiveness or performance review and instituting appropriate improvement initiatives.

Boards are ultimately responsible for the long term success of their organizations. This means that strategy cannot be neglected; it must be one of the central elements of the board’s activities. There is a great deal of confusion among boards as to what they should, or shouldn’t, do when it comes to participating in strategy. Very simply put, strategic planning identifies where the organization wants to be at some point in the future and how it is going to get there. Skills in strategic planning are critical to the long-term success of your organization.

It is hard to know what ‘good governance’ is. You recognize it when everything goes smoothly, and you also feel the lack of it when times are rocky. While there is no cookie-cutter approach to good governance, there are lots of recipes for disaster. Good governance like a good recipe requires the right ingredients (the right mix of board members, a chef to provide leadership and accountability, and careful mixing and stirring of candid discussions – but most importantly, transparent practices, and governance policies.

If your organization is like most, you spend more time, money and energy recruiting for clerical and janitorial positions than for the position of board member. When we recruit board members, we forget that we are “hiring” folks to do a job – one of the most critical jobs in the whole organization: leadership and governance. So how can we improve the recruitment process? The first step would be to make sure you actually have a process and plan! Whenever we do board development work, we start by asking the group what they are looking for in a board member. You can’t find the right people to lead your organization if you don’t know what you’re looking for.

A retreat is a great tool when a group has something important to work on together. Strategy development, conflict resolution, working agreements, a new initiative or action planning are all excellent opportunities for retreats. With a clear focus, a retreat can be an opportunity to innovate, see new possibilities and envision the work of an organization in new and refreshed ways. Retreats can also build organizational muscle for strategic and creative thinking that can be carried back into daily work. A retreat can be an opportunity for taking stock, reflecting together, assessing and refining practice, and providing a turbo boost to specific aspects of work. A Board Retreat is the prime opportunity to discuss a matter of importance in-depth and without the normal Board business that gobbles up almost all meetings.

Whether you work for a nonprofit or you’re on the board, you know nonprofits usually have more going on than people to do it. So chances are you haven’t been trained in the appropriate roles of the board. Nonprofit board members are often very passionate about the objectives of the organization, but it takes more than passion to govern a nonprofit organization. Although many of the same concepts in the for-profit world relate to nonprofits, they behave differently. Board members must understand their role within the organization, fundraising tools and management techniques. Training on board member roles can help board members become acclimated to their role.

When the board meeting agenda turns to fundraising, board members may get a little uncomfortable. Why? Because they know that one of these days, if not today, somebody‟s going to ask them to raise some money. And lots of people just hate, fear and freeze up when they‟re asked to do so. An all-too-common scenario in governance and leadership is: the executive director is frustrated because s/he thinks it’s the duty of the board to raise money – but some, if not all, are reluctant. A few board members agree with him/her and they say (or pay for a consultant to tell the board): “Every member must give, get, or get out.” Board members typically have three reactions simultaneously. First, they resent being required to do something we were not informed of when we were invited to join the board. Second, they feel guilty anyway. Third, they doubt they could succeed at raising money, even if we were to try. It’s as if we were invited to a potluck, arrived with lasagna, and then scolded for not having brought a chocolate cake! Ensuring that the organization has a realistic strategy for obtaining money is a critical governance responsibility of the board of directors. The board should participate in fundraising strategy by helping  set goals and objectives for income, making sure that the operations of the organization are being funded adequately and properly.

Boards play a critical role in fundraising. The most successful organizations know that, and have built a powerful partnership between the board, the executive, and the staff. Unfortunately, some boards resist their responsibility to actively engage in fundraising efforts, or simply don’t understand how to be most helpful. Raising funds begins with an understanding of the board’s responsibilities to actively engage and to ensure that the organization has adequate resources to advance its mission. This means that — with the exception of those organizations that don’t rely on contributions to underwrite their important work — boards must be actively engaged in guiding and supporting these efforts. Boards — as a group — should understand and help inform resource development strategies and monitor progress against fund development plans.

Raising money in today’s increasingly competitive environment requires tapping the energy and enthusiasm of every one of your nonprofit board members. For your mission to succeed, you need to roll up your sleeves and be a part of the fundraising process. Destined to become the standard in the field, A Fundraising Guide for Nonprofit Board Members helps you transform yourself from a passive board member into an active member of the fundraising team who is ready and able to tap into all the philanthropic resources available. Most board members want to be successful! They want to be competent and effective. They don’t want to feel inept or look like fools. So how do you think your board members feel when you ask them to help raise money but they don’t know what they are doing? Yup. They probably feel inept or even worse, foolish.  You’re setting them up for failure. No wonder so many of them resist! How can you help your board members succeed? It’s simple. Help your board members learn what they need to know and give them plenty of opportunity to practice. Teaching people to do something well is seldom a one-shot deal. You didn’t learn to swim in one session in the pool. And I’ll bet that you didn’t become an effective fundraiser in a day either. The same is true of your board – they aren’t likely to become comfortable fundraisers, let alone skilled ones, after just one workshop or training session. But don’t worry! Turning your board members into comfortable, effective fundraisers isn’t difficult – you just need a bit of planning.

One of the fundamental challenges that far too many board members and boards have is that they don’t have a strong understanding of their roles and responsibilities. It sounds basic, but one of the fundamental challenges that far too many board members and boards have is that they don’t have a strong understanding of their roles and responsibilities. They struggle most with external responsibilities, including fundraising, advocacy, and community-building and outreach. This lack of understanding of what is — and is not — a part of the board’s essential roles can lead to a whole host of dysfunctions, such as micromanagement, rogue decision-making, lack of engagement, and more. Since it’s impossible to do a job well if you don’t know what the job is, all boards must take the time to ensure that every board member fully understands what’s expected and needed of him or her, and then hold all members accountable when they get off track.

In decades past, boards could rely solely on management to oversee and manage risk. The pervasiveness of risk in the workings of everyday business means that boards must factor risk as an integral part of organizational strategy. Today’s businesses are wrought with complexities and litigiousness like never before—issues that hold the potential to destroy organizations overnight. Boards are increasingly being held accountable for managing risk. Corporate governance rules and agencies are taking a stronger role in corporate risk by forming policies that address risk management policies. These emerging trends are forcing boards to assess past organizational exposures to risks. Economic trends also demand boards to be forward-thinking with regard to overseeing current financial risks and exposures to minimize the impact of financial crises. Poor risk management exposes organizations to civil and statutory offences, which can result in fines or other legal complications. The result of not managing risks can quickly deplete an organization’s reserves.

Having a common governance framework can play an important role in helping boards gain a better understanding of their oversight role. Form follows function, or at least it should when it comes to boards. Without a strong structure, boards can fall prey to a whole host of dysfunctions, not the least of which is wasted time, boring or unfocused meetings, and lack of strategic engagement from the board. There’s no one-size-fits-all approach to board structure, but there are some general principles that each board should keep in mind when thinking about its ideal structure. The framework should have attributes that contribute to effective governance and tools for addressing governance risk. A framework also provides a more cogent construct for evaluating how management’s responsibilities fit with the board’s oversight responsibilities. Structure – both of the board as a whole and of individual board meetings – is an important part of an efficient and successful nonprofit board.

Building an effective board is similar to creating a winning sports team. Recruiting talented players that fit the team and training them to play their best are key ingredients. Board members join an organization for a limited amount of time and pledge their personal, professional, and financial resources to advance the mission of the organization. The success of the whole team depends upon the team players being dependent and interdependent upon each other. That dynamic is strongest when each board member performs at his or her best.

When a board member accepts a new position on a board, it’s rare that the board member knows exactly what to do and how to do it. Active board members will get up to speed quickly on their own, but there’s no question that a strong orientation primes new board members for their duties. Regular training keeps them invested in staying active and fulfilling their roles on the board, in committees, and networking outside of board duties. Orientation and training creates opportunities for new members to get acquainted and begin networking with other board members, management, vendors, and employees. Boards need to have a plan for orientation and a process for training new board members. The plan and process will certainly be customized according to the needs of the organization.

Social sector organizations should not ignore the policy environment in which they operate. Opportunities to move your mission forward through policy change represent an important strategy for impact. And, on the flip side, proposed decisions that could negatively impact your organization’s work and stakeholders can represent a significant threat to your mission. Board members are uniquely positioned to be successful advocates and ambassadors for their missions. As business leaders, community volunteers, philanthropists, and opinion leaders, they have the connections, the confidence, the respect needed to speak up on behalf of their organizations when policy decisions are being made that might affect the organization’s ability to achieve its mission.

Advocacy is a powerful way to leverage the important mission work that your organization does in your community. Board members — as influential community leaders — can help increase the likelihood of your nonprofit’s success by engaging in advocacy. Fundamentally, board members are champions for their missions and have an opportunity to connect their passion for their organization’s work with their influence within the community. Many organizations avoid advocacy out of misplaced myths that it is somehow wrong, which limits the impact and effectiveness of the nonprofit sector. The truth is, as a nonprofit organization, you have quite a bit of flexibility to advocate for (or against) decisions by others that could advance (or hurt) your organization’s mission.

 

While the task of recruiting board members might seem a little daunting, it’s important to take the time to find candidates with the right values, skills, attitude and commitment. After all, even though this is a volunteer job, being a board member is a crucial leadership role! These folks are going to be responsible for the financial and cultural well-being of your organization. They are defending and promoting your mission; acting as key spokespersons and possibly driving fund raising too. For small volunteer-led organizations, the board may be managing the day-to-day operations as well. In going through a structured application and review process, you can take the time to really get to know the potential board members and lay the foundation for building a strong relationship. This is critical, since this new recruit will become a very active member of your immediate board family or team, which will be working together to lead the organization for one or two years. It’s not about “filling seats”. An established recruitment process (that includes a well-defined role and expectations as well as an application and screening process) ensures that all candidates are qualified and evaluated using consistent criteria and process. So it won’t come down to a question of a referral gone wrong, an awkward situation or even worse, the desire to “uninvite” a candidate who turns out to be a bad fit or poses any potential conflicts of interest.

The board, its composition and evaluation of performance is central to corporate governance. Increased scrutiny has recently focused on the activities of the board and its committees particularly post the banking crisis and experience shows that a successful board is not guaranteed by just bringing together successful people. All boards, and their committees, can benefit from evaluations: in particular subsidiary boards are often training grounds for listed company boards and getting into good governance practices at subsidiary level can pay dividends later on. Board evaluations can bring tremendous benefits and a properly conducted evaluation can contribute significantly to performance improvements on three levels: organizational; board and individual member level. One of the main goals of board evaluation is to enable boards to purposefully identify and surmount the barriers that impede their effectiveness. Establishing an effective process for board evaluation can send a positive signal to the organization that board members are committed to doing their best.

transforming potential into extraordinary growth and success

We offer individualized, tailor-made solutions to complex questions and challenges. Our researched-based governance and leadership consulting, advisory and technical assistance strategies and methods promote long-term agency, institution, and organization growth and success. From brainstorming and visioning to board vetting and selection to board training to board assessment and evaluation we are here for you from beginning to end.

Our experts can help you integrate our paradigm of governance and leadership consulting, advisory, technical assistance, and capacity building services into your agency’s, institution’s, or organization’s strategy  through services and solutions that include:

  • Governance and Leadership Assessment – A complete audit and review of your agency’s, institution’s, or organization’s governance and leadership model, strategy, approach and philosophy to identify its unique strengths, areas in need to improvement, and to make recommendations for enhancement so that you can make an informed understanding of the gaps or needs that exist and their impacts.
  • Governance and Leadership Assessment Consultation and Advisory – An on/off-site partnership to hone in on and resolve some of your agency’s, institution’s, or organization’s  governance and leadership issues and challenges and to answer any questions or concerns related to integrating elements of  the KRI governance and leadership paradigm into your programmatic interventions.
  • Professional Development and Training – An on/off-site partnership providing customized governance and leadership training for your agency’s, institution’s, or organization’s program and strategy.
  • Supplementary Support – An on/off-site partnership providing your agency’s, institution’s, or organization’s  program and strategy with cutting-edge additional expertise to help fill critical career Governance and Leadership Assessment gaps and resources.
  • Development of a Governance and Leadership System – A customized governance and leadership system that enables you to train, self-consult, and evaluate your own program in a specialized milieu of solutions or services.

comprehensive, individualized, seamless, and multi-layered services

KRI offers you knowledge, expertise, strategies and skills that you stay on top of a rapidly changing fundraising and development environment. KRI offers a unique combination and blend of consulting, advisory, technical assistance, and training that will provide you with a toolbox and array of tools to help you engage new fundraising an development opportunities regardless of environment:

 

  • 4-year public and private college and university campuses
  • 2-year community and junior college campuses
  • Vocational schools and job training programs
  • Public and private elementary, middle, and high schools
  • Elementary, middle, and high schools
  • Nonprofit organizations
  • Governmental/human service agencies
  • Faith-based and/or religious organizations
  • Corporate diversity and inclusion programs

delivering innovative, systematic solutions, and individualized dramatic results

Kevin Russ L.L.C. expertise spans over 75 -years of researched-based, practiced and proven, outcomes-driven, insight, intelligence, data and thought-leadership resulting in a consulting, advisory, technical assistance, and capacity building solutions that are comprehensive, intensive, systematic, seamless, and customized.

Kevin Russ L.L.C. clients have included agencies, corporations, institutions, and organizations that are experiencing challenges and issues with creating growth and sustainability. KRI has and continues to provide cutting-edge solutions and services to small, medium, and large-sized businesses across multiple sectors.

Kevin Russ L.L.C. works with innovative, forward thinking, and change agent individuals, agencies, corporations, institutions, and organizations to create cutting-edge insights and thought-leadership for governance and leadership to provide better opportunities for agencies, corporations, institutions, and organizations to transform potential into success.

creating an environment for growth and excellence

A strong business plan requires going beyond intuition and experience, and supporting your idea with fact-based market research. Investors need to have confidence in your understanding of the market, so don’t let yourself down by skimping on research. We have access to fee-based, subscriber-only resources such as:

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To obtain detailed information about specific Kevin Russ L.L.C. governance and leadership services please complete the online needs assessment inquiry below. Or contact us at the Kevin Russ L.L.C. office nearest to you.

“Kevin Russ L.L.C., really brought a fresh, sharp, deep approach to this board governance project. You came at this with knowledge, insight, and wisdom and a penchant for risk taking and challenging the UCC Board. We still have a lot of work to do, but you helped us see what is possible and how it should really be done. We have a great foundation for management governance now!”

Craig Mainor
Chief Executive Officer, Community's United Corporation

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