Perfect board governance is a concept that is difficult to define. Yet it’s something boards must strive for – and one they can achieve if understand what good governance is when they are built according in accordance with a strict blueprint (what Nadler calls “board building”) and exhibit appropriate behaviors.
To achieve this, boards must be well-organized, selected and geared toward the future. They must be able keep in balance the requirements of the organization and the needs of its stakeholders and shareholders. They should be able to deal with new regulatory pressures as they arise.
In the end, the success of a non-profit organization is contingent on its board’s ability overcome these challenges and ensure it is set up for a sustainable future. A well-functioning board can help its trustees to fulfill their responsibilities and help the community by ensuring that an organization’s programs are healthy or on track for accreditation.
The most important structural element is the creation of a suitable agenda and schedule for the board. It should be simple for directors to identify which matters need their attention and the ones that can be delegated. It should also define what the board is required to be consulted or informed about matters that don’t require a decision by the board in its entirety.
Additionally, boards need to be able to identify their own weaknesses and areas of improvement. A review every year is helpful because it lets the board compare its performance with that of its peers.
