The shocking truth about nonprofit board governance best practices (and how they impact raising major gifts) is that many nonprofit board governance best practices are often ignored by nonprofit professionals and volunteers — including perhaps the most important best practice for any nonprofit board.
So that begs the question: Why?
- Are best practices simply unknown by key leaders?
- Are best practices too hard to implement?
- Are best practices counterintuitive (people don’t believe they work)?
The reality is, best practices are just that — best practices — for a reason… they work. So why are so many nonprofit professionals and volunteers flat-out ignoring them?
The Nonprofit Board Governance Best Practice that’s Most Ignored
There are lots of nonprofit board governance best practices that are ignored, but the one I want to focus on today is term limits.
Term limits for board members caught my attention because I was speaking with a client this week about a board retreat I’ll be facilitating. Their bylaws include term limits, but they don’t enforce them.
There are a variety of reasons term limits are not enforced. The big one is because organizations don’t want to lose their best and brightest board members. But how many boards are filled with shining stars? What about those board members who have been there forever and are just warming seats — or worse, don’t even participate or show up?
What if your board is stuck in a rut? Those organizations also don’t enforce term limits. (I know because I work with them.)
Term Limits for Board Members — A Critical Best Practice
So what are ideal term limits and how should they be enforced?
I generally recommend up to three, three-year terms. In other words, each term is three years, and a board member can serve up to three terms (nine years total) in succession. Many organizations also have one and two year terms.
After a full set of terms are served, there should be a one year break. After that, if the board member wants to return (and the organization wants them back) then the board member can start over (another potential nine years).
The reason for the break is that it gives the board an opportunity to operate without that person and forces other members to step up into leadership positions.
Terms for each board member should be tracked by staff (or the board secretary) and reviewed annually by the nominating committee, so they know who’s up for renewal and who is rotating off.
A Term Limit example from the real world:
I recently served on the board of the Association of Fundraising Professionals – New Jersey Chapter. They have chapters all over the world, and about half of the chapters have one year terms and the other half have two year terms.
At the annual leadership conference, chapter presidents (myself included) discussed the pros and con of one and two year terms in leadership positions — one year seemed too short and two years felt a bit long. There’s no perfect answer. You need to do what works for your organization.
Dangers of NOT Implementing and Enforcing Term Limits
Most organization’s governance bylaws include term limits for board members. However, many organizations don’t enforce them. They are likely afraid they can’t fill empty board member slots.
However, if there’s no sense of urgency to fill slots, then the nominating committee’s role becomes unimportant and there’s really no reason to do their job.
So what’s the harm in ignoring a nonprofit board governance best practice like term limits? No new board members on a regular and ongoing basis results in:
- No new ideas
- No new connections / relationships
- No new skill sets
What’s all that got to do with raising major gifts?
A key component of a high functioning board is that board members help raise money. Often, a lot of money.
If you have the same old, same old in terms of who’s on your board, what they do, and who they know, news flash — you’re not going to raise more money. And that’s one major reason why term limits are one of the most important nonprofit board governance best practices you and your organization can (and should) follow.
It’s time for a little honesty (but no judgment)… what board governance best practices does your organization ignore and why? Tell me about it in the comments.
Thanks for this, Amy! When I talk with Boards about term limits, I always ask them to think about their own personal lives six years ago (I always recommend six years, max). How different is it from the life you are living now? (Probably quite different). Things can change a lot for a person in six years, and that goes for organizations as well. Your non-profit is more than likely dealing with very different issues and environments than it was six years ago, and needs new perspectives and leadership skills. .
Hi Amy,
What about board members rotating roles within the board after their term is up? Should this be allowed? What do you think the pros/cons are?
Hi Marsha – pros are keeping those with experience. Cons are sacrificing new ideas and energy.
Hi Amy,
What about rotating the board member whose term is up to serve on an Advisory Council. Many Advisory Council members attend board meetings several times a year. As an Advisory Council member they do not vote. Does this have pros and cons on the vitality of the board?
Perhaps the most shocking truth – and hopefully rare – is the purposeful creation of a board that will rubber stamp leadership decisions, even unethical ones. This will be evidenced by an org that has had the same board members for many years without Best Practice term limits. Because it is the board’s decision to review and terminate an ED, there exists strong motivation for an ED to craft a board that is made up of strategic allies that will never rock the boat. This is indicative of a very toxic organization. Sadly, there is no “policing” of nonprofits so this malpractice is usually only exposed to the public after it it too late, after many people have been harmed, and the mission compromised.
Oh boy does that ring true .I have been introduced to a nonprofit that has no time limit on terms they infact have manipulated the whole voting system turn out from why or who runs and if a person is on the board but never takes part in a thing and never gives a minute of time but yet will show up to have the vote count on what ever the one needs to get done.there is so much bad habits and violations taking place here .misrepresentation of funds and much more.gosh do these poor shareholders need help.
So what are your thoughts on different term durations for elected vs. appointed board members? In a recent meeting, it was suggested that those appointed are only allowed 2 year terms while elected members were allowed the full 3 years. I am appalled at this idea, but would love more insight and guidance! Thank you so much!
I have a situation where board members are assigned by each member organization utilizing the facility. One person, who is a member of several of the member organizations,, keeps getting themselves assigned to the board. Thus, they have been on the board and a disruptive force for many years.. How can the term limit clause be set so that it applies to a specific individual?
Does a President who has already served 4 years as mandated by current bylaws get to automatically extend their term to another 2 years because bylaws were amended?