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QUESTION 1: Is Our Board Composition Right?

By John Pearson

“A Board Full of Generalists
Is Not Good Enough Anymore”


This week while we’re still enduring the COVID-19 marathon, I’m launching a series of 14 pesky boardroom questions—over the next 14 blogs. I’m leaning on the savvy wisdom of Ram Charan’s helpful governance book, Owning Up. (Click here to read my review.) The first chapter (just 18 pages) is jam-packed with boardroom insights. He writes:

“The role of the board has unmistakably transitioned from passive governance to active leadership with a delicate balance of avoiding micromanaging. It’s leadership as a group, not leadership by an appointed person.” He adds, “With the right composition, a board can create value; with the wrong or inappropriate composition, it can easily destroy value.”

QUESTION 1 of 14: Is Our Board Composition Right?
Owning Up: The 14 Questions Every Board Member Needs to Ask (Order from Amazon)

Here are three takeaways:

Plan for Board Succession. Address “the anticipated requirements of the board composition over five to ten years. Staggering the ages of directors on a board is important—that’s why a ten-year view is needed.”

Recruit for Expertise (but don’t recruit micro-managers). Charan recommends using a skill assessment matrix “…because a board full of generalists is not good enough anymore.”

Conduct Deep Reference Checks. “Standard reference checking is not enough. Governance committees must make the commitment to vigorously check a candidate’s references by talking to other people in the board’s own social and professional networks.”

The author asks board members to annually conduct their own reality check: “Are You Staying on Your Board for the Right Reasons?” Chapter 1 also notes the biggest red flag to avoid—a board nominee with a big ego.

So is your Christ-centered board appropriately addressing these board composition issues? Urge your Governance Committee, or Executive Committee, to read this chapter and ask these questions:

1. Do we have a plan for board succession? Is there a spiritual discernment component to our board member recruitment process?
2. Is our board composition wide enough and diverse enough to address our needs five years from now? Is boardroom group-think common or uncommon? Do we hear from God about our board prospects—or just the loudest-talking board member or the largest donor?
3. Do we consistently go deep when checking references—including a board prospect’s pastor, small group leader, and/or other influential people in his or her life?

It’s been said that “there are no dysfunctional organizations—only dysfunctional boards.” Thus, creating and leveraging the right board composition is critical. God-honoring boards will give high priority to board succession best practices.

BOARD DISCUSSION: What ONE next step is the most critical for our board—this quarter?

MORE RESOURCES: Check out these helpful ECFA resources:
VIDEO: ECFA Governance Toolbox Series No. 1 - Recruiting Board Members: Leveraging the 4 Phases of Board Recruitment: Cultivation, Recruitment, Orientation, and Engagement (online video, viewing guide, and facilitator guide)
BLOG: “If You Need a Board Member, Recruit a Board Member,” by Bruce Johnson, in the 40-week series, Lessons From the Nonprofit Boardroom Blog
TOOL: “The Pathway to the Board: Six Steps on the Pathway to Board Service,” from the book, ECFA Tools and Templates for Effective Board Governance: Time-Saving Solutions for Your Board

 

This article was originally posted on the “Governance of Christ-Centered Organizations” blog, hosted by ECFA.
John Pearson, a board governance consultant and author, was ECFA’s governance blogger from 2011 to 2020.
© 2021, ECFA and John Pearson. All rights reserved.

 


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.

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