I just returned from a job interview for the position of CEO of a nonprofit organization. In their strategic plan, they indicated that they were going to hire a full-time fund development manager to handle all development areas, and that this position was going to report directly to the board, not the CEO. I questioned their reasoning for this and they indicated this is the “new fundraising practice”. Can you comment on this? I have never heard of this before and see major difficulties with this arrangement. Have I missed out on a new “best practice” or is this a new management theory for nonprofits?

Here’s something a bit different for the human resources management column. We don’t normally receive questions that have to do with the relationship between a board of directors and the senior staff member, but this gives us an opportunity to scrutinize it a little.

Broadly speaking, it’s the board’s responsibility to oversee the management of the agency. This means providing direction to staff that is in the best interest of the agency’s mission – the reason why it exists. Individual directors may advise staff in areas of their expertise. The staff’s responsibility is to carry out board directives. Staff also advise directors with respect to issues requiring their attention, and may suggest ways and means of addressing such issues. It may occasionally be necessary for staff to ‘save the board from itself’ when well-intentioned directors want to pursue a course of action that may well get the board into trouble.

Boards may be active or quiescent. At the active end of this continuum, directors may involve themselves in operational matters, making their presence felt by recommending specific courses of action that they feel the CEO should be pursuing. At the more passive end, directors may be content to authorize actions that the CEO places before them for their approval. Active or passive, the board’s responsibilities remain the same.

I’ve served on both kinds of boards. The active one was a board of education (granted, this was an elected position). Many trustees believed that they could serve their constituents best by being actively involved in the day to day management of board business. They recommended, usually with some forcefulness, who should be made the principal of a particular school, what the contents of collective agreements should look like, even to the point of allocating budgetary resources to certain schools based on a perception of how deserving some schools were as opposed to others. In other words, they immersed themselves in management decisions without having management accountability.

While no one would suggest that trustees not account to their rate payers as responsibly as possible, you can see, no doubt, the problems that the activist style may cause. The day to day management of an organization requires an accountability structure of which trustees are not a part. Thus, they can involve themselves with impunity in operations while being accountable only to their constituents. And the legitimate role that staff needs to play is often compromised.

The passive board was a funded social agency. The CEO was very experienced in the role. Directors were happy to attend monthly meetings, receive updates on matters that the CEO chose to put before them, approve items that the CEO said needed their approval, and pretty much let it go at that.

The missing piece in this case was the passive role that the chair of the board chose to play. The CEO reported to the board as a whole, of course, but for practical purposes, the chair needed to function as the CEO’s boss. This didn’t happen, with the result that the CEO did whatever she wanted or felt she needed to do. There was no effective oversight of her job. And there was no process through which she could be encouraged to think outside the box or do things outside her comfort zone.

In the particular case that our reader is asking us to comment on, it appears that there is a certain amount of activism on the part of directors. We don’t know the story behind the decision to create a staff position that doesn’t report to the CEO. There may be good and valid reasons for such a move, and as long as the CEO understands and accepts them, the arrangement may be workable.

The alarm bells go off, however, in the face of the answer that purportedly provides the rationale for the move. “It’s the new fundraising practice” is a non-answer. It could mean anything from, “We don’t know” to “None of your business”. It suggests that there’s a good chance the CEO may be undermined in her duty to (sometimes) protect the board from itself.

I’m pretty sure that this isn’t a case of a new best practice. If more information is not forthcoming, this role looks like one to avoid.

To submit a question for a future column, or to comment on a previous one, please contact editor@charityvillage.com. No identifying information will appear in this column. For paid professional advice about an urgent or complex situation, contact Tim directly.

Tim Rutledge, Ph.D., is a veteran human resources consultant and publisher of Mattanie Press. You can contact him at tim_rutledge@sympatico.ca or visit www.gettingengaged.ca.

Disclaimer: Advice and recommendations are based on limited information provided and should be used as a guideline only. Neither the author nor CharityVillage.com make any warranty, express or implied, or assume any legal liability for accuracy, completeness, or usefulness of any information provided in whole or in part within this article.