Structure of a Non-Profit Board of Directors
A non-profit organization is set up to provide several types of assistance and services, rather than accumulate revenue like a for profit business. A non-profit may be a religious, educational, charitable or philanthropic organization. Building a solid, working board of directors is the cornerstone to the success of any non-profit entity. Board members of a non-profit organization are prohibited from benefitting financially from board membership, and volunteer their time and services to the organization.
The executive committee tops the structure of the board, and consists of the board president, vice-president, treasurer and secretary. The president is responsible for steering, governing and representing the board, and the vice-president steps into these duties if the president is unable to function. The treasurer takes account of the organization's finances, and is often in charge of presenting financial reports and working with the agency's contracted accounting firm to document revenue and expenses, and to file the agency's annual IRS 990 form. The secretary is responsible for documentation of board meetings, the distribution of meeting minutes, and handling correspondence. Each Executive Committee member carries one vote on the board.
Additional board members are usually known as directors. These individuals should have a variety of experience, skills and knowledge that benefit the non-profit organization. It is important to choose directors who are willing and able to give time and service to the organization, rather than individuals who seek board membership solely for community status. Each director carries one vote on the board. A board of directors may also have several advisers. An adviser is a person who has some sort of special expertise. These individuals may advise a board, but are not voting members of the board.
The CEO, President or Executive Director of a non-profit is responsible for administering policies and procedures, programs, services and the staff of the organization. While this person is generally required to attend board meetings, she does not carry a vote on the board. The Board of Directors oversees the position of CEO, President or Executive Director, providing a job description for the position, guidance and disciplinary procedures. The board is also responsible for hiring and firing the person in this position, should it be deemed necessary.
The board of directors is responsible for creating the by-laws that govern a non-profit organization. A board of directors should not micro-manage a non-profit, but should develop its policies and procedures. The president, CEO or executive director is responsible for making sure the entity operates under those policies and procedures, oversees staff, works to develop funding and manages the budget. The board is responsible as a whole and as individuals to market the organization and to work to build its funding base. Additionally, the board must set an ethical example for the agency's administration and staff.