The Relationship Between Non-profit CEOs & the Board Chair

The relationship between nonprofit CEOs and board chairmen is similar to the corresponding relationship in the business world. Each has a distinct role to play in the governance of the organization, and each is directly responsible for the overall success of the enterprise. The primary difference between the nonprofit and the for-profit world is that in charities, they are both responsible to the people they serve, while in businesses, they are both responsible to shareholders.

A nonprofit board chairman serves as the executive leader of the organization's board of directors, which has ultimate governance responsibility for the charity. The board holds the final say on the overall strategy of the nonprofit, as well as hiring and firing authority for the executive staff of the organization. The board also controls the budget of the organization. As the leader of the board, the chairman carries immense sway over the program and fundraising strategy of the nonprofit. At most nonprofits, the board chair also serves as one of the primary public faces of the organization.

The chief executive officer of a nonprofit (sometimes called the executive director) is the top administrator of the organization. The CEO is hired by and reports to the board of directors and implements the strategy dictated by the board. The CEO manages the staff and day-to-day operations at the nonprofit, and she is responsible for making tactical decisions required for meeting the goals set by the board.

The CEO of a nonprofit reports to the board of directors and thus to the board chair. Depending on the legal structure of the organization and the employment contract of the chief executive, the CEO may serve completely at the pleasure of the board or board chair. The board sets strategy, the CEO implements that strategy and then she reports back to the board on the results of the work that was undertaken. Because she leads the day-to-day operations of the nonprofit, the CEO often possesses wide-ranging input into the decisions of the board and the board chair.

The personal relationship between the CEO and the board chair at a nonprofit will depend on the personalities of the individuals occupying those roles as well as the nature of the nonprofit organization. Some nonprofits tend to appoint business leaders as chairmen while hiring program specialists as CEOs. This is particularly true at arts organizations, where the chair may be a businessman while the CEO is a former dancer or accomplished director. This can lead to tense interpersonal relationships due to different worldviews. Regardless of the background of the CEO and the board chair, when the two roles clash it often presents problems for the organization that must be rectified by the board of directors to ensure smooth operation of the nonprofit.