Selecting Officers and Members of the Board: Does the CEO Have a Say?
Recently, in a meeting with a colleague a question came up about the process of engaging leadership and finding the most appropriate person to lead a nonprofit organization. Every nonprofit organization goes through a process every two to five years of selecting a new volunteer leader who serves as president or chair of the board of directors. The official name of the position depends on the culture of the organization as stipulated in the nonprofit’s by-laws. In general, the person in this role, the person is the volunteer “head” of the organization and is responsible for chairing the meetings of the board of directors and officially represents the organization in public events. The chair of the board leads the process of establishing policies and is responsible for the fiscal accountability of the agency, among other duties.
The chief executive officer (CEO) is head professional who is responsible for implementing the policies and the services of the organization successfully within the budget approved by the board of directors. The CEO is hired by the board and is accountable to the chairperson. In many nonprofits the CEO is evaluated annually or periodically by the chairperson and the level of compensation is dependent upon the evaluation and the financial situation of the organization. It is not unusual for the CEO to experience the board chair as a “boss” as well as a partner in developing the organization. In an earlier post I wrote about this relationship.
While formally, the by-laws define the position and set the terms of office, the actual selection of the chair of the board is often a political process. It is an accepted practice for the board to have a nominating committee that both suggests names of potential board members as well as names for the agency’s voluntary officers, such as chairperson, co-chairperson, secretary, treasurer and other relevant leadership positions. Often former chairpersons and officers are members of the nominating committee since they are familiar with the agency and are thought to have less of a self-interest in who will be recommended to fill the leadership positions. As a result of the past experience in leadership positions they are often more invested in the organization as a result, are more altruistic in their motives?
When it comes to selecting board members, it is the informal relationship between the CEO and the board chair that really determines the outcome. Since the relationship between the CEO and the board chairperson is so important for the successful and smooth running of the organization there are a variety of interests at play in looking for the right person. Much depends on the standing the CEO has with the agency, the board, and the community.
When the CEO is a valued member of the organization’s management and has a good working relationship with the board then there may be interest in consulting with the CEO about appropriate people to be considered for role of the chairperson. The chairperson of the nominating committee may consult with the CEO about potential candidates and ask for an assessment of their leadership abilities and the qualities they would bring to the position. There might even be a discussion of the CEO’s perception of the working relationship that would be developed with each of the candidates. At the same time, it is just as appropriate for the CEO to be consulted about who he thinks would not be a positive addition to the agency’s board.
If the CEO is perceived as not fulfilling the responsibilities of the job then the nominating committee may turn to another respected person who can suggest names in a sensitive and diplomatic fashion. If this is the case then they may even keep the CEO out of the process. There is no doubt that this would be an uncomfortable situation for all, but one that is not uncommon to voluntary organizations.
Certainly, there are times when the CEO’s opinions will be sought out during the nomination process. However, as in all matters relating to the selection of new board members, the ultimate responsibility for the agency’s policies, its standing in the community and its fiscal solvency is in the hands of the volunteer leaders. That is why it is so imperative that board members stay independent and through their active involvement will work to develop and strengthen the organization.
Any inappropriate involvement in the selection of board members or officers by the CEO will ultimately weaken the agency. Volunteer leaders who are too strongly aligned with the head professional will be compromised in their ability to lead the organization. The independence of the board is one of the most important strengths of the nonprofit organizations.
Undoubtedly, the CEO’s counsel and advice should be sought when identifying and nominating potential leadership, but at the same time, limits must be set to guarantee the board’s independence. It is important to find the right balance and utilize professional resources in the most appropriate way. At the end of the day, this will be better for the professional leadership and the volunteer leadership who together can ensure the sustainability of the voluntary organization.
Stephen G. Donshik, D.S.W., is a lecturer at Hebrew University’s International Leadership and Philanthropy Program and has a consulting firm focused on strengthening non-profit organizations and their leadership for tomorrow. Stephen is a regular contributor to eJewish Philanthropy.