BOARD EVALUATION

Bill Taylor, UW Area Community Development Educator

References

• The Handbook of Nonprofit Governance by BoardSource, published by Jossey-Bass, 2010

• The Board Chair Handbook, Second Edition by Mindy R. Wertheimer, published by BoardSource, 2008

• The Nonprofit Board’s Role in Mission, Planning and Evaluation, Second Edition by Kay Sprinkel Grace, MA; Amy McClellan, MNO; John A. Yankey, Ph.D., 2009

• The Board Building Cycle: Nine Steps to Finding, Recruiting, and Engaging Nonprofit Board Members, Second Edition by Berit M. Lakey, published by BoardSource, 2007

References (cont.)

• Evaluating Board Performance by Bob Cropp, Director, University of Wisconsin Center for Cooperatives, January 1966 at http://www.uwcc.wisc.edu/issues/Governance/board.html

• Board Performance Evaluation; Private Sector Opinion, Issue 9 by the International Finance Corporation at http://www.gcgf.org

• Corporate Governance: A Primer on Board Member Evaluation by Bill Capps and Rob Steinberg of Jeffer, Mangels, Butler & Mitchell LP at http://about.bloomberglaw.com/practitioner-contributions/corporate-governance-a-primer-on-board-member-evaluation/

“Exceptional boards embrace the qualities of a continuous learning organization, evaluating their own performance and assessing the value they add to the organization.” The Source: Twelve Principles of Governance That Power Exceptional Boards

EXCEPTIONAL BOARDS

• Results-oriented• Measure overall efficiency,

effectiveness, impact, outcomes• Can’t afford complacency – keep

discovering ways to increase their value

EVALUATION

“Figuring out something’s worth by looking at it carefully.”

• Assessing the effectiveness and performance of the organization, its programs and its services

POTENTIAL• Identify issues pushed aside during

normal business• Identify strengths & weaknesses

affecting optimal performance• Keep the board focused, on track• Allow board chair, members, & chief

exec. to assess growth & progress in their roles

POTENTIAL (cont.)

• Reinvigorate individual board members to take responsibility as part of the team

• Reinforce that the board takes its work seriously & models good governance

WHEN

• Varies with organization• Suggested:– Brief evaluation annually– Extensive every 2-4 years

WHO

• Governance committee• Ad hoc committee• Outside consultant• Board chair and the membership in

partnership

LEVELS

• Organizational – extent to which the organization has met its stated goals & objectives & how well it performed in the process

• Programmatic – efficiency and outcomes of various or individual programs

• Board – how well the board as a whole is functioning and understanding its role

LEVELS (cont.)

• Individual Board Member – how well each member is fulfilling his job description

• Board Chair – is the chair a good leader and facilitator?

• Chief Executive – how well is the chief executive fulfilling their job description and assisting the organization to their annual goals?

LEVELS (cont.)

• Levels can be coordinated, mixed, or only certain ones performed, according to needs and structure of the organization

ORGANIZATIONAL EVALUATION

• One method – dashboard reporting– Attached to meeting agenda– 1-2 pages – graphs, charts, tables,

columns, limited text• Showing progress toward goals & objectives

– Indicators to monitor:• Finances• Programs• Quality control• Human resources

ORGANIZATIONAL EVALUATION (cont.)

– Benefits of dashboard reports:• Supports planning• Identifies performance drivers• Prioritizes information• Identifies problems early• Increases efficiency

*ORGANIZATIONAL EVALUATION EXERCISE – 15 minutes

PROGRAM EVALUATION

• Provides accountability to funders• Takes subjectivity out of justifying the

organization’s existence• 2 components– Outcomes measurement

• How a program is working – its results

– Performance measurement• The inputs & outputs of a program• Quality & effectiveness of the program

implementation

PROGRAM EVALUATION (cont.)

• Based on qualitative & quantitative data

• Methods– Surveys, interviews, focus groups, pre-

& post-tests, observations, assessments of products from program participation

BOARD SELF-ASSESSMENT

• How well is the board meeting its responsibilities?– Examine:• Composition• Identification & recruiting of new members• Relationship w/ constituents/stakeholders• Relationship w/ chief executive• Does committee structure work?• Are meetings well run?

BOARD SELF-ASSESSMENT (cont.)

• Questions:– Is board clear about its roles &

responsibilities?–Members familiar and in support of

mission? Is mission appropriate for organization in 2-4 years?

– Has board engaged in setting a strategic direction? Is there a vision of the strategic evolvement of the organization over the next 3-5 years?

BOARD SELF-ASSESSMENT (cont.)

• Questions (cont.)

– Is board knowledgeable about the programs? Is there effective processes for tracking program performance?

– Does board understand the finances & resource strategy? Do all members participate in any fundraising?

– Does budget reflect priorities of strategic or annual plan? Are financial controls in place? Are there established investment & risk management policies?

BOARD SELF-ASSESSMENT (cont.)

• Benefits:–Moving from micromanaging

organization’s work & directing focus on governance

–More engaged & higher-performing board

– Developing team-building skills & better problem-solving structure

– Showing stakeholders board members take responsibility seriously

– Improved board-staff relations

BOARD SELF-ASSESSMENT (cont.)

• Benefits (cont.):– Clarification of division of labor– Identification of board structures

needing improvement– Development of an action plan

BOARD SELF-ASSESSMENT (cont.)

• When:– Every 2-3 years– Exploring roles & responsibilities– Identifying gaps in performance– Discovering problems– Developing plans for the future

BOARD SELF-ASSESSMENT (cont.)

• When (cont.):– Critical points:• In early stages of the organization’s life,

especially when hiring the 1st staff• There is confusion about which

responsibilities belong to the board and which to the staff• During changes of leadership on the board

or of chief executive• When doing strategic planning

BOARD SELF-ASSESSMENT (cont.)

• Techniques:–Mini or complete assessment• Easy to complete surveys• Anonymous responses to encourage candid

comments• Compiled in report to board• Sample from The Handbook of Nonprofit

Governance• Culminate w/ extended board session or

retreat to discuss & identify action steps

– Regular board training

BOARD SELF-ASSESSMENT (cont.)

• Techniques (cont.):– External Audit

• Engage expert in governance• Review articles of incorporation or establishing

resolution, bylaws, observe board & committee meetings; interview officers, board members, former board members, & chief executive

• Written/oral report to board and chief executive• BoardSource provides online and custom

evaluations– www.boardsource.org

BOARD SELF-ASSESSMENT (cont.)

• Techniques (cont.):– Evaluating board meetings• 10-15 minute item on each agenda for

discussion– “Ideas for Improving the Board”

• Feedback form or round of comments at end of each meeting– 2 questions:

» “The thing I most liked about this meeting was…”

» “One thing that could have improved this meeting was…”

BOARD SELF-ASSESSMENT (cont.)

• Techniques (cont.):– Evaluating board meetings (cont.)

• Items to address:– Dealt w/ issues of substance & strategic importance?– Run efficiently?– Used board member’s time wisely?– Well organized?– Background materials available in advance?– Begin & end on time?– Everyone’s voice heard or did a few dominate?– Issues were discussed & debated?– Was something achieved? *Board Meeting Evaluation Exercise

– 2 minutes

BOARD SELF-ASSESSMENT (cont.)

• Outcomes of a good board assessment:–Measure progress– Identify areas needing improvement– Establish goals for the future– Remind members of their

responsibilities– Reshape operations– Build trust, facilitate communication– Identify strategic planning initiatives

BOARD SELF-ASSESSMENT (cont.)

• Outcomes of a good board assessment (cont.):– Improvements in monitoring program

effectiveness– Enhanced board meetings & more effective use

of committees– Improvements in process of reviewing chief

executive’s performance– Strategies for more intentional board

recruitment– Establishment of a governance committee &

and a more thoughtful nomination process

*Full Board Evaluation Exercise – 8 minutes

BOARD MEMBER EVALUATION

• Two methods– Self-assessment• Based on the board member job description

or the individual section of a board assessment instrument• Sample from The Handbook of Nonprofit

Governance

BOARD MEMBER EVALUATION (cont.)

• Two methods (cont.)

– Peer evaluation• A brief anonymous survey – each board

member rates others on items such as:– Attendance– Preparation– Follow-through on assignments– Quality of participation in discussion– Interactions w/ other board members– Interactions w/ staff

• Results tallied & shared privately w/ each board member* Board Member Self-Evaluation Exercise – 15 minutes

BOARD CHAIR EVALUATION

• Benefits:– Clearer view of the position & its

requirements– Clarifies the work of the chair & where

improvement is desired– Helps prevent informal mumbling &

private discussions about the chair

BOARD CHAIR EVALUATION (cont.)

• Focus:– Facilitation skills– Relationships & interactions w/ board

members– Use of board work structures– Use of governance practices

BOARD CHAIR EVALUATION (cont.)

• Handled by fellow board members (never the chief executive)

• Anonymous survey• Communicated directly to chair in

private discussion

CHIEF EXECUTIVE EVALUATION

• Job description– Must be clear, unambiguous– Basis for evaluation and measurement

• Expectations– Annual expectations should be listed to

identify priorities and projected accomplishments

CHIEF EXECUTIVE EVALUATION (cont.)

• When– End of fiscal year

• What to evaluate– Success in meeting organization’s overall

goals– Strategic alignment w/ board’s directives– Accomplishment of management objectives– Programmatic & fundraising achievements– Fiscal management– Relationship w/ board, staff, community

CHIEF EXECUTIVE EVALUATION (cont.)

• Process– Organized by board chair– Should fit the culture of the organization– Should enhance working relationship between

board & chief executive– Determine which instruments to use, who should

be involved, how results will be communicated– 2 components

• Self-evaluation• Board member questionnaire

– Comments compiled, tabulated

CHIEF EXECUTIVE EVALUATION (cont.)

• Written report– Shared privately with chief executive• Placed in personnel file

– Provided to entire board

QUESTIONS? COMMENTS?