In a nonprofit organization which responsibilities belong to the Board of Directors, and which belong to the Executive Director? And how can both avoid stepping on each other’s toes?
This is one of the most contentious topics in nonprofit leadership!
Trying to determine where the board ends and the ED begins is one of the most common issues that organizations struggle with (and a main reason why they bring us in to help!) because every organization handles executive responsibilities differently, and some nonprofits have historically had an unhealthy division of duties that influences their perspective on this issue.
Broadly speaking, the Board is responsible for strategy and governance while the Executive Director is responsible for implementation and management. However, both should work in partnership to support each other’s roles, building respect and trust to leverage each other’s strengths effectively. There is no hard line where one ends and the other begins, but there are spheres where each tends to operate.
Let’s break down what a common nonprofit division of duties looks like to give you a general outline that you can use to guide your own organization, with the understanding that some nonprofits may have completely valid reasons to deviate from this structure to address their own specific needs.
Board Responsibilities
Executive Hiring – A nonprofit’s Board of Directors is uniquely positioned to manage the organization’s Executive Director. This means making hiring decisions and conducting regular performance reviews (and even terminating the ED if the need arises to do so).
Strategic Planning – The Board will oversee the organization’s vision and strategic direction and make decisions related to the execution of its overall mission. They will determine how best to serve their audience, adapting as needed and responding to opportunities to collaborate as they arise. However, this is certainly not done in a vacuum! The Board may initiate or endorse a strategic vision, but they will also need to rely on their Executive Director to provide the broader context needed to ensure it’s viable.
Financial Oversight – A Board will approve the annual budget and oversee the organization’s financial performance at a high level to ensure fiscal sustainability. Additionally, they will oversee audits and financial reporting to act as responsible stewards of the organization’s finances. They will rely on their Executive Director in this area as well, to make sense of the numbers and understand what their budgeting needs are on an ongoing basis. If the head of the Board is less financially savvy, the Board may rely on third-party advisory services from a respected nonprofit consulting firm to provide added financial leadership assistance.
Fundraising – The board will not only set fundraising goals and strategies but may also connect individually with current and potential donors as part of their involvement in donor relations. While they typically will not lead the organization’s fundraising efforts, they may play an integral role in cultivating key relationships through personal and professional connections.
Development – Board members will also have a close relationship with partnering organizations and other key stakeholders as part of their ongoing development activities. It is the Board’s job to know when to say “yes” and when to say “no” in this area to keep the organization on track, ensuring that mission creep does not occur from being pulled in too many directions at once. Boards with less experienced members may share this responsibility with the Executive Director to some degree to offer additional perspective and guidance.
Governance and Policy – One of the most well-known responsibilities of the Board is governance oversight. Boards must establish and uphold policies that are compliant with applicable legal and regulatory standards. But governance covers more than legal matters. Boards must also maintain high ethical standards in leading the organization.
Advocacy – Nonprofits can also influence governance and regulatory issues through public advocacy efforts. Boards may get involved politically as a means of working to change state and federal legislation to be more favorable to their activities.
Public Relations – When nonprofits need to be represented publicly, the Board’s President or Director may act as the organization’s spokesperson. If this responsibility falls under the Board’s purview, the head of the Board will act as an ambassador to make public announcements, talk to media outlets, communicate with other organizations’ Boards, and publish official information. However, depending on individual personalities and strengths, this responsibility may be a better fit for the Executive Director.
Executive Director Responsibilities
Operational Leadership – The Executive Director (ED) is primarily responsible for taking the Board’s strategic plans and implementing them effectively. An ED will oversee the organization’s day-to-day operations and manage staff, leading from the frontlines.
Programming – EDs develop and execute programs and initiatives that support the organization’s overall mission. It is their responsibility to ensure that programming runs smoothly, stays on budget, and serves the needs of the community effectively to provide desired outcomes. Newer EDs may rely on an external nonprofit consultant for help with the financial management of these programs to ensure that they are a wise use of the organization’s resources.
Financial Management – The ED develops the budget that is presented to the Board for approval. In the preparation of the budget the ED will need to understand where money is being spent currently and what the organization’s future needs are to meet its goals. After the budget is approved (either as presented or with modifications) the ED will be required to manage the organization’s finances and other resources with respect to the budget.
Donor Relations – As the people at the helm of the organization, EDs will lead the organization’s fundraising strategy by connecting with major donors and corporate sponsors. They will implement, analyze, and adapt fundraising campaigns to generate the funds needed for the organization to thrive and then they will report back to the Board on these efforts.
Cultivating Relationships – As you might have guessed, an ED is expected to be a people-person! An ED will represent the organization to cultivate relationships with partners, stakeholders, and the community at large. When the role of spokesperson is not filled by the head of the Board, the ED will act as the ambassador to the public for all official written and verbal communication.
Working Together
Effective communication and collaboration between the Board and the Executive Director are crucial in ensuring organizational success. To maintain a strong relationship between the Board and Executive Director and help them both to succeed, focus on:
- Improving onboarding and training.
- Providing access to professional development and resources.
- Collaborating to align efforts.
- Creating accountability in their respective roles.
- Communicating regularly and honestly.
- Addressing questions and concerns head on.
- Creating a culture of transparency.
- Assessing performance objectively and giving constructive feedback.
Dedicating the necessary resources to develop board members and support them in their roles is also important! Ensure that your organizational culture is open and inclusive, values diversity, and recognizes individual accomplishment to make everyone feel valued. Offer the coaching, feedback, and mentoring needed to help board members to achieve their full potential and grow in their roles to foster an environment of continuous improvement.
When you need nonprofit consulting, please reach out to us! Our team brings many years of nonprofit leadership experience to the table to assist your organization in better serving its community. We offer board advisory services as well as nonprofit organizational leadership. See who we’ve worked with before on interim and consulting engagements and what makes us different in our mission to serve organizations like yours!
