Why this Guidebook?
This guidebook is a simple tool to help new Campaign for a Commercial-Free Childhood (CCFC) board members understand the organization and their roles and functions in helping CCFC reach new heights. CCFC is deeply grateful towards your passion and willingness to serve on the board and understand that leadership takes courage. As a board member, you hold an essential responsibility to govern the organization and strategically direct it. This guidebook helps you touch base with the organization and your function as a board director, to assist you in both: the onboarding process and the role fulfillment process. Nevertheless, this is only a guidebook. The real success, however, lies on your commitment, clear understanding of expectations, and actions. We trust you and look forward to new achievements under your leadership.
Statement of Disclosure
This guidebook is prepared by Darshana Shakya, a student of Northeastern University College of Professional Studies, as a part of her final project in the ‘Legal and Governance Issues in Nonprofit Organizations’ course. I currently work as an employee in CCFC, and the content in this guidebook was developed with an objective to strengthen my knowledge of board governance and legal duties. The information provided in this guidebook has been reviewed and approved by CCFC and is in accordance with their policies. I hope to provide this guidebook as a resource to the board members of CCFC, to help them improve the efficiency and effectiveness of the board.
Now, you are on the board. What Next?
CCFC selects board directors on the basis of their commitment towards CCFC’s mission and their individual area of expertise in fulfilling the needs of the board. Now, you are on the board. What Next? Often the question can be overwhelming but CCFC has put together a list of basic expectations for oncoming board directors to help answer this question and also maintain effectiveness of the board. As a board director you are expected to:
Understand the CCFC mission, services, policies and programs
Increasing your understanding of CCFC, its mission and programs is the number one responsibility of a board director because it helps you determine if the organization is heading to the right direction or not. It also helps identify areas of contribution for board members in line with their expertise.
RISK! Because we are operating under Third Sector New England (TSNE) fiscal sponsorship (explained in the next section), note that if the organization’s mission changes, it is crucial to ensure that the new mission state purpose that is in line with TSNE’s mission, which is to build the leadership and effectiveness of individuals, groups, and nonprofits to support a more just and democratic society. If our missions are incompatible, it might risk our partnership with TSNE MissionWorks.
Understand your duties and responsibilities as a Board member
To explain more clearly, CCFC is a public charity and is currently receiving its tax-exempt status under the federal law as a fiscally sponsored project by TSNE MissionWorks. Fiscal sponsorship simply means there is a formal agreement, of an established public charity, which is willing to share its tax-exempt status with another relatively small charitable group because, it contributes to their mission. Hence, mission compatibility is important. Under this agreement, TSNE manages and oversees all operations of CCFC under its corporate structure. The board of CCFC serves as the required advisory board under the memorandum of agreement with TSNE. Here is how the role of TSNE MissionWorks and CCFC Board differs, under fiscal sponsorship:
TSNE’s Role
Board of Director’s Role
Responsible for providing general management, financial, administrative and human resources support.
Responsible for providing assistance in the areas of project policy development, fundraising, and organizational development.
Legally responsible for the project, and all current and future project employees become direct employees of TSNE.
Monitor and evaluate the performance of Project Directors.
Help build internal capacity of CCFC and CCFC staff by providing training, periodic assessment and consultations when necessary.
Provide the fiscal sponsor (TSNE) with advice and recommendations regarding personnel, financial and administrative matters as well as other issues related to CCFC
IMPORTANT
Board members must note that TSNE’s role is only supportive and supervisory in nature. All the major strategic decisions regarding CCFC like hiring the executive director, determining compensations and reviewing, planning CCFC’s strategy, investing organization’s assets, and resolving any conflicts of interest, etc. are undertaken by the board. For example, while the annual budget is administratively supervised by TSNE, it is developed and reviewed by CCFC board and implemented directly by CCFC staffs. Hence, board members must exercise their rights to vote and ensure that board decisions are made by simple majority of a quorum.
Basic Board Structure
CCFC board constitutes four board of directors officers namely, i) Chair, ii) Vice- Chair, iii) Clerk, and iv) Treasurer. It also has five Standing committees:
These Standing committees provide you with an opportunity to gain information required to actively make sound judgment as a board director. CCFC is committed to provide you with the necessary information and board members should actively engage in the committees they serve in. Board directors can find the details of these committees and officers role in the CCFC Bylaws provided by the Chair in the orientation kit. However, board should practice due care in decision-making within their committees as well. For example: In order to decide on compensation, executive committee members should base their decision on independent review of executive director’s compensation, review of compensation paid by similar organization, and conduct timely performance evaluation.
RISK! Although CCFC is granted a charitable status under TSNE MissionWorks, it must still comply with the laws, regulations and accounting standards governing the use of nonprofit funds, like any other charitable organization. If CCFC is found to use fund for non-charitable purposes either by TSNE MissionWorks or Internal Revenue Service (IRS), it can lose its fiscal sponsorship and tax-exempt status. Hence, board members must be cautious and fully disclose project activities to TSNE, so they can seek advise from TSNE wherever necessary.
Engage and make personal financial contribution towards fundraising for CCFC
One of the responsibilities of the board is to ensure that the organization has adequate resources to advance their mission. Board members are expected to actively reach out to prospective donors, build donor relationship and contribute towards raising funds for CCFC. In addition to helping solicit funds through personal and professional networks, board members are also expected to financially contribute to CCFC.
Hold yourself and your fellow Board members accountable
Accountability is one of the prime factors in determining the organization’s sustainability. The success of the organization is your responsibility. As a board member you are expected to hold yourself and your fellow board members accountable for the CCFC mission, financial viability, and the effectiveness of the organization. Board members must periodically review that the programs and activities conducted are within the scope of CCFC’s mission. Is it contributing towards achieving our mission?
Responsibility for protecting assets and providing financial oversight
In addition to the above, board members are also answerable to donors and the beneficiaries. They must ensure resourceful use of funds and question any unexplained discrepancies in the financial report presented by
Chief finance officer. Importantly, board members must manage financial risks as a core responsibility, and finance committee must especially be vigilant regarding it.
RISK! Lack of financial oversight could lead to inaccurate financial reporting, failure to meet legal filing requirements, and might also risk the reputation of the organization in worst cases. It might also jeopardize CCFC’s partnership with TSNE MissionWorks.
Some measures to manage such risk include:
Responsibility for monitoring and strengthening programs
Furthermore, it is also their duty to monitor, assess, and strengthen the quality of programs, to help maintain relevancy and effectiveness of the organization. A case in point, if a new program of CCFC does not contribute to the CCFC’s mission and instead strays away from promoting healthy childhood; it is the responsibility of the board to question the executive director on the program’s relevancy.
Top 5 Board Priorities for 2016/2017
Fundraising
Development plan with fundraising goals (Development Committee)
Bringing new members with development skills on board (BM&G Committee)
Financial modeling, including year-by-year projections (Finance Committee)
Foundation strategy and outreach plan (Development Committee)
Board Cohesion
Board only meets once a year in person, so encouraging connection between meetings/calls (Executive Committee)
Creating new lines of communication and contact between board & staff, to keep board up to date on programs and ease ways to participate in/support campaigns and actions (Staff)
Board Leadership Development
Short term task force to determine who is in charge of implementing which aspects (Executive Committee)
Ensure smooth Vice Chair/Chair transition and new treasurer (BM&G Committee)
Networking
Develop short term task force to determine networking opportunities
Include staff and board to build networks around programs, development, etc.
Focus on helping Board members be consistent ambassadors for CCFC
Communications Plan
Develop and implement the communication plan
Serve as an Ambassador for CCFC by informing others about the organization
Board members are expected to represent themselves as frontline advocates for the CCFC’s mission. Any forms of communication with the public or relation building like interacting with the masses, donors, or interviewing with media will help expand our reach. It will help CCFC grow and flourish.
Support board decisions and treat board matters confidentially
It is essential to remember that the board as a whole has the authority, and not any individual member. The Board functions as a unit and every decision is an outcome of collective understanding. Board members need to:
♣ Contribute to the decision-making process and raise questions
♣ Offer a critical perspective wherever required, on the basis of their individual expertise
♣ Understand the sensitivity of information shared on the board
♣ Own up to the decisions made by the board and be answerable to it
All in all, board directors are expected to support board decisions and treat any board related information with confidentiality.
Make a Commitment of Time
CCFC understands that board members have their own engagements, however it is of utmost importance that board members realize that the success of the board lies heavily on their commitment. Board members are expected to spend at least 3 hours per month on activities related to their service on the CCFC Board, including preparation for and attendance at Board meetings, committee meetings, and CCFC functions and events. You are expected to attend every Board and committee meeting (in person or electronically), but should inform the Chairperson in advance if you will be unable to attend.
Importance of your Fiduciary duties
As a nonprofit organization’s board member, you are entitled as a fiduciary, entrusted to protect and act in the best interest of the organization, in good faith. As a fiduciary of CCFC, you hold the organization in trust for the public benefit. In which you have two primary duties: the duty of care and the duty of loyalty.
Duty of care simply means that you must exercise reasonable care, and make informed decisions as a normally prudent person would, when acting on behalf of the organization. For instance, if you consistently miss board meetings and do not pay due attention in undertaking financial decisions, because TSNE is supporting CCFC’s financial and administrative operations, it would mean you are neglecting your duty of care.
Duty of loyalty, on the other hand, mean that you must always act in good faith and in a manner that you reasonably believe is in the best interest of the organization. An example of breaching duty of loyalty, would be if a board member who while representing the organization, enters into contract with a service provider devoid of competitive bidding, with the intention to advance his private business relation. This example also indicates the importance of understanding conflicts of interest, which in simple terms mean a transaction/arrangement that benefit a board member/officer or an employee at the cost of the organization’s benefit.
Watch out for Conflicts of Interest
As a board member you need to be cautious about a potential conflict of interest between your own financial interests and your duty as a board member of the organization. CCFC expects the board members to review CCFC’s Conflict of Interest Policy and clearly understand the difference and disclose any such conflict, when it arises. CCFC Bylaws states:
Start engaging yourself
You can check out our Annual report 2016. Our activities have been possible due to the sincerity and hard work of our vibrant team of leadership and executives. We are glad to have you on board with our team and you can start by getting to know our Board members and CCFC staffs. We also actively share our news and ideas on social media. Connect with us on Facebook and Twitter. We would love to share your ideas and concerns regarding our mission.