Board members of non-profit organizations have many responsibilities. However, governance is among the most important. They are accountable for ensuring that the charity abides by the law, has prudent financial management guidelines, and is on track to meet its objectives. Unlike for-profit companies there is no ownership stake in charitable organisations, and nonprofits rely on volunteer boards to manage them effectively and ensure that they are financially sustainable for the long-term.
Non-profit organizations can choose from a variety board governance models. Some might even mix a few to meet their specific needs. The best model is essential to building a strong board. It helps an organization stay focused on their goal and help establish a culture that is based on transparency, accountability, and innovation.
The Management Team Model is the most well-known model of governance for nonprofits. In this model, board members delegate the tasks to committees and staff which are responsible for a variety of duties, including human resources and finance. The board continues to exercise its leadership position when it comes down to hiring and directing the executive director.
Another common model is the Patron Board Model. This type of board consists of a number of wealthy donors who serve as the board. They have a high level of trust and confidence in the CEO’s ability to run the business. The board does not participate in day-today activities but they do regularly meet to ensure that the CEO keeps them updated on the company’s activities.