FUNDAMENTALS OF EFFECTIVE BOARD GOVERNANCE

North Texas Unitarian Universalist Congregations

February 8, 2014

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

General Session Objectives

• Why is good governance important?• Overview Effective Board Governance models

• Describe six primary functions of boards • Examine modes of governance

• Assess your board’s effectiveness together• Approach governance as a spiritual practice and shared ministry

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

Board Effectiveness • “There is one thing all boards have in common…They do not function.”

Drucker, 1974

• “Ninety-five percent (of boards) are not fully doing what they are legally, morally, and ethically supposed to do.”

Geneen, 1984

• “Boards tend to be…incompetent groups of competent individuals.”

John and Miriam Carver, 2001

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Definition of Governance

Seeing to it that the organization achieves what it should and avoids unacceptable situations.

John Carver

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Benefits of Good Governance• Provides continuity of board leadership

• Provides transparency and consistency in decision making

• Creates methods for urgent action that can foster responsiveness

• Protects the organization

• Focus on purpose, vision and growth

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Six Primary Functions of the Board

1. Visioning

2. Policy making

3. Stewardship

4. Sponsorship

5. Advocacy

6. Consultancy

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Visioning and Policy-making

Should be at the forefront of the board’s work, in collaboration with the congregation’s

professional and volunteer staff.

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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As stewards …

Board holds the congregation’s assets in trust, including moral and other intangible assets.

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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As sponsors …

Board should collectively be among the most generous supporters of the congregation with both time and money

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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As advocates …

Board represents interests of the congregation as an institution both to its own members and, even more importantly, to the wider community.

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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As consultants …

Board members are available to the staff – at the staff’s invitation – to provide counsel and encouragement from their particular areas of expertise

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Board Team Assessment – Part 1

• Choose convener, scribe, and timekeeper• Assess your board’s maturity (low, medium, high) on each of the six functions:• Visioning, policy making, stewardship, sponsorship, advocacy,

and consultancy

• Discuss how to move the board’s maturity to a higher level

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Six Primary Functions of a BoardKey Messages

• Most boards are well-intentioned but not fully effective• Effective Governance keeps the board focused on its role• Effective Governance provides continuity in leadership• Effective Governance sets the framework for decision-

making transparency• Maturing as a board is a journey

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Models vs. Modes

Richard Chait and his colleagues argue that we should shift emphasize to modes over models in seeking to govern well.

Source: Richard Chait, William Ryan and Barbara Taylor, Governance As Leadership: Reframing the Work of Non-profit Boards (Hoboken: John Wiley & Sons, 2005)

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Governance as Leadership

Type

1: F

iduc

iary

Type 2: Strategic

Type 3: Generative

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Type I: Fiduciary Governance

Safeguards the mission against unintentional drift and unauthorized shifts in purpose

Speaks with one voice.

Promotes lawful and ethical behavior.

Ensures that resources are deployed effectively.

Prevents theft, waste or misuse of resources.

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Type II: Strategic Governance

Builds authority, responsibility and accountability into the system.

Crafts forms and structures to mirror the congregations priorities and values.

Aims to construct a consensus about what the congregation’s strategy should be.

Oversees strategic planning process and articulates what matters most for the future.

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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What is Generative Thinking?

A cognitive process for deciding what to pay attention to, what it means, and what to do about it.

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Type III: Generative Governance

Engages others within (and beyond) the congregation in generative thinking.

Chooses and uses new frames of reference.

Reflects on the big issues facing the congregation.

Thinks retrospectively and constructs the congregation’s “dominant narrative.”

Defines what knowledge, information and data mean.

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Going from Good to Transformational

A functional board is a Level 1:

Fiduciary

A good board moves to Level 2:

Strategic

A great board becomes a

Level 3: Generative

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Board Team Assessment – Part 2

• Reconvene in your board teams• Assess your board’s performance on fiduciary, strategic, and generative performance (Low, Medium, High)

• Refer to the fiduciary, strategic and generative considerations on the assessment worksheet.

• Discuss how your board can improve on each of the three modes

• Be prepared to discuss your assessment in the topic sessions through the day

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Modes of Governance LeadershipKey Messages

Going from Good to Transformational

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VISIONINGNancy Foreman

Horizon

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POLICY MAKINGAnita Mills

Oak Cliff

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STEWARDSHIPMary Noer

Westside

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Board Team Reflection and Action Planning

• Take a few minutes personally to complete p.6 of the Board Assessment (Action Plan Worksheet)

• Discuss Action Plans with Board Teams• Agree on three top priorities with your Board Team

• Prepare to report out to the whole group

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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WRAP-UP DISCUSSIONWhat are Key Take Ways?

What the Key Messages for Your Boards?

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Implications for the Board

• Scale governance model to the size of the congregation

• Consider annual board retreat• Acquire governance training periodically• Consider voices not at the table• Acquire cultural competency

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Implications for the Board

• Acknowledge ownership of the governance process by the board

• Acknowledge the power and authority granted to board via representative democracy

• Be intentional in communications and disclosures to the membership

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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Humanity of Governing

• Requires the goodwill of the congregation• Inquiry must preempt judgment• Consultation underlies decision making• Listen respectfully• Governance is a spiritual practice• Governance is shared ministry

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Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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TOWARD EFFECTIVENESS GOVERNANCE Originally presented at NTAUUS Boards Training

July 14, 2012

Jim Key

jckey@hargray.com

843.812.6647

Used with permission by Jim Key, from Toward Effective Governance, 7/14/12

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