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Purpose of Nonprofit Board Meetings
A nonprofit Board of Directors is legally responsible for governing, budgeting and overall oversight of a nonprofit organization. The board has an obligation to keep the nonprofit on mission, to make sure it operates efficiently and suggest remedial action wherever performance falls short.
In addition to submitting an annual tax return for an exempt organization or Form 990, the IRS requires charitable nonprofit organizations to provide information about their governance. The IRS generally requires nonprofits to have a minimum of three board members. The IRS and several states require the board of directors to meet at least once a year, advisably 4 times a year.
Shortly after your new nonprofit has been incorporated, the first meeting of the board of directors should be held. Typically, items on the agenda for first meetings include:
- Adopting bylaws
- Drafting a conflict of interest policy
- Election of officers
- Opening a bank account
- Setting the accounting year
- Budgeting for the first year
- Adopting a format for safekeeping of minutes and other corporate records
Subsequently, the purpose of a board meeting is to ensure a nonprofit’s sustainability and growth, through collectively directing the nonprofit’s smooth functioning, while furthering its charitable cause. In other words, the purpose of board meetings is to make decisions, put forth policy, solve ongoing issues, make plans, and evaluate program service results.
The goal of a board is to decide what it must do to further a nonprofit’s cause and find out ways to improve on what it is already doing.
How to make the most of your board meetings
Board meetings should never be held just for the sake of it. It is a vital component to the success of any nonprofit; therefore, it is important that boards use board meetings in the most efficient way possible. There are several steps that can make meetings purposeful:
- Does Your Organization Need A Board Meeting? A nonprofit board handles governance while management handles the day to day running of a nonprofit organization. A management issue can simply be resolved through simple internal communication in lieu of convening a board meeting.
- Board members for nonprofits are usually volunteers as such might not be familiar with their role or responsibility. It is important that they are provided educational resources and encouragement to educate themselves. Several states like Ohio, Massachusetts, Tennessee, Oregon, Maryland, California and Illinois have legal statutes governing the responsibilities of board members. Board members, paid or unpaid, of nonprofit organizations have basic legal, fiduciary and policy responsibilities that they must comply with – hence the importance of an educated and informed board.
- Before convening a board meeting, it is important to make sure that all attendees are equipped with information to back their contributions. Attendees must have access to financial statements to provide context to discussions. Make sure that they receive these documents in a timely manner.
- Smooth and efficient running of the meeting. Backed by a clear and agreed-upon agenda, the task of a chairperson is to keep discussions on track. This can be accomplished by providing background information on any item on the agenda before tabling it for discussion. The chairperson must also encourage participation by all board members, and finally ensure that decisions made are clear with little room for misinterpretation.
- Minutes must capture issues under discussion, what was decided and actions to be taken. Recording of the minutes help to improve governance through clear actions and accountability. It is the responsibility of the entire board to review the minutes to ensure accuracy and omissions.
After every meeting, it is a good practice to reach out to all participants for feedback on the meeting and suggestions for the next meeting. This can be done through a questionnaire or a survey. You are much more likely to get forthcoming feedback if you inform participants that their feedback will remain anonymous.
Written by Franklin Asongwe