Let’s
start with something that sounds completely backwards. Imagine a business where
the people legally responsible for the organization’s success spend four hours
a month thinking about it. Meanwhile, the person who spends forty-plus hours a
week running it has less authority than they do. Most people would look at that
arrangement and immediately start asking questions. In the nonprofit world, we
call it governance.
To
be clear, this isn’t an attack on nonprofit boards. I’ve worked with some
exceptional board members over the years—smart, generous, mission-driven people
who care deeply about their organizations and communities. Most nonprofit
boards are filled with people who genuinely want to help. The problem isn’t
usually the people. The problem is that we’ve built a system that asks ordinary
volunteers to perform an extraordinarily difficult job and then act surprised
when tensions emerge.
At
the center of almost every nonprofit sits a curious arrangement: The Executive
Director carries operational responsibility. The Board of Directors holds
ultimate authority. And between those two realities lies one of the most
persistent sources of nonprofit dysfunction. Not because anyone is malicious. Not
because anyone is incompetent. Because
the structure itself creates tensions that are almost inevitable.
The Authority Problem
In the for-profit world, authority
and accountability are generally aligned. A CEO answers to a board of
directors, but those board members typically have a direct financial stake in
the organization’s success. If the company performs well, they benefit. If it
struggles, they feel the consequences. Nonprofits work differently. Board
members are unpaid volunteers. They don’t own the organization. There are no
stock options, dividends, or equity stakes. The organization’s success or
failure doesn’t directly affect their financial well-being. That doesn’t make
board members less committed. Many care deeply. But it does mean one of the
primary accountability mechanisms that exists in the corporate world is absent.
The structure becomes even stranger when board members volunteer for
organizational activities. A board member may help at a fundraising event,
serve on a project team, or volunteer for a program. In those moments, they
often fall under the supervision of the same staff they govern. One minute
they’re the boss. The next they’re a volunteer reporting to staff. The
authority relationship literally flips depending on the context. Organizations
that fail to define these boundaries clearly often find themselves dealing with
confusion, frustration, and conflict that can be remarkably difficult to
untangle.
The Information Problem
One of the least discussed
realities of nonprofit governance is that the board and the staff experience
the organization in fundamentally different ways. The Executive Director lives
inside the organization every day. The board visits periodically. An ED sees
every personnel issue, every budget challenge, every grant deadline, every
community relationship, every operational headache, and every small decision
that eventually becomes a big one. The board sees reports. This isn’t a
criticism. It’s simply the reality of volunteer governance.
A typical board member may spend a
few hours each month attending meetings, reading reports, and participating in
committee work. The Executive Director may spend 160 hours or more each month
immersed in the organization’s operations. That creates an unavoidable
imbalance: the people with the most authority often have the least direct access
to information, while the people with the most information often have less authority.
That’s a difficult structure to manage even when everyone involved is acting in
good faith. And most of the time, they are.
The Recruitment Problem
Nonprofits rarely recruit board
members because they’re governance experts. They recruit them because they’re
passionate. Or generous. Or influential. Or connected. Or respected in the
community. Those are all valuable qualities. They’re just not the same thing as
governance expertise. A person can be an outstanding donor, volunteer, business
owner, attorney, accountant, physician, artist, or community leader and still
know very little about nonprofit operations. Yet once elected to the board,
they’re expected to provide strategic oversight for an organization they may
only interact with a few hours each month. That’s a remarkably difficult
assignment when you stop and think about it. The result is a governing body
that is often asked to oversee work it doesn’t fully understand—not because
board members lack intelligence, but because they lack exposure. Passion for a
mission and expertise in governance are not the same thing. Unfortunately,
nonprofit boards often assume they are.
The Impossible Executive
Director Position
The Executive
Director occupies one of the most unusual roles in the professional world. They are expected
to be the organization’s operational expert. They hire and supervise staff. They
manage finances. They oversee programs. They maintain community relationships. They
implement strategy. They support the board. They educate the board. And they
are evaluated by the board. In many cases, the person being supervised is also
the person with the deepest understanding of how the organization actually functions. That dynamic can
work beautifully when trust exists. It can become deeply frustrating when it
doesn’t. The healthiest board-ED relationships eventually evolve into something
that feels less like a traditional boss-employee relationship and more like a
partnership built on mutual respect, clear communication, and shared commitment
to the mission. But getting there
takes work.
The Working Board Trap
Most nonprofits begin with a
working board. A small group of founders and volunteers does everything. They
write grants. Plan events. Answer phones. Balance budgets. Make decisions. At
that stage, the board isn’t just governing the organization. The board is the
organization. As nonprofits grow and professional staff are hired, the board’s
role is supposed to evolve. The doing gets handed off. The board transitions
toward governance: setting strategic direction, ensuring financial health,
evaluating the Executive Director, and serving as a steward of the mission. This
transition is one of the most important milestones in a nonprofit’s
development. It’s also one of the most frequently mishandled.
People who helped build an
organization often struggle to let go of operational control. Their identity is
tied to the work. Their sense of ownership is understandable. Sometimes this
evolves into what’s commonly called Founder Syndrome—a situation in which founders
or long-time leaders continue operating as though the organization belongs to
them, even after it has grown beyond that stage. The result is often a board
that remains heavily involved in day-to-day operations while neglecting the
broader strategic responsibilities only a governing board can fulfill. Ironically,
over-involvement in the small stuff often coexists with under-engagement in the
things that matter most: long-term sustainability, succession planning,
strategic direction, and organizational resilience.
A Note About the Rules
Here’s something that surprises
many people. Much of what we think of as nonprofit board governance isn’t
actually required by law. Governance scholar and nonprofit thought leader Vu Le
has written extensively about this reality. Many practices that feel fixed and
immutable are actually traditions that have accumulated over time rather than
legal requirements. The current model feels permanent because it is familiar. Not
necessarily because it is the only way. That’s an important distinction. It
means we can examine the system honestly. We can ask whether certain practices
still serve organizations well. And we can be open to innovation
rather than assuming every governance challenge is simply the price of
admission.
What Healthy Governance
Actually Looks Like
Critiquing the structure doesn’t
mean boards aren’t important. Far from it. At Hamilton Players, I've been fortunate to
work with board members who care deeply about the organization and the
community we serve. Like most nonprofits, we've experienced many of the
tensions described above. We've also seen firsthand that when boards and staff
invest in communication, trust, and shared understanding, those same tensions
can become strengths. Great boards are transformational. The best board members
understand that their role is not to run the organization. It is to govern it. Likewise, great staff understand that their
role is not to govern the organization. It is to operate it. The goal of
nonprofit governance isn't for the board to think like staff or for staff to
think like the board. The goal is for each group to contribute the perspective
the other lacks. Staff bring operational expertise, institutional knowledge,
and day-to-day experience. Boards bring outside perspective, community
connections, accountability, and long-term stewardship.
They ask
thoughtful questions.
They maintain
accountability.
They provide
perspective.
They safeguard
the mission.
They help ensure
that today’s urgent challenges don’t eclipse tomorrow’s long-term needs.
Most importantly,
they understand that governance is not about having all the answers.
It’s about asking
good questions and being willing to learn. The strongest boards I’ve
encountered aren’t the ones filled with people who believe they’re experts.They’re the ones
filled with people who are curious enough to become informed. When each side
respects the value of the other's role, the partnership becomes far more
effective than either could be alone.
The Good News
The structure has real flaws. But the
structure isn’t destiny. Organizations that navigate governance well tend to
share a few common traits. They invest in board education. They provide
meaningful onboarding. They define roles clearly. They actively manage the
transition from working board to governing board. They foster open
communication between board and staff. And they cultivate a culture of
humility, curiosity, and continuous learning. There’s a saying that goes,
“Culture eats structure for breakfast.” Bylaws matter. Policies matter.
Committee structures matter. But none of them matter as much as the culture in
which they operate. A board built on trust, curiosity, humility, and mutual
respect can succeed despite imperfect structures. A board lacking those
qualities can struggle even with impeccable governance documents. Ultimately,
the difference between a board that helps an organization thrive and one that
unintentionally holds it back often comes down to a simple question: Are the
people involved more committed to the mission than they are to their own
authority? When the answer is yes, remarkable things can happen.
The nonprofit sector has become increasingly
willing to have honest conversations about governance in recent years, and
that’s encouraging. The challenges are real. The tensions are real. But so are
the opportunities for improvement. The structure may be imperfect by design. Fortunately,
it’s still run by people. And people, given the right tools, the right mindset,
and a willingness to learn, are capable of doing far better than the design
itself might predict.