Nonprofit Leaders Have More Power Than They Think

A few weeks ago I wrote a post on a controversial topic, “How to Remove a Troublesome Board Member.” As I wrote in the post,

Of the many taboos in the nonprofit sector, the taboo against asking bad board members to resign is one of the most destructive. Instead of encouraging ineffective or meddling board members to move on, nonprofit leaders often show misplaced gratitude for those errant board members continuing to take up space.

Because it is such a taboo idea, I predictably received several emails, Tweets and comments in response to the post. The most thoughtful of which was from Tom Klaus, who wrote:

Like anyone who has ever led a nonprofit, I’ve wanted to make changes to my board to make everything run a lot better, and I can sympathize with the folks for whom your blog is intended. What I’d like to hear, though, are your thoughts on the legal and ethical aspects of a nonprofit leader making such changes to board.

In most states, the by-laws of a nonprofit organization establish the board of directors as the legal entity upon which the organization is established. The ED or CEO is typically not also a member of the board of directors, in my experience. Hence, there is a legal conundrum facing the leader. He or she may not have legal standing to make the changes to the board you are suggesting in your blog. Now, this is not to say, of course, that nonprofit leaders don’t try to do it anyway; only that doing so might provide the grounds for board members to significantly challenge and even release the nonprofit leader.

The ethical challenge this presents, I believe, is this: Is it ethical for a nonprofit leader to try to change the makeup of the group that hired her or him?

I think the most difficult governance challenge in a nonprofit organization is achieving the delicate balance between the power of the ED/CEO and the power of the Board of Directors. I’m sure we’ve both known organizations that have done this remarkably well, and they become high performing, heartily sustainable, and wildly successful in their work. I’m sure we’ve also both known organizations that just can’t seem to get the balance right.

One of my clients is like this latter. Over the years they have continued to fluctuate between too much power in the hands of the board and too much power in the hands of the ED/CEO. These are among the most unproductive times for them, of course. Just curious about your thinking on this.

Tom raises an excellent point. The nonprofit board of directors are and should be charged with the legal authority to hire and manage the nonprofit executive director. However, that does not mean that they are the only ones to possess the power to make changes in the leadership of the organization. It is important to understand that both board members and executive directors possess power but very different types of power.

In the 1950s two social psychologists, John French and Bertram Raven, defined a new way to think about the kinds of power people possess. They classified six bases of an individual’s social power:

1. Reward Power is based on a person’s ability to give rewards
2. Coercive Power is based on a person’s ability to give punishments
3. Referent Power is based on a person’s ability to make others want to model his/her behavior
4. Legitimate Power is based on a person’s official title or role
5. Expert Power is based on a person’s expertise
6. Informational Power is based on a person’s possession of specific content

Instead of the Legitimate Power that board members enjoy because of their legal title of “board member,” I was referring in my previous blog post to the Expert Power a nonprofit executive director can employ.

A nonprofit’s executive director possesses tremendous expertise in (to name a few):

• The mission, program delivery and results
• The organization’s strategy and goals
• The organization’s day-to-day work
• The skills, experience, networks needed on the board
• The resources (potential funding, strategic alliances) available to the organization

The most effective boards are those which are led by the Legitimate Power of the board chair and her committee chairs, paired with the Expert Power of the executive director. Because the reality is that as a group of volunteers who have many more pressing items on their to do list, a board of directors rarely functions at their best when left to their own devices.

Therefore the executive director can and should play a critical role in helping the board leadership to assemble the type of board that will help move the mission forward. This includes:

• Helping the board to analyze the board skills, experience and networks necessary to deliver on the strategic plan
• Identifying potential new recruits to fill those gaps
• Helping to structure the board to be most productive
• Meeting one-on-one with board members annually to determine where and how they can be most helpful to the mission
• Working with the board chair to hold board members accountable and ask them to resign when necessary

While the nonprofit executive director does not have Legitimate Power because, as Tom rightly points out, she serves at the behest of the board of directors, she can and should wield Expert Power to help assemble and manage a board that can be instrumental in the nonprofit achieving it’s mission and being sustainable.

To learn more about how to do that, download the 10 Traits of a Groundbreaking Board book.

Photo Credit: 24×7 Photo