If your not-for-profit’s board members don’t have the information they need to make decisions, the repercussions can be severe. Time can be wasted, voting may be delayed and your organization may be unable to act when it needs to. Worse, members might make decisions based on faulty information, negatively affecting your mission.
Here’s how to prevent such outcomes.
For Fiduciary Success
To properly fulfill their fiduciary duties, your board needs certain information. The first is financial. To help them fully understand your nonprofit’s position, provide it with copies of your Form 990. The board president or treasurer should review this document and approve it before it’s filed.
The board also must get the results of any audit you’ve conducted, salary information for key staff, and monthly and quarterly financial reports showing income and expenses. If your organization provides directors and officers insurance, provide proof to board members.
Share and Share Alike
Board members also need strategic information. This includes reports on your nonprofit’s work, such as how programs are being carried out and how they’re used, progress on event timelines, and membership statistics. If your organization collects information from the audience it serves, provide at least an executive summary of your findings to your board. Occasionally sharing with the board articles that relate to your nonprofit’s mission, locations or audiences also may be useful.
Sharing should go both ways. To help foster teamwork and commitment to the cause, ask that members provide brief bios and other relevant background information. Also publicly share thank-yous when board members make special efforts — whether those efforts are individual (such as securing an event sponsor) or group (performing due diligence on a new executive director).
To prevent members from wasting time reviewing irrelevant information, funnel all material through your executive director or another senior manager. Only executive-approved material should be provided to members. If you have questions about your board’s fiduciary role, please contact us.
To learn more about how PKF Texas serves not-for-profit organizations, visit www.PKFTexas.com/NotForProfit.