Nonprofit Board Calendar: Schedule of Key Agenda Items
Michele Berger & Gene Takagi
The board of directors is ultimately responsible for everything a nonprofit corporation does - what activities it conducts, how it raises and spends its money, what direction it's headed, and whether it's complying with all of its legal and ethical obligations. With all that responsibility, a board must take care in figuring out how to best spend its time at a limited number of board meetings that take place in a year. Reviewing various aspects of the organization is a necessary task but such reviews should regularly be accompanied by board actions in response to the information. A calendar of agenda items developed by, and shared with the board, in advance of the coming year is a great way to help make sure nothing critical gets missed.
Sample Calendar*
January
Executive performance review discussion
Financial performance review
March
Program performance review
Review of Form 990
May (Annual Meeting)
Elections of directors and officers
Legal compliance review
July
Mission review
Board and committee composition review
September
Risk management review
Fundraising review
November
Budget approval
Program direction approval
* This sample board calendar is offered for illustration purposes. Boards should determine for themselves the appropriate items to include (additional items might concern membership, the annual event, and communications strategies) and the timing for discussing such items. And there should always be room to consider urgent and important matters that may have not made it on the calendar even if calendar items have to be deferred until later.
Tasks
Review of the executive. The board typically delegates management of the organization to the executive and should therefore assess how the executive is performing. An annual performance review is an opportunity for a two-way discussion between the board (represented by one or two directors) and the executive. Board discussions about the performance of the executive and the review process should begin soon after the end of the year.
Review of financials. Of course, oversight of the organization's financials is a core responsibility. The directors should be performing a review regularly, as may be appropriate under the circumstances, but we recommend a formal review by the full board at the start of the new year to inform whether plans for the current year should be adjusted. If the organization has its financials audited, the board should also be prepared to timely review and approve the audit, including the audited financials.
Review of programs. It's important not to limit oversight to the nonprofit's financials. Nonprofits exist to advance a charitable purpose, and it's the board's duty to provide oversight over how their organizations are doing that. Such oversight should go beyond merely listening to programmatic updates from the staff. The board should monitor key performance metrics (and cause the staff to develop and refine appropriate metrics, as appropriate), and make modifications to the programs and plans, as necessary.
Review of Form 990. Most tax-exempt organizations other than churches must file some version of the Form 990 with the IRS annually. The filing must take place by the 15th day of the 5th month after the fiscal year is over (May 15 for calendar year filers). The board, or an authorized committee of the board, should review the Form 990 before submission to the IRS. More and more, the Form serves not only as a compliance document sent to a regulatory agency, but also as a marketing piece that is viewed by potential funders, donors, partners, and reporters. The board should ensure that it strategically sends accurate information and the desired message. A policy for reviewing the Form 990 is highly recommended.
Elections of directors and officers. The board should ensure that elections (including re-elections) of directors and officers are being held consistent with the requirements stated in the bylaws.
Review of legal compliance. With staff input, and the assistance of legal counsel, as appropriate, the board should review the organization’s past legal issues and identify and assess its current and future issues. The board should consider employment practices, internal policy compliance, required licenses and permits, nonprofit and 501(c)(3) compliance (e.g., prohibited private inurement/benefit, excess benefit transactions, self-dealing, excessive lobbying, political intervention), facilities and real property, intellectual property, and contract compliance. The board may also want from the executive a checklist showing that all required filings have been or will be completed and that the organization’s status with the relevant government authorities are all in good standing.
Review of mission. The board should review the organization’s mission statement against its activities. First, the board must ensure that the mission statement and activities are consistent with each other and with the stated purpose statement in the organization's governing documents. If the mission or activities are not consistent with the specific purpose statement in the articles of incorporation, the board should confer with an attorney immediately. Additionally, the board should consider from time to time whether the mission should be modified. Not all changes to the mission reflect improper mission-drift.
Board and committee composition. The board should review its own composition and performance and determine, based in part on such review, its recruitment, training/development, meeting, oversight, policy-development (including regarding conflicts of interest), and planning strategies. The board should also examine its committee structures. Is each committee active and useful? Are the right people on the committees? Is the board exercising sufficient oversight over the committees? And if the answer to any of those questions is "no" - the board must determine how it will manage those issues.
Review of risk management issues. With staff input, the board should identify and discuss the organization’s risk areas, ensure the development and implementation of appropriate risk management policies (including proper training of staff and volunteers), and review the adequacy of the organization’s insurance coverage. Sometimes, the most notable risks are not associated with legal compliance but with the organization's reputation. Consider having a few directors act as devil's advocates coming up with "what can go wrong" scenarios (but regularly change those individuals assigned with such role).
Review of fundraising. The board should be informed of the organization's fundraising, including any new plans and major prospects. The board should also consider its own role in fundraising and how individual directors might develop key contacts and allies for the organization. If the organization does not have a gift acceptance policy but accepts gifts other than cash and publicly traded stock, the board should adopt an appropriate gift acceptance policy to mitigate the possibility of acquiring an undesirable gift (e.g., real property with hazardous waste, art with very burdensome and expensive maintenance costs) or a gift subject to a problematic restriction.
Budget approval. The board should carefully review and approve a budget for the upcoming year. A budget is an important planning tool that encompasses an organization’s programs, mission, values, and strategic plan.
Program direction approval. The board should strategically review and amend, as necessary, the organization’s programmatic plans. Continually operating all running programs without any changes will not be in the best interests of the organization when the environment is continually changing. The board should provide leadership and demonstrate courage in continually improving or reshaping the organization's programs, including through investing in their programs' leaders.
Additional Thoughts
In addition to the tasks described above, the board should schedule time at each meeting to discuss what they believe to be the most important matters facing the organization and how the organization should adapt, if at all, in response to those matters. Generative questions may be asked to stimulate the creation of new ways of looking at things and innovative solutions. Such questions may include explorations about several alternative ways in which the organization might respond to a changing environment, develop its leadership, optimize its board composition, identify ways to collaborate, change its delivery of services, serve more beneficiaries, and otherwise further its mission.
Meeting a director’s legal or fiduciary duties is a much greater task than simply staying out of personal trouble. It’s about protecting, overseeing, and directing the organization with reasonable care to effectively and efficiently advance its mission. Preserving the status quo is often not the most valuable strategy for doing so. Accordingly, reserving time to discuss various options, including those not easily accessible, is an essential part of fulfilling the board's ultimate responsibility.