Robert F. Ashcraft
May 7, 2009
My Turn

Effective boards uphold ideals

Whether non-profits are relevant and effective organizations serving in the public interest is contingent upon a number of indicators. A leading indicator is an effective board of directors.

Boards consisting of competent and engaged leaders are a key to ensuring that fiduciary responsibilities are fulfilled and public trust is upheld. Examining what constitutes effective practice in the non-profit sector generally is incomplete without understanding the roles, relationships and requirements of board service.

Charities that exist for public-benefit purposes are only one type of non-profit allowed within IRS tax laws. Non-profit forms vary, so there is no one model of board governance to be applied to all non-profits, but there are legal and ethical responsibilities all boards should consider

ASU's Lodestar Center (www.asu.edu/copp/nonprofit) provides board-governance training for volunteers and staff of non-profits. The center's research, along with knowledge from BoardSource (www.boardsource.org), reveals several imperatives for standards of conduct for board members in carrying out essential responsibilities of the non-profits they serve.

In general, effective boards focus on developing and articulating the non-profit's mission by enhancing the organization's public awareness while ensuring that adequate resources are acquired to fulfill the mission. They select, support and carefully evaluate the CEO's performance. They provide diligent fiduciary oversight to ensure that proper financial controls are in place. Effective boards are active in planning and monitoring performance outcomes while ensuring accountability measures are implemented within legal standards and ethical norms. They assess their own performance and strive to recruit board members who have the competence and dedication to advance the organizational mission.

Effective board members demonstrate the duty of care when making decisions on behalf of the organization. They are stewards of the mission, assets and relationships of the organization they serve. They practice the duty of loyalty to the non-profit in giving their undivided attention to the best interests of the organization without regard for personal gain. They adhere to a duty of obedience that ensures congruence between their individual actions and faithfulness to the organization's mission.

There is no evidence to suggest that most non-profits generally, and charities specifically, don't adhere to the highest standards of legal and ethical practice. Ensuring the public trust is imperative, and effective boards are a key factor toward this goal.

Robert F. Ashcraft is director of Arizona State University's Lodestar Center for Philanthropy and Nonprofit Innovation and professor of non-profit studies in ASU's School of Community Resources and Development.