Commercial and Nonprofit Boards Or Directors
Almost all businesses and nonprofits have boards or directors who are the governing bodies that create plans for their organizations, give recognition to those who the individuals who carry out those plans, and oversee the executive staff. Many nonprofits also have advisory boards that provide guidance or advice to the director and executive.
Boards of both types have a few similarities in their path to success. Healthy boards require careful recruitment, training and orientation of new members. They also require a close partnership between staff and board.
The primary function for both types of boards is establishing strategic goals and making sure that management’s actions coincide with the goals. Both types of boards need to ensure that operating plans exist and that financial resources are secured and allocated in ways that can achieve long-term and short-term goals of the organization; and policies promote ethical and legal compliance.
Nonprofit boards are usually larger than those for profit, as they have to represent all stakeholders who are interested in the institution. This usually results in college boards, for instance having 70 or more members, including teachers, parents staff, alumni and faculty are on the board along with wealthy individuals.
Boards for both non-profit and for-profit organizations generally meet at least once a year to discuss their operations and make important decisions. Both kinds of boards have their own governing documents, which comprise articles of incorporation and bylaws, as well as descriptions of the roles and responsibilities of committees, directors, and the board. The two types of boards formulate policies in writing which include guidelines for director autonomy, conflicts of interests, codes of conduct and indemnification.