board chair
30 Aug
  • By Malcolm Boyd
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The Relationship between Board Chair and CEO in an NPO

The Board Chair and Chief Executive Partnership

The partnership of the board chair and chief executive provides a structure for accomplishing the tasks of the organisation.

 

Governance and management complement and support each other — focused together on mission through different perspectives and actions. The partnership itself is critical in providing a communications HQ for sharing information, addressing issues and planning next steps appropriate to the individual and collective responsibilities.

 

Role of the Board Chair

An NPO board chair serves as the leader of the organisation’s board of directors, which has ultimate governance responsibility for the NPO. The board holds the final say on the overall strategy of the organisation, as well as appointing the CEO. The board also controls the budget of the organisation. As the leader of the board, the chair carries immense responsibility.

 

Role of the CEO

The CEO (aka executive director) is the top administrator of the organisation. The CEO appointed by, and reporting to, the board of directors, implements strategy. The CEO manages the staff and day-to-day operations, and is responsible for making tactical decisions required for meeting the goals set by the board.

 

Personal relationship

The personal relationship between the CEO and the board chair will depend on the personalities of the individuals occupying those roles as well as the nature of the organisation. Some nonprofits tend to appoint business leaders as chair while appointing program specialists as CEOs.

 

For example, a sports organisation  where the chair is a businessperson, may appoint a former coach or accomplished professional football player as CEO. This can lead to tense interpersonal relationships due to different worldviews. Regardless of the background of the CEO and the board chair, when the two roles clash it often presents problems for the organisation that must be rectified by the board, ensuring smooth operation of the nonprofit.

 

Framework for the Board Chair – CEO relationship

Be sure the CEO and board chair share strategic issues with each other—negatives as well as positives. A failure by either the chair or CEO to share information (such as a tightening of their bank’s credit policy) can have serious fiscal consequences.

 

It’s critical the CEO conduct orientation sessions with a new chair, explaining the challenges facing the NPO. The CEO can help the chair keep the board focused on strategic issues, whether programmatic or financial.

 

The board has only one major employment decision to make – to recruit and appoint the CEO. It’s usually a long and exhausting process. But once it’s completed, the employment of all other staff personnel is the responsibility of the CEO and the CEO’s management team. For senior positions, most CEOs ask their chairs and a few other board members to meet with senior candidates, but the ultimate responsibility remains with the CEO. The board also has a responsibility to ensure a CEO succession plan is in place. The CEO can assist in this.

 

The chair and CEO is tasked with establishing and leading meeting agendas. Together the two partners must assure sufficient meeting time to discuss and resolve strategic issues.

 

Comments from an international NPO CEO:

  • Chemistry between the CEO and Board Chair is hugely important.
  • The Board Chair’s must willingly seek to truly understand the organisation as best as he/she can ie. it’s corporate philosophy and DNA.
  • It’s vital the CEO/Chair have open and agreed upon communication lines and times to speak frankly.
  • It’s crucial the Board Chair listens to the observations of the CEO with regard to other Board members ie agenda, personal bias, different cultural perspective and so on.
  • It’s important both parties seek to keep each other fully ‘in the loop’ on issues that pertain to the organisation and its functionality.
  • That the CEO has freedom to confidentially share with the Chair how he/she is actually doing/feeling is also of importance.

 

Comments from an NPO Board Chair:

  • Trust is fundamental as in any relationship, therefore an investment at the initial stage is critical.
  • Respect of each person’s role is important so as to avoid overstepping the boundaries.
  • There has to be openness in the communication which will be enhanced by the level of trust – monthly one on one meetings are very useful.
  • The ability to speak truth and not be judgmental.
  • The board effectiveness hinges on a good relationship between the chairperson and the CEO.

 

Comments from a seasoned NPO governance practitioner:

  • A good understanding of the different roles coming with the different positions is important. It’s generally recognised that the Chair and CEO should not be the same person – this is because they have different mandates/roles.

 

  • King IV recommends that: “The CEO of the organisation should not also be the chair of the governing body, and the retired CEO should not become the chair of the governing body until three complete years have passed after the end of the CEO’s tenure.”

 

  • This is because the CEO’s function is dedicated towards operational execution. The Chair’s role is towards leading “the governing body in the objective and effective discharge of its governance and role and responsibilities.”
  • A proper understanding of their respective roles will also help in appreciating their different contributions.
  • Also, the chairperson forms part of the employer, whilst the CEO is an employee – again different roles. The one appointed under the constitution – the other appointed in terms of an employment contract.
  • Other issues like trust and respect are important, but the framework of the relationship is very important – and will facilitate a relationship that is based upon trust, respect and other qualities.

 

In conclusion, when considering joining a NPO as the CEO or Board Chair, perform additional due diligence, taking into account the information above.

Read more insightful and informative posts on how to run your NPO as a topnotch organisation. 

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Malcolm Boyd
Founder and Managing Partner of Third Sector Insights.

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