According to management consultant Will Phillips, "Recent research in the nonprofit arena at the University of Kansas and in the corporate sector has been reported in the Harvard Business Review. Both conclude that boards that assess themselves regularly perform better than those that do not. No other factor is as closely correlated in its presence with good governance or in its absence with poor performance" [emphasis added].

Get the board on board with self-assessment

Board chairs know that self-assessment is necessary, but sometimes even the most reasonable board members resist, seeing the process as just more busywork. If you need to persuade board members to approach an upcoming assessment positively, here are seven good reasons for conducting regular board performance audits you can present to them.

  • We want to maintain our accreditation  
    Regular board self-assessment is required for accreditation -- and for some people that's enough of a reason (and the only reason) to do it. The way they see it, self-assessment is one of the hoops you must jump through to comply with accreditation standards. However, mere compliance is the bare minimum for a board. Look a little deeper -- it's required for a reason. Why is this particular hoop there?

  • The public (including major donors) expects it 
    Regular board self-assessment is especially important in today's world of increased scrutiny. Daniel L. Kurtz, in Board Liability: Guide for Nonprofit Directors, states, "Although many organizations have been able to do good work with weak governance or management systems, there is a growing expectation that nonprofits be able to demonstrate accountability and effectiveness. The fallout from corporate (and nonprofit) scandals has resulted in federal and state government demands for greater nonprofit accountability and transparency, especially in governance."

Foundations and major donors, whether individuals or corporations, realize that board self-assessment is necessary -- most are involved in it in some way themselves. They want to know that an institution is meeting all the requirements for good governance before they invest significant amounts in that institution.

  • There's room for improvement 
    A good board assessment audit can direct light on problem areas, perhaps areas that board members weren't aware of, or would rather not investigate. It's awfully easy to keep doing things the same old way, even when they aren't working. And sometimes processes that used to work just fine are no longer working, yet no one really understands why. It may be that someone (or a group of someones) on the board is unhappy or uncomfortable, or feeling underutilized -- but the rest of the board either has no idea or doesn't know how to address the problem. And there may be people on the board with great ideas and useful skills that would benefit your institution, but they are quiet -- and the processes you have been using for conducting board business have not tapped into their strengths.

Dennis Hollinger is president of Evangelical Theological Seminary, which is in Myerstown, Pennsylvania, and is affiliated with the Evangelical Congregational Church. He says that the formal self-assessment their board completed recently "forced each board member to think about what a board does. This is helpful because we have a large board, 26 members, and individuals don't see all aspects of board work. The assessment helped them see the breadth of board responsibilities."

"One result of the self-assessment was that we were able to give data to chairs of subcommittees, with concrete suggestions about areas they could work toward improving," according to Bill Worley, board chair at Evangelical Theological Seminary. "The chair of our trustees affairs subcommittee took the data and worked hard on designing a chapel service at which new board members are welcomed and retiring members are recognized."

  • We're doing great work 
    Board assessment audits uncover strengths as well as weaknesses. You want to keep on doing what works, and the best way to do that is to be quite clear about what that is. After all, you don't want to accidentally stop doing the right stuff! In addition, looking at strengths can provide insight into how to turn the good into the best. Plus, everyone likes affirmation, and board assessment is an excellent means of providing it to individual members as well as to subcommittees and to the group as a whole.

  • Wow -- I never realized that 
    A good board self-assessment provides an opportunity for trustees to discover things that they didn't know -- and didn't even know that they didn't know. Sometimes a board needs greater clarity about roles and expectations, and needs to be more intentional about its own practices. You can set up conditions of continuous learning to educate board members, but you can't do this well unless you know what the board needs to learn. The result is not just smoother operations, but a much better use of everyone's time.

"During our board audit we learned that board members did not know much about our donors," says Dennis Hollinger. "As a result, we put together a presentation on demographic information about our donors and presented it at a board meeting. Members were astounded to see who our donors really are. This kind of information is extremely useful when they talk to individuals, churches, and businesses about giving to the school."

  • Big trouble
    A breach of trust within the board or the administration, serious conflict over a critical issue, financial freefall, development of two "parties" within the board -- anything as serious as these situations points to the need for formal, in-depth board evaluation, even if the most recent self-assessment occurred within the previous few years. When you are facing big challenges, it's more important than ever to step back and ask questions in a disciplined and thorough way. You need to structure the ensuing conversation carefully, fairly, and in a way that lets everyone know that his or her voice has been heard. Board self-assessment provides the tool to do this.

  • Board service is a vocation, and we want to fulfill this calling as faithfully as possible 
    Board self-assessment can and should direct everyone's attention to the primary reason for the existence of your institution, and to your mission. It should, in the end, strengthen the connection between board service and ministry. Everyone benefits from sharpening the focus on vocation.

What does the process look like?

First, it's important to keep in mind that there are two levels of board self-assessment. A less formal, less time-consuming type of assessment can and should be ongoing. There are various methods of doing this, but one way is as simple as asking each board member to fill out, on paper, the answer to one question at the end of each meeting.

Sample questions:  

"What do we need to discuss in more detail at the next meeting?"

"What is the most important problem facing the institution at this time, and how can the board address it?"

"Did you have an opportunity to contribute fully at this meeting?"

"Are you confident that you understand the board's policies on fundraising, and the role of board members in fundraising?"

"Would you say that your participation on this board is very rewarding? Why?"

If your board is facing a particularly difficult or confusing issue that requires extended discussion over many months, you might want to devise a short survey targeted specifically to that issue and ask each board member to respond. Tabulating the data and writing out comments for everyone to read at the next meeting is a good way to begin structuring the discussion.

Periodically, though, boards need to undergo a longer, more formal assessment of their performance. For most boards, a formal self-assessment should take place every three to five years. Extraordinary circumstances (a drastic change in finances, a steep decline or increase in enrollment) may make it necessary to conduct a self-assessment more frequently, in order to ensure that the board is equipped to deal with a changing situation.

Also, if you see indications that the board is struggling -- members are not engaged during meetings; people are trying to micromanage the institution; the board does not share a vision for the institution; you are having trouble recruiting new members; there is no healthy turnover on the board and people are not adhering to term limits -- a more formal board evaluation is needed.

One formal evaluation tool is the In Trust Board Performance Audit, the only self-assessment tool designed specifically for boards of theological schools. Drawing upon many years of experience with boards and seminary heads, as well as a thorough review of the literature on board governance, In Trust has identified activities that characterize a seminary board that is functioning well.

The audit takes two to three months from beginning to end. A key component of the audit is a survey that all board members are asked to complete. Most board members complete the survey online in about 30 minutes, but a paper-and-pencil version is available for people without Internet access. The survey comprises 60 questions covering six areas, and board leaders can add a question specific to their institution to each of the six areas:

  • Tending roots: mission, faith, and values 

  • Focusing forward: goals, priorities, and strategies 

  • Nurturing relationships: communication in and out of the institution 

  • Building teamwork: attention to systems and structures

  • Ensuring growth: board education and learning 

  • Honing skills: problem analysis and strategic thinking

Participating boards receive a detailed summary report complete with a statistical analysis of board member responses to each question, graphical presentations of the survey findings, and recommendations for a board development action plan. Board leaders are provided with a set of customized PowerPoint slides based on the summary report, and also receive a detailed outline, complete with talking points, to help in presenting the self-assessment findings at a board meeting or in a retreat setting.

In addition, participating schools receive a one-hour telephone consultation with an In Trust Governance Mentor to review the survey results and to plan the presentation of the findings to the full board. For an additional fee, boards can bring one of In Trust's Governance Mentors to campus for a one-day, in-depth working session based on the information collected through the self-assessment process.

"We scheduled a one-day board retreat at which the In Trust mentor, Rebekah Basinger, presented our assessment information," says Bill Worley of Evangelical. "It turned out to be a great teaching moment for us. Everyone saw the value of the survey information, and also the advantage of getting analysis of the data from someone who has seen many seminary boards at work. One of the results was that we decided to do a midterm update within the next two years to assess what kind of progress we are making in the areas that were identified as needing work. Rebekah is working with us to design a customized assessment instrument for this purpose."

Follow-up is essential

Presidents and chairs concur that board self-assessment is of real long-term value when people take the data and do something with it.

Dennis Hollinger recalls, "One of the things that really came out strongly at the Evangelical Seminary retreat is that board members want to be key players, involved in substantive issues. As a result, Bill and I changed the format of board meetings. At every meeting now we break into small groups to brainstorm on particular issues. This has worked incredibly well -- you just get a different response from a small group than from a large one."

"For example, we asked a small group to brainstorm about a particular debt the school was facing, and they came up with several solutions in informal discussion -- solutions that people were excited about, and that, as it turned out, worked."

"Another result of the self-assessment was creation of an ad hoc committee to work on strategic planning -- student recruitment and retention. It's a small group of administration and board members, and they are doing great work together."

Board self-assessment is an opportunity to take stock of where you are as well as where you need to be, and then to structure the conversation that gets a board moving in positive directions. It can speed up the process by which a board arrives at consensus on important matters -- an essential board skill.

A good board self-assessment will raise questions, shake things up, allow board members to hear each other loud and clear, and point the board in new directions. It's a vital component of good governance. Your institution, your students, and your board members deserve no less.

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