In this webinar, Kent Stroman will bring real life insights and practical tools to equip CEOs, Board members, and staff alike to move their charity forward collaboratively.

Full Transcript:

Steven: All right, Kent, I got 1:00 on the dot here in Eastern Time zone. Is it okay if I go ahead and kick us off officially?

Kent: Yeah, let’s do.

Steven: All right, cool. Well, welcome everyone, good afternoon if you’re on the East Coast, good morning if you’re on the West Coast or somewhere in between. Thanks for being here for today’s Bloomerang webinar, “Whose Job is It Anyway?” Boards, CEO, director of development? We’re going to find out. We’re going to tell you which role is best for each duty. We got a fun one for you guys today. My name is Steven Shattuck, and I’m the Chief Engagement Officer over here at Bloomerang, and I’ll be moderating today’s webinar as always.

And just a couple of housekeeping items, I just want to let you all know that we are recording this session, and I’ll be sending out the recording as well as the slides later on this afternoon. So if you have to leave early, or if you want to review the content or maybe share it with a colleague or a friend, don’t worry, I’ll get all that good stuff in your hand today. I promise you’ll get all that stuff.

And as you’re listening today please feel free to use the chat box right there on your webinar screen. We are going to try to save as much time as we can for Q&A. We love to make this interactive. We’ve got polls today. It’s going to be an interactive one, and it’s going to be a lot of fun, so don’t be shy about sending your questions and comments our way. Don’t sit on those hands. You can send them to your Twitter. I’ll keep an eye on Twitter as well.

And if you have any trouble with the audio by your computer speakers or through your computer speakers, I should say. We find that the audio by phone is usually a little bit better for these webinars, so if you have a phone nearby and if you don’t mind using it, if it won’t bother any coworkers and it won’t be uncomfortable for you, try to dial in by phone before you totally give up on it. There is a phone number you can dial in the email from ReadyTalk that went out around noon today. So give that a try before you totally give up on us.

If this is your first Bloomerang webinar, I just want to say an extra special welcome to you newbie. We do these webinars almost every single Thursday throughout the year. We literally only miss like two or three Thursdays. Great guests like Kent, totally educational presentations. One of our favorite things to do here. If you’re not familiar with Bloomerang, our core offering is donor management software, donor database. So if you are interested in that and you want to learn more about us, maybe you’re interested in switching sometime soon and just kind of want to see what we have to offer, check out our website. You can download a video demo. You can see the software in action. Don’t do that now because you guys are in for a real treat over the next hour or so, but maybe do that later on this afternoon if you were so inclined.

Like I said, we got a great session in store for you all today. One of my favorites is joining us, a great friend of Bloomerang. I think, Kent, this is maybe your fourth or fifth consecutive annual webinar with us. Kent Stroman is here.

Kent: No problem.

Steven: Hey, Kent, how’s it going? Thanks for being here.

Kent: It’s been great.

Steven: I’m just going to brag on you, super quick, I don’t want to take up a lot of time away from you because I’ve seen your slides. Got some great info for us, great advice. So if you guys don’t know Kent, he is literally America’s ASKING Coach, that’s kind of his thing. Super involved with board governance, also an expert on that. He’s a published author. He’s a frequent speaker. Like I said, he’s spoken at BloomCon. He speaks at conferences all over the place. If you see his name on a schedule, got to that session. It’s going to be fun. He might be wearing a big cowboy hat. You definitely will spot him from across the room. He has over 25 year of experience. He spent 25 years in higher education. Now he runs his own shop, Stroman & Associates where he does consulting for fundraising, board governance, strategic planning, leadership development, all the things that he’s going to talk about today.

He’s a CFRE. He is a Board Source-trained governance consultant. He is a Starkeys [SP] Foundation-approved for his retreats, for facilitating retreats. He’s also an adjunct consultant for the Oklahoma Center for Nonprofits. He’s calling in from beautiful Oklahoma today, so if you’re in Oklahoma, give us a shout out for sure. He had been named AFP’s Professional Master Trainer. He’s got that designation, tons of accolades, author of three books including “Asking about Asking,” which is on my bookshelf behind you right now. I got to get “Intentional Board” though. I need to order that one, Kent, but I cannot give you the time that you deserve for all your accolades, so I’m just going to let you regale us about role confusion, I think is the main topic today.

So Kent, I think he’s going to share his slides, so give it a second to get all that technical stuff going, but I will turn thing over to you, Kent, to give us all your great advice, so take it away my friend.

Kent: Well, thanks, Steven, it’s great to be with you again. I think the last time we were together in person was in February in Phoenix. What a great time that was. But today, our topic is “The Board . . . the CEO . . . the Staff . . . Whose Job is it Anyway?” And we’re going to have some fun with this and as, Steven, you mentioned the polls, I’m really eager to get people’s feedback, but as we get started there are really four big ideas we want to rollout today.

First of all, you mentioned role confusion. We’re going to give some tips on how to crush role confusion. Way too much of that in boardrooms around the world. And then big idea number two, choose the right tool for the job. We’re going to identify the wrong tool and the right tool and give you some tips on how to put the right person in the right place at the right time.

And then number three, we’re going to say deviations are distractions. And so when we’re tempted to deviate from best practices, I’m going to offer some tips on how to redirect and whether that’s the CEO redirecting the, or the vice person, some tips on redirection.

And then number four, celebrate the results. You know, a lot of times in our sector, we work hard, we achieve great things, and then we just move on to the next thing, but, you know, I think we deserve to take the time and take the energy. And sometimes even the cost to celebrate the results.

So with that, I want to jump right in, and we’re going to have some polls later but right now kind of an open-ended question, have you ever seen role confusion in the boardroom or maybe even outside the boardroom? And my question is what did it look like? So what are some symptoms or evidence of role confusion in your organization? And I’d love to hear some of those comments, Steven, as people respond in the chat box.

Steven: Yeah, we’ve got people saying, dear and headlights look, trouble juggling strategic versus operational work. That’s the really interesting one.

Kent: Oh, boy.

Steven: Kara says, “Chaos, no one leading.” Tamara, “The board directing the staff.” I think you’re going to talk a little bit about that.

Kent: Is that a problem?

Steven: I don’t know. [inaudible 00:07:20]

Kent: Yeah. So here’s the effect, and it’s interesting, I’m going to just share a few items that it sounds like that we’ve been in the same circles. So what’s the effect of role confusion in the boardroom? Chaos, I think it was Karen that mentioned that, yeah, chaos, and it’s for everybody. Disenfranchised board members, have you seen that in your board where we’ve got people that, you know, they were once passionate, highly involved and engaged and we start seeing them maybe distance themselves a little bit? It’s because of disenfranchisement.

How about undermined CEO? We’ve got a CEO whose role and purpose is being undermined as a result of this role confusion. And then there’s absenteeism, people stop showing up. Disengagement throughout, and then the other, and some of those other comments I’m wondering, Steven, any other comments that have showed up that maybe fall outside these first five themes?

Steven: Yeah, we’ve got governance versus operational. A task lingers because no one knows who is supposed to do it. Micromanaging which is maybe a little bit about, maybe a little related to undermine but maybe a little bit different

Kent: Yeah, all of the above. So just to kind of lay a little bit of the conceptual foundation, I want to start by sharing an organizational hierarchy. And so all of us operate under, I was going to say cloud, but under the framework of federal law. Right? So federal laws have an impact, but beneath that then we have state laws that affect each of our organizations, and then under the state law we have our county, city, or municipal law, then there are the organizational bylaws, board polices, administrative policies, departmental policies, and what’s left? Oh it’s me, my own personal policies, practices, and preferences for that matter.

So, again, just to give a bit of a framework. Those first three levels, federal, state, city, county, and municipal, that’s the governmental environment, and in our organizations we operate under that stuff. It exists, and we don’t directly change it. I mean, we may lobby or advocate for changes in these areas, but ultimately we don’t establish that. Beneath that we’ve got the organizations bylaws and then policies that are established by the board, and those are purview of the board. So the board sets the bylaws, the board establishes policies that guide board work and then policies that are over, kind of, overarching for the entire organization.

Under that threshold, then we have this administrative policies and departmental policies, which you establish in one form or another by staff and that maybe that’s from a CEO on down. And then this last category, that’s all about me, me, me, personal polices, practices, and like I said, preferences. And so I think it’s helpful for us to kind of get a sense of where in the hierarchy each of these things fall so that we know what supersedes what. And as you can see as it relates to me, I basically have no standing in the organization. I’m a participant, not an insignificant one, but what is important to me individually falls underneath all of these different elements. And so I think it’s helpful for us whether we’re at the staff level, the CEO, or executive C-Suite, or as a board member, etc. to know where does my role fall beneath and where does it fall above.

So this hierarchy I think is just an important point of reference and actually that flows out of the book that, Steven, you referenced, “The Intentional Board.” And a lot of the concepts that we’re going to talk about today can be found, and this is my latest book, actually it came out in August 2017. So we’re still in the inaugural year. So anyhow, a lot of things we’re going to talk about are embellished, addressed in greater depth in the book.

So with that, let’s go right to big idea number one and that’s the crush role confusion. Well, just to get us started, let’s go to our first poll, quick poll A, and the question is “Whose job is it to recruit new board members?” Answer (a) is the CEO or Executive Director. Is it the job of the board chair? Is it this founder’s spouse, the board as a whole, or a departing board member?

Now, Steven, you’ve got the poll. You want to just walk everybody through the mechanics.

Steven: Yeah, here we go. So let’s see your choice here. So now they’re coming in.

Kent: So people just click that on the screen?

Steven: Yeah.

Kent: That’s a pretty cool technology.

Steven: Yeah. Looks like most people are saying the board as a whole. That is the overwhelming winner.

Kent: Interesting. Well, and so we’ll take just a few more moments for anybody to click on the poll, and just so you know, we’ll be taking these responses and incorporating that into some of the research that we’re doing nationwide. But what I’m going to do is let me just switch back to the question on the screen. So whose job is it to recruit new board members? First of all, let me identify who usually does it and it’s not his or her job and that is (a), oftentimes the expectation in the boardroom is that the board will be, the board members will be selected, recruited, and maybe even replaced by the CEO or the executive director, and let me just say that is not best practice. Item number (c), it’s kind of a decoy. I don’t know if anybody responded to that. And sometimes we’ll see the idea that as a board member it’s my job to name my replacement that’s item (e), but recruiting new board members is the responsibility of the entire board.

And one of the things that I would just emphasize, I’ve come to the belief that the most important thing that any board does is decide who joins the board, and so item (d) is our answer, the board as a whole. So what does this have to do with the whole idea of crushing role confusion? Well, I want to give you a graphic that I think helps illustrate it. And in any kind of organization, whether it’s charitable, corporate, or otherwise, these five roles exist in every organization. Now, by function you can see them one, two, three, four, five, to govern, to, lead, to manage, to micromanage, and to execute. Somebody used the term earlier, micromanage.

So every one of these roles is important, and I would say essential in every kind of organization but not at every level in the organization. So we’ve identified the five functions. Now, let’s give some examples of the activity. So to govern consists of establishing the mission, setting the direction, adopting policy, and then assessing organizational performance against the policy. That’s the activity that goes with governance. To lead has to do to delegate and to direct. Manage is the overseeing process. Micromanage is to count, control, or to deal with the minutia. And then execution has to do with implementing, implementing what it’s implementing, the mission.

And so the next question is “Who do we assign these functions to?” So on the right-hand you’ll see that governance belong to the board. Leadership belongs to the CEO. Management goes with the supervisors. Micromanagement is assigned to administrative staff. And then execution, this is our frontline carrying out the mission on a day in day out basis. Now that goes with our program staff. So you can see that every one of these five functions are essential, but you’ll notice we’ve highlighted the first role or first function in green. And I want to break this down to give clarity both inside and outside the boardroom. And so what we say is that everything is either governance or not governance.

Well, how profound is that? Well, what I want to say, and I’m just going to go back for a moment. Everything in the organization if it’s governance, it belongs to the board and it doesn’t belong anywhere else. And if it’s not governance, it does belong elsewhere and it doesn’t belong in the boardroom. So just to come back and emphasize, we say everything is either governance or not governance.

And so with that in mind, we’re able to, I’ll just offer this as a really practical exercise to use in the boardroom, and that is at the beginning of every board meeting, ideally even before that but as a new exercise for an existing board at the beginning of the meeting, look at the agenda and ask the board collectively to look at every item on the agenda and ask ourselves what’s the essential function that this agenda item relates to. And if it’s essentially about governance, in other words, articulating the mission, setting the direction, establishing organization-wide policy, or assessment of performance against policy, it belongs to the board.

One other thing which we’re going to touch on a little bit later, also belongs to the board, but apart from that, in my experience, many of the things on board agendas don’t even belong to the board. And one of the best things we can do is to get it off the board agenda so that the board can be freed to deal with matters of governance and be freed from dealing with matters that are operational.

I’m going to pause just for a moment, Steven, to see if there might be any comments or questions related to this first big idea and that’s to crush role confusion by identifying what governance is and what governance is not. Any comments or questions in the chat box so far?

Steven: Yeah. A couple, Ken here is wondering if the roles differ if you have a working board, so maybe your comments on working boards. And Jennifer is commenting, it gets hard to separate the board from the staff when you have a super small staff. So maybe the small shops where maybe the board is more involved what advice would you have for those folks?

Kent: Yeah. Well, so first of all, I want to say there’s this common theme around, “Well, our board is different,” and oftentimes this term “working board” is associated with that. And here’s what I want to suggest regardless of the purpose of the organization, the size, the age, either every board is a working board, or there is no such things as working board. How is that? And so here’s what will help you, and that is to distinguish between the work of the board and the work of members of the board, and the fact that many members of the board function in multiple roles. And so I’m just going to go back for a moment to the organizational roles.

A board has no authority except when it’s meeting in session. And a board member has no authority except to cast a vote in a duly called meeting of the board. And so do we have members of the boards who do things on behalf of the organization outside the boardroom? The answer is yes. So, you know, one of the common ways that we want board members to be involved is to assist in the fund raising, right? Well, a board can’t raise money. Board members can contribute money and board members can ask others to make a gift. But when, as a board member, when I’m asking someone else to make a gift, I’m not in a governance role, actually, that’s in a management or even in an execution role and in that capacity I’m working in a staff capacity. It’s volunteer staff, you know, staff . . . I can be in staff function whether I’m paid or not, I’m in a volunteer staff capacity and in that I am reportable or accountable to the development director or the vice president for advancement.

And so one of the things that can be really helpful inside the boardroom is to identify all the different hats that we wear as individuals but then take all those hats off and set them aside during a board meeting and everybody puts on the same hat, it’s the governance hat. And so I think really that, so back to the small organization, we just need it to help people know when they’re acting as a member of the board in a governing role, and that’s when we’re in a duly called meeting, and then when the meeting is adjourned, the only involvement that’s left is non-governance roles, the important roles. And so a board member has absolutely no basis to boss around a staff member.

If the board wants to take action to direct, let’s say the program managers or program officers take this action or that action, the only way that can happen is with a motion, a second, and more yes votes than no, and then that action which has been taken by the board is filtered back into implementation through the CEO. So anyhow, let this breakdown be helpful to identify the various roles and to eliminate the confusion. And so with that, actually, I just realized that these next couple of slides are out of order, so I’m just going to make a quick comment on them. And then we’re going to jump to the next poll.

One of the themes that emerge as I was writing “The Intentional Board” was the “17 Laws of the Intentional Board” and we certainly don’t have time to go through all of them today, but I’m going to make reference to one or two of them as we go along. And Steven, who knows maybe an opportunity when we could come back sometime and address some a couple of the other laws of the intentional board.

But what I want to point out right now is law number 11, and this is the law of unnatural selection, and so we want to talk about taking the path of most resistance and that is to recruit up. And so as we get into our second big idea, I’m going to come back and refer again to the law of unnatural selection and how as members of the board in the recruitment process we can recruit up.

But before we do that, I want us to go to quick poll B and here are the questions, “Whose job is it to hire new staff members?” So is it the job of the board, the options is: the Board chair, the CEO or Executive Director? Is the job of the HR Director? Is it for the boards as a whole, or does it belong to the departing staff member? And so with that I’m going to refer back, Steven, if you’ll walk us through the poll taking process.

Steven: Here we go. They’re coming in. It looks like CEO or ED is the early winner here in about two-thirds of the vote with the other third going to HR Director. No one says board chair. I think that’s good.

Kent: What? There’s the board chair. No, but it’s not the board chair. Okay, well, as people continue to respond to that, let’s see, the members of the staff, so there’s one aspect of this that’s just a little bit tricky to as I look at it right now. If the staff member who’s being hired is the chief executive officer, then the answer is different, right? Because the hiring of the CEO belongs to the board as a whole, but apart from that one person, every other member of the staff is the responsibility to be hired outside the boardroom, and so let’s just go back to here, back to the slide that were looking at earlier, and the main thing we want to say is that it is not the job of the board to hire staff other than the CEO.

I don’t know what organization does call on departing staff members to select their replacement, but there’s really no authority there for a former staff member to engage an employee. How that is arranged between the function of the HR Director and the CEO is going to vary from one organization to the next. So the key point that I would make is that it’s not the responsibility of the board. And so this really leads us into the big idea number two, and that is to choose the right tool for the job. And so whether it’s selecting board members, hiring staff, we want to make sure it’s the right person in the right role and the right process for getting the right person in the right role.

Now, with that, I just want to share three qualifications, and I’m going to come back and kind of fill this in a moment later but first of all there are personal qualifications. And so for everybody who’s in the webinar, you’ll think about the qualification that you bring to the job. In a lot of ways who you are as a person represents some qualifies that makes you successful in what you’re doing. So personal qualification, I’m going to identify that as PQ1. Next, there are professional qualifications and so, and I’ll use my own example, I often jokingly refer to myself as a recovering accountant. So my background and my history is finance. I used to work in accounting. In fact, I used to be an accounting professor.

Well, my personal qualification for being an accountant is I have a personal predisposition to understanding things in numeric ways and kind of from a financial background. I also have a professional qualification and that comes from my education, from certifications that I received, and then from experience, on the job experience. So I have professional qualifications and I’m calling that PQ2. But then there’s the positional, now my position oftentimes gives me a qualification, so now I’m not just employed in the area of finance but now let’s say I am the Chief Fiscal Officer, so that gives me a positional qualification, but notice I’m calling this PD. And I want to point out how sometimes our positions, which gives us the qualification for certain things, sometimes it also presents a disqualification, a positional disqualification.

So let’s take this idea to the boardroom. I always say the right tool for the job, so here’s maybe kind of a neutral thing. We’ve got a, let’s say we’ve got a CEO in an organization that is very skilled professionally in group meeting facilitation. So the CEO has lots of experience and lots of training in facilitating group meetings. And let’s say that she is also personally qualified in the same space. She is just a gregarious person. She has a commanding personality, and so her personal and professional qualifications make her an ideal facilitator for group meetings, and now let’s think about a board retreat for the organization of which she is the CEO. She is positionally disqualified, and why is that that this doesn’t undermine her ability, her preparation, but it just says in order for her to be effective as CEO, it’s going to be a misfit.

And so think about personal qualifications, professional qualifications, but be alert to positional disqualifications. Now I’m going to use that as a little bit of a lead in to our next poll and the question, here is whose job is it to solicit contributions from board members? Okay? Solicit contributions from board members and it’s on behalf of the organization for whom the members are on the board, okay? XYZ charity, XYX board members whose job is to solicit contributions, (a) the Development Director, (b) the Board chair, (c) the CEO or Executive Director, (d) Founder’s spouse, it showed up again, and then (e) any other name. So with that, Steven, let’s go to . . . whoops, I clicked the wrong button, and sorry, do that again.

So we’ve got the responses here, whose job is it to solicit contributions from boards members? And I see about 25% are saying Development Director, Board chair, CEO, nobody thinks it’s the founder’s spouse, and nobody says other. Okay, do let’s make sure there’s time for people to respond.

Steven: I think we accidentally started it, so people may have to chat in their answers on this one.

Kent: Okay, I apologize.

Steven:That’s okay.

Kent:I think I clicked the wrong button, sorry about that. So as the responses are coming in, there’s something that’s really interesting. I see it changed. No, it didn’t. It’s still the same. So let me just say this, the most common practice is that the board relegates this activity to the staff whether it’s CEO, the development director, whatever. And this is definitely an upside down but very common approach. And the essence of it is think about the board has the authority to hire one person, the CEO. That one person has the authority to hire directly or indirectly everybody else in your organization. And what we mustn’t do is to pout that person in a position of going to the one who hired them and basically asking them for a contribution to pay my salary. Okay?

So soliciting contributions from board members belongs to the board. Now, how that’s organized, I’m going to tell you that professionally, my preference would fall under the other. And that is the chair of the governance committee or the chair of the fundraising or resource development committee. Here’s why I don’t want it to be the board chair, is because of the authority structure, it almost creates an imposition where there can be the perception that authority is being welded to exercise something that’s really a voluntary act. And so what I like to do is to see that the, I’m going to run with the chairman of the governance committee, I like for that person to take the lead on soliciting contributions and that he or she is able to lead on that by having already received, spontaneously received the gift or pledge from the board chair. So the board chair is leading by example, but he is not leaning with an example.

So this will be an example of that earlier idea where the board chair is personally qualified to raise contributions, to ask for contributions from fellow board members. Also professionally qualified but positionally disqualified. So with that, let’s jump back to the screen, and I want to go back to what we were talking about earlier. One of the things that when we talk about big idea number two, choose the right tool for the job, we want to make sure to equip board members to do the work of the board, and the board can lead the organization, whether it’s in the area of generosity or otherwise, by caring for itself first.

Another form of leadership that belongs to the board is that of evaluation. And somebody asked me one time, you know, what do you think about the board’s involvement in evaluating the performance of the CEO? Well, that’s an essential function of governance, but in order to fully have the authority necessary to do so, the board should lead by having first done its own performance evaluation of the board as a whole and the individual members of the board. So, again, it’s important for us to recognize the five organizational roles and to have the board govern and have the not governance done at other levels within the organization.

So with that, let’s go quickly to big idea number three and that is deviations are distractions, lets redirect. So when there is, let’s say that you’re in a board meeting, as a board member, and something is on the agenda that has to do with the board voting to determine what color of carpet is going in the new facility. It’s an important decision, but if we look back at the previous slide we say, what is there about that that has to do with governance, and I’m going to say nothing. And so by definition, we’re able to redirect that to the responsibility of the CEO under the staff that reports to the CEO. It’s not governance.

On the other hand, let’s say we’ve got some spontaneous item that’s brought up that is governance. So somebody makes the motion in the board meeting, “I move that we adopt a new policy to do X, Y, or Z.” Here’s an example or redirection there, “I want to have the board chair direct that to the committee of the board that is tasked with dealing with the, in that case, program matters.” So that each item can get the consideration that it deserves in the appropriate committee and then recommendations come from that board committee to the board for action.

So with the big idea number three, let’s just take a quick poll. Whose job is it to decide which fundraising events to conduct? Is it the job of the Development Director, the Board chair, the Board as a whole, the CEO, or some other? And with that, let’s go to the poll, Steven. Did I do the wrong thing again?

Steven: Here we go. No, you’re good. They’re coming in now.

Kent: Okey-doke. Whose job is it to decide which fundraising events we . . . our theme is the Board, the CEO, the staff, whose job is it anyway?

Steven: I think Development Director is running away with it.

Kent: Oh, yeah? So as people are having a few moments to respond, and Steven, when it’s time to put the results on the screen, I’ll leave that to you, but just as a little bit of background here, I can’t tell you how often I’ve had people come to me usually development directors or CEOs with this comment, “Kent, you’ve got to come and tell our board that they don’t need to establish another fundraising event.” Well, I have to tell you I have predisposition to agree with the sentiment, but it’s interesting that this is in the boardroom, because even though oftentimes we’ve asked board members to make these decisions, that’s the wrong place for the decision.

What we want to do, you know, what should the board’s involvement be in fundraising? Well, the board ought to be establishing the budget, both the revenue expectations and the expense allotment for the fundraising activity, but to decide which activities, who’s going to be the [RA 00:42:24] chair, what the ticket price, and even if we’re going to use fundraising events or use events to raise money, that really is outside the purview of the board.

So Steven, how about the results? Can you post that in graphic form?

Steven: Yeah. Let me see here. Here we go [inaudible 00:42:54] see them now?

Kent: Okay. Yeah, we’ve really got a run away with the green stripe down the Development Director. Definitely, board chair, no way. Board as a whole, nope, that really isn’t a governance matter. The CEO or Executive Director and I would say ultimately under the adviser or in conjunction with the advice of the Development Director for sure. Other, I’m curious we’ve got seven responses there. I don’t know if those are identified by name, I’d be curious to know which other, because there may be an example of how we could apply that.

So I’m just going to jump back real quick to the screen share and again, we said big idea number three, deviation is a distraction, and so let’s redirect, let’s make sure that matters of operational or administrative functions are referred outside the boardroom rather than left inside the boardroom. So here’s my reminder, everything in the world, yes, everything is either governance or not governance. If it’s governance, confine it to the boardroom. If it’s not governance, then we want to drive it out of the boardroom.

And so we’ve got just a few minutes left. I’m going to go to big idea number four and save a little bit time for Q&A, and that is to celebrate the results. Let’s help people feel good about doing good. It seems like that we’re really great in our culture at finding ways for people to feel bad about doing bad. Sometimes we even take that to an extreme and come up with ways to make people feel bad about doing good. But there are so many good things that are happening in our world, in our culture, in our organizations, in our boardroom. Let’s make sure that in the boardroom, we have a culture of celebration and that we celebrate the board doing the things that the board should do.

Find somebody in board who can go out of the way to catch board members and the board as a whole doing what they do well and celebrate that, and so for example, you know, we’ve talked about board giving. I want to celebrate the generosity of board members in the context of the board. So when we reach a 100% of board member participation in contributions, let’s celebrate that. Don’t hide it. When the board giving outdoes what the board giving amount was in the previous year, let’s celebrate that. When the board takes a proper approach to recruiting board members, let’s celebrate that. Big idea number four, celebrate the results.

And so just to go back for a recap, these four big ideas: Crush role confusion, choose the right tool for the job, deviations are distractions so let’s redirect, and then celebrate the results.

And so I want to just share before we go to Q&A a quick insight and that is here’s my advice to the CEOs, and I hope there are a number of CEOs that are on the webinar today. And that is, CEOs don’t do the work of the board, don’t do the work for the board, but do the work through the board. By contrast to the board and members of the board, don’t do the work of the CEO, don’t do the work for the CEO, do the work through the CEO. And so CEOs here’s my request, lead. It’s the job of the CEO to lead the organization. CEOs do that, and board, your job is to govern. So board, do govern. Board, don’t supplant the leadership. CEOs do lead, don’t try to do the work of governance.

And with that, Steven, let’s take a moment if there are any questions, I’d be happy to respond to those while we still have just a few minutes before we go into wrap up mode.

Steven: Yeah. We got a lot here and if you haven’t asked a question, feel free to send it now so that we can probably spend maybe the next seven or eight minutes on them. Kent, a couple of people asked on our second poll, “What if it is the CEO or the ED who is departing, who then would be in charge of doing the hiring in that case?”

Kent: Okay. Yeah, great question. So I’m going to just go back to the . . . there is one employee of the organization that the board has the responsibility to recruit, select, engage, evaluate, and release, and that is the CEO. And so how the board goes about doing that, so let’s even take it to whether it’s a small, you know, mom and pop organization, or whether it’s the largest university or healthcare system in the land. The responsibility lies with the board. How they go about doing that, whether they engage a search firm or whether it’s a committee of the board that makes a recommendation. We may seek the advice of the outgoing CEO, we may seek the advice of the executive team, we may receive input from the faculty or from the physicians, but ultimately, the responsibility for the process and for the result lies squarely with the board.

Steven: Okay, makes sense. Here’s one on a similar vein. This question comes in, I won’t use the name, but the person asking is currently the highest ranking staff member at a small shop but they don’t have a CEO, so she’s the highest ranking but not the CEO, they don’t have a CEO because that person transitioned out. What advice would you have for her for managing the board? Sounds like she’s struggling with them maybe micromanaging her in that situation.

Kent: Okay. Yeah, great question. Man, we could do a whole session on that topic alone, Steven, but I think the situation there highlights the importance of someone being designated to function as a CEO. And I would say that by default, even if there hasn’t been a decision made that she’s functioning in that role, and so back to the micromanagement, it’s the job of the board to manage the board, and the board can only do that in session and the board can only give direction to the staff through the CEO. And so the board member has opinions, which are interesting but frankly, irrelevant unless it’s represented in the action by the board.

And like we said before, the only way the board can express its will is for a member of the board to make a motion, another member of the board to second it, and then for there to be more yes votes than there are no votes, and then that is codified, if you would, in the minutes. And the message may be delivered by the secretary of the boards, by the chairman of the board, or whatever, but it’s being presented, not as a personal preference or a personal directive, but rather as a directive that’s coming from the board, not the board chair, not the board secretary. They maybe the messenger, but they are not the origin of the message.

Steven: Makes sense. Kent, how do you feel about the CEO having an equal vote with the other board members?

Kent: Okay, great question. I see that often. That is inherently problematic and here’s why. There are lots of reasons, but I’ll give you the simplest one. And this is another one where we can spend a whole session on, but that is this, go back to conflict of interest. And every organization should have a conflict of interest policy, and in many, if not most matters that the board is going to vote on, the chief executive officer by position is going to be in the conflicted position. And as a result, if we have a good conflict of interest policy and if we’re faithful to it, it’s going to push the CEO out of the boardroom because of the conflict of interest, and so now, we’re in the situation where the person who should have something to say can’t even be present for the conversation. And there are a whole lot of other reasons, but to me, that’s the main one.

The other question I want to ask is what does it accomplish? What’s the benefit to the organization or the benefit to the CEO of having a vote on the board? And essentially, there aren’t any or there aren’t many benefits of a vote because it’s one vote. And there are many detriments. In fact, last year I completed a feasibility study for an organization that had that situation, the CEO is a voting member of the board. And I had a number of funders, formal funders that said, “We wouldn’t consider making a contribution because of that particular arrangement.” So whether it’s for practical reasons, for financial reasons, for conflict of interest reasons, it’s just not a good idea.

Steven: Makes sense. Here’s the inverse to that situation. Let’s say the CEO steps down and a board member becomes an interim CEO. Number one, would you think that’s a good idea? And if so, or in addition to I should say, is that person still a board member, or do they sort of relinquish their role as a board member in that case? It’s a fun one.

Kent: Yeah. That’s a problematic situation. I’m not going to say it’s categorically a bad idea. However, when the organization makes the decision to appoint an interim CEO from the members of the board, it’s essential that it define the ramifications of that choice. And so at the very least, I mean, if I was advising the organization this is a great idea, let’s have, you know, Jane Doe is going to step into an interim role. If we do that, I would recommend that at the very least that we clarify that during her term as executive director, that while she is technically a member of the board, she will function as if she were no longer a member of the board, and we’ll ask her to agree in accepting this interim role to relinquish her authority to vote during that period of time.

Steven: Okay.

Kent: Again, for some of the reasons we mentioned earlier. Here’s the practical results of it. Either she then is selected to become the CEO and loses her board position permanently because of that, or somebody else is selected to become CEO and inevitably for any variety of reasons, she ends up rotating off of the board in an untimely fashion. And so the observations I would make is that oftentimes the person that we select for that it’s whether intended to be so or not, it tends to turn into an exit from the board. Not necessarily a bad thing but it’s just I would say this is one of the things we want to go into with our eyes wide open both as members of the board and as the new interim CEO. And so with that, shall we go into wrap up mode?

Steven: Yeah, let’s do it. I know there’s a lot that we didn’t get to, but Kent, are you willing to take some questions by email perhaps?

Kent: Yeah. And more questions, in fact, I’m going to ask this other thing. My one question about boards is, if people have a question, I wish we had had time for this, but I’d be happy to receive those by email. I know you’re going to share that as we wrap up. But if you have a question that maybe lies entirely outside these topics, feel free to forward those to me. And as we wrap up, I just want to ask everybody to identify for yourself what is today’s most important points. And then to make application of it and this really does make it personal. But what needs to be done in your circumstances, your organization, what needs to be done, whose going to do it, and when. And on that second question, I would just say the answer is it’s you. The responsibility lies with you. And so if there are ways that we can be helpful, as an outside resource, we do lots of work in the area of board retreats and executive coaching and governance consulting. We’d would be happy to come alongside.

And so I want to say a great big thank you to everybody for their attention. I do want to wish you every success as you build your own intentional board. And with that, Steven, it’s back to you.

Steven: Okay. Well, thanks, Kent. This is awesome. [inaudible 00:58:29] and I could probably talking about this all day, and we would if we didn’t have the time limit, but email Kent your questions if we didn’t get them because there’s a lot of good ones in here that are juicy. And I think you might actually have fun helping people through these problems, Kent, based on what I know about you. So reach out to him for sure.

We’re going to get you guys the slides and the recording for sure so be on the lookout for that from me. I’ll get that out to you in the next couple of hours or so, so you’ll get that in your inbox. And we’ve got some great webinars coming out for sure. Next week, it’s a fun one. A topic we haven’t covered very often “Corporate Matching Gifts,” so if you are interested in maybe setting up a matching gift program or maybe you have one and it’s not exactly lighting the world on fire, tune in. It’s going to be a good one. We’ve got an expert in that, Hannah Silvers is going to talk all about it. Great session topic for sure, totally free, totally educational, 1:00 p.m. Eastern next Thursday. I’d love to see you there. If not, there’s other webinars you can choose from. Lots of other topics. We got those scheduled out even into next January already. I can’t believe it. It’s true, 2019 will be here before we know it.

So check that out. Hopefully, we’ll see you again next week or some other Thursday. So we’ll call it a day there. Like I said, look for an email from me, I’ll get you all the goodies and hopefully, we’ll see you next week, so have a good rest of your Thursday. Have a good safe weekend and we’ll talk to you again soon.

Kristen Hay

Kristen Hay

Marketing Manager at Bloomerang
Kristen Hay is the Marketing Manager at Bloomerang. From 2018 - 2020, she served as the Director of Communications for the Public Relations Society of America's local Hoosier chapter. Prior to that she served on several different committees and in committee chair roles.