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The Complementary Model of Board Governance

A new book on NPO governance by Tom Abbott. B. Comm., CGA, CAE

A clear, cooperative way to govern and manage your not-for-profit organization by building an effective partnership between your volunteer board and staff.

Purpose of The Book

The purpose of the book is to describe a policy-based model of governance and management that can be readily adopted within not-for-profit organizations (NPOs). It comes complete with examples and templates of documents used in NPOs following the Complementary Model of Board Governance. The book will provide much needed assistance to volunteers and staff of small, mid-sized and large NPOs who are trying to cope in an environment of contracting resources and expanding demands for services.

Table of Contents

Chapter 1 A Resource for the Volunteer Director

Growth of volunteerism. Purpose of the book. Common NPO terminology.

Chapter 2 Governing and Managing – Understanding the Differences

Three essential functions that take place in every organization: planning, implementing, and monitoring. Board involvement in the corporate and not-for profit organization.

Chapter 3 The Ten Principles of Complementary Governance

What happens when an organization implements the Complementary Model.

Chapter 4 Operations under the Complementary Model

What the board does. What the CEO does. What committees do. Why there are separate manuals for board and staff. Roles of chair, secretary, and treasurer.

Chapter 5 Strategic Planning – It Begins Here

Strategic planning defined and explained. How the plan is created. The board’s role in the approval, implementation and monitoring of the plan. The role of staff.

Chapter 6 Setting the Ethical Standards – Codes of Conduct and Conflict of Interest Policy

Sample codes of conduct for the board and CEO and a conflict of interest policy.

Chapter 7 Monitoring Organizational Performance

Accountability of the board. Tools for monitoring performance. Sample self-evaluations for the board as a whole and for individual directors.

Chapter 8 Three Types of Committees and How to Use Them

Policy task forces, board committees, and CEO working committees. Sample terms of reference for each. Roles and reporting.

Chapter 9 Staff Manuals and Directors’ Manuals

Why there are two types of manuals and what goes into each.

Chapter 10 Implementing Governance Change

How does the organization get from here to there?

A Personal Story

Excerpt from the Introduction in the Book.

In 1999, I first started thinking and writing about the need for a new model of governance within the not-for-profit community. At the time, volunteer boards of directors had essentially two alternative models for governing and managing their not-for-profit organizations (NPOs).

The first was the “traditional” model of governance, which had been in use for decades within the NPO sector and had developed essentially on a trial and error basis. Under the guise of a “model,” the directors would assign themselves whatever role they thought workable in their NPO and assign to the executive director whatever role was necessary to support the work of the NPO’s board of directors and committees. If the assignment of roles did not work at any particular point in time for that particular group, then another, ad hoc variation would be tried. The only governance principle of the traditional model was: “The board sets policy and the staff implements policy.” There were three major deficiencies with this model:

  • There was no set of comprehensive, guiding principles underlying the model.
  • There was no agreement on a definition of the word “policy.”
  • The word “staff” was sometimes taken to mean the collective group of paid employees, and at other times taken to mean only the most senior paid staff person, (who from this point I will refer to as the chief executive officer, or CEO)

Experience showed that more accurately, the traditional model could be best described as the “muddling through model.”

The second form of governance that was being used by volunteer boards of directors was based upon the model commonly used by corporate or for-profit boards. This model had the benefit of being based upon a defined set of guiding principles; it articulated that the CEO was the one and only person meant by the word “staff”; and it defined the board’s role as governing through a set of policies developed by the board and which were expected to control the CEO’s actions.

While this model offered volunteer boards of directors significant benefits over the traditional model, there were a number of serious weaknesses inherent in it:

  • It allowed the board of directors to set policies in any area it wished – both governance policies and administrative policies.
  • It prohibited the board from having a meaningful role in the creation of the NPO’s strategic plan.
  • It could permit the board to delegate financial responsibility to the point where the board was incapable of meeting its fiduciary financial responsibilities.
  • It required a sizable staff structure.
  • It required the board to take a step back from the actual operations of the NPO.
  • It perpetuated a basically adversarial relationship between the board of directors and the CEO, whom the board sought to control through a set of “executive limitations.”

For these reasons, I concluded that a new governance model was required for the NPO sector. Consequently, I began working on the creation of a new model and in the spring of 2001, gave my first training seminar on the Complementary Model of Board Governance. The name for the model came from an article by Peter F. Drucker in which he described exactly the type of relationship I envisaged in the NPO. He wrote, essentially, that

Nonprofits waste uncounted hours debating who is superior and who is subordinate–the board or the executive officer. The answer is they must be colleagues. Each has a different part, but together they share the play. Their tasks are complementary. The two have to work as one team of equals.

Hence the name: the Complementary Model of Board Governance.

Since that first training session, literally hundreds of CEOs and volunteers have attended our seminars on the Complementary Model and implemented it within their own organizations. According to the findings of a major annual survey of NPOs in British Columbia, it is now the most common model used in the BC NPO sector.

I hope that, as you read the following pages, you will come to the conclusion, like so many others have, that this model is exactly suited to meet the needs of your NPO.

And as you read more about the model, it will become clear the fundamental proposition underlying the model is not new at all and is after all, quite simple:

The board establishes governance policies and monitors the organization’s performance. The chief executive officer implements the governance policies, manages the organization’s resources, and also monitors the organization’s performance. It’s as simple as that!

I am confident that the implementation of the Complementary Model of Board Governance will allow your board and CEO to work together as a team, to benefit from your NPO initiatives, and at the same time, accomplish the goal of improving the life experience of all your stakeholders.

Excerpt from the final Section of the Book

A Personal Story. How Parkinson’s Helped Frame This Book

In 2007, I was diagnosed with Parkinson’s disease. Both my neurologist and family doctor suggested I contact the Parkinson Society immediately and join a support group – which I did. What I learned from these contacts and my reading was how important it was for people with Parkinson’s to avoid anxiety and stress and how meditation could help enormously in reducing these problems – and, thereby, help cope with the disease and reduce its progression. I knew about meditation – but not much, so where to begin? I came across a book entitled Meditation for Dummies, by Stephan Bodian. A great book, I reasoned, since it was in its second edition and it came with a CD.

So I began reading. When I was about halfway through the 360-page “guidebook” I decided the topic was so important, and the book contained so much helpful information, I would read it cover-to-cover twice. Which I did. And then I turned back to the introduction. That’s where I found the three sentences, the 33 words, that began the real change I was seeking. This is what I read:

The truth is, you can learn the basics of meditation in five minutes. Just sit in a comfortable position, straighten your back, breathe deeply, and follow your breath. It’s as simple as that!

Thank you, Stephan Bodian! You had taken a profound, life-enhancing practice and encapsulated it in a mere 33 words. So now, after another deep breath, here again are my own 33 words about governance in the not-for-profit organization:

The board establishes governance policies and monitors the organization’s performance. The chief executive officer implements the governance policies, manages the organization’s resources, and also monitors the organization’s performance. It’s as simple as that!

T. C. Abbott

Vancouver BC.

October, 2011

About the author - Tom Abbott, B.Comm., CGA, CAE

Tom is an international management consultant, author, trainer and professional speaker based in Vancouver, British Columbia, Canada. He is President of Association Management Consultants Inc. (AMC) and since 1987 has worked with over 450 not-for-profit associations, charities, government and First Nations organizations in Canada and the US. Tom is a member of the Canadian Society of Association Executives (CSAE) and the American Society of Association Executives (ASAE). His areas of practice include governance design and implementation, executive staff recruitment, strategic planning, organizational and governance reviews and board training and facilitation. He is a frequent contributor to the CSAE's Association magazine and the ASAE’s Associations NOW magazine.

This is Tom’s second book. It will be available for purchase in December, 2011.

Please go to the AMC Bookstore for information about and to order his first book, A Practical Guide to Governing Your Volunteer Organization.

Copies of his DVD on The Complementary Model of Board Governance can also be ordered from the AMC Bookstore.

   
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