Legally, boards are required to ensure that an organization succeeds in its mission and has a well-thought-out strategic plan and doesn’t get into legal or financial issues. However, the method by which boards get involved in the exercise of their duties can differ dramatically and is highly dependent on the circumstances of the organization.

Boards often make the mistake of becoming too involved with operational issues that should be left to management or they are unclear about their legal responsibilities for the decisions and actions taken by an organization. This confusion is usually caused by not keeping up with the changing demands on boards, or the unanticipated problems like financial crises and resignations of staff. This is typically solved by taking the time to discuss the challenges facing directors and providing directors with easy-to-read materials and an orientation.

Another common error occurs when the board makes the decision to delegate too much power and not review the matters it has delegated. (Except for the tiniest NPOs). In this situation the board is unable to perform its assessment function and cannot determine whether the operational activities contribute to the satisfactory performance of the company.

The board should also come up with a governance system that includes how it will communicate with the general manager or chief executive officer. This includes the decision-making process for the frequency of board meetings, how members will be elected and removed, and the manner in which decisions are made. The board also needs to develop information systems that offer valid information about its past and future performance to support its decision-making.

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