Why do boards have committees

Even though board committees require strong expertise, their work often overlaps with the work of other committees of the board. With an eye on efficiency and to prevent duplicity, many boards structure their committees with multi-committee directors. Directors who sit on several committees share helpful information, which alleviates issues with information segregation. Multi-committee directors tend to be outside directors who have a surplus of expertise in several areas.

The committee charter outlines the specific responsibilities and expectations of the committee. However, board chairs should have a good understanding of the decision-making process. Board chairs need to be good facilitators who are capable of keeping discussions on track and moving. A good meeting facilitator has experience with how to lead the board committee to complete its work. Committee members may be board directors or outside experts. The board president acts as an ex-officio member to all committees.

Committee members usually have the expertise that the committee requires. This allows for the best allocation of talent and ensures that work gets done. Each committee your board creates needs to have its own mission and reason for being. It should also have a defined set of responsibilities. If board members must serve on more than one committee, you may have too many committees. Most boards have members.

If you have more than 4 committees, your board members may feel that they must serve on multiple committees. Here is a list of typical nonprofit board committees that many organizations implement. Planning, creating other committees, creating an agenda for the group , and tackling other large-scale tasks are handled by this group.

These are permanent groups that meet regularly and only change with the arrival or departure of members from the board. These groups help monitor progress, make plans, and report to the main body on their specific subject areas. Standing committees often cover finance, marketing, communications, budgets, and more. Your board recruitment team is also likely a standing committee, sometimes part.

This group would be responsible for recruiting new members from the community, onboarding, and tracking terms for board members.

Some nonprofit board committees are only needed for part of the year or for specific events. If you do annual fundraisers, galas, volunteer gatherings or events and other one-time or yearly programs, a board committee may be assembled for each. At a nonprofit with development staff, the fundraising committee supports its work through donor appreciation activities, fundraising campaign support, corporate sponsorship or donation procurement, and so on. For a nonprofit without a development staff , the fundraising committee might do all the previously mentioned activities, as well as more tactical activities like annual campaigns and fundraising events.

The author argues that management must organize well to relate to such a committee and that someone should be clearly designated the chief strategic officer if not the CEO, then not the chief operating officer. He outlines the processes leading to management-board involvement in funding strategies not projects and in determining direction. This function usually receives minimal attention.

Two reasons explain this irony. First, management is often not organized or required to deal with strategic choices within its own ranks—and even less under the questioning of a board of directors. Second, the board of directors is not usually organized or able to shoulder its responsibility. The Commission officially, or its chairman personally, has settled on the virtues of having at least a majority of outside directors or even no insiders except the CEO , an audit committee made up entirely of outside directors, a nominating committee to recommend new directors, a chairman who is not the CEO, and other suggestions substantive and cosmetic.

All of the foregoing pronouncements seem designed to check management power; they are negative in nature. Little has been said to suggest that boards of directors should be organized to perform a positive role in examining the objectives and the progress of the company in achieving what it has set out to do. Most effective boards get their work done through committees that report to the full board.

Setting up a small group of directors chosen for their relevant expertise has proven to be an effective way to examine complex issues. Audit, compensation, and nominating committees—in order of their recent rise to prominence—overshadow the older executive committee whose function tended to become that of the entire board.

None of these newer committees is designed to examine resource allocation. The formation of a corporate objectives or strategy committee of the board is an important first move to involve the board in the strategy program for the future of the company.

Such a committee usually functions best if its members are outside, independent directors, and thus free of the emotional commitments which competing claimants for scarce resources inevitably develop. If a board sets up a strategy committee, management quickly feels the need to organize itself to relate to it. The following two steps seem very important to me:. A company must have a set of objectives.

What I am referring to here are the broad objectives of the company that really relate to compounding cash at a satisfactory rate. Thus I believe that the underlying general objective of any corporation must be to create value for both society and the corporation.

For the corporation, it must compound cash at a rate that satisfies the expectation of the stakeholders. Numbers must be assigned to objectives, if the latter are to mean anything. Because of inflation, absolute numbers are deceptive.

It becomes important to set goals also in terms of industry rankings and return on equity after inflation. And, of course, my premise here is that the CEO should set these objectives.

The primary duty of nonprofit organizations is to serve the public. Fundraising is one of their main activities, so most nonprofit organizations have fundraising committees that oversee efforts for fundraising events, securing grants and thanking donors. The finance committee is responsible for making sure financial reports are accurate. The governance and nominating committees establish priorities for board composition, plan for board director recruitment and succession, oversee board development and take the lead in performing board evaluations.

A communications committee handles all matters that relate to communicating with donors, stakeholders and others. This committee oversees newsletters, official communications, social media platforms, online presence and contact with the media. Smaller nonprofits sometimes combine the audit committee and the finance committee.

What a committee member does on a nonprofit board depends upon the type of committee on which they serve. Board directors can fill those needs either by serving on a committee or by fulfilling their duties and responsibilities as an appointed board member.

Directors and…. Writing Job Descriptions for Board Committees Board committees need to be clear on what the board expects the committee to accomplish. Forming a Nonprofit Committee The board chair usually has a pretty good idea of who the best person is to chair a particular committee and which members have the best qualifications and interest in serving on it.

A Governance Committee oversees director recruitment, orientation and board performance. Role and Responsibilities of Board Committees The main purpose of board committees is to place a greater amount of time and focus on a particular area of board business.