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  • Pat Libby

Nonprofit Margaritaville! The Bylaws Party Continues

Updated: Nov 19, 2021

In the previous blog we pulled out the guacamole and chips, poured ourselves a few margaritas, and started the party by talking through:

1. What size board do we need to successfully steward and advance our work?

It was such a fun time that we added some spicy bean dip and decided to tackle some other important questions:

2. What kind of term limits make sense?

3. How should our board members be selected and removed?

4. Should we have voting members?

5. Do we want the chief staff person to be a voting or non-voting member of the board?

Here’s some food for thought to kick off the discussion.

2. What kind of term limits make sense?

Yes, Virginia, term limits for nonprofit boards really do make sense. They make sense because they bring fresh energy, ideas, perspectives, talents and connections.

I see many boards that are scared of term limits because they are worried that they won’t find other people who are as dedicated as they are to the cause. Which makes me wonder: If it’s such an important cause, how come the board has so little confidence that other people will care about it as much as they do?

Term limits don’t have to mean complete banishment!

You might, for instance, allow a board member to serve up to two or three consecutive terms (of whatever length you decide makes sense) before taking a break from governing (for perhaps a term).

You can then ask these people if they would like to serve on a committee in between terms or volunteer in another capacity.

Ideally, you want to set things up so that a portion of your board is turning over at any given time.

That will ensure continuity and new blood.

3. How are the board members selected and removed?

First, let’s tackle the sticky topic of removing board members. Many nonprofit bylaws contain a provision that says something to the effect that a board member can be removed if that person misses 3 meetings in a row (or something similar).

The problem is that usually when that happens, when a board member consistently fails to show up at meetings, the organization takes no action.

Taking no action has consequences. Consequences like not having a quorum (a quorum being the number of people needed in order to take a vote on a matter). Consequences like other people feeling free to miss meetings because…why not, no one expects me to be at every meeting?

A board cannot govern without governors! And a good board cannot govern without people who take their legal responsibilities seriously.

Even a wonderful board member who is seriously ill and requires on-going medical treatment, should take a leave of absence for the good of the organization.

I encourage nonprofits to write meeting participation rules into their bylaws and to grow a pair of… avocados when it comes to removing board members who, for whatever reason, cannot attend regular meetings.

Another hot topic is the process by which your nonprofit identifies and nominates board members.

Think carefully about who has this responsibility, for example, will it be a nominating committee that is separate from the executive committee that presents its slate to the board or membership for approval? If you have members of your corporation, are they allowed to nominate people to the board? If so, how does that process work?

Which brings us to…

4. Should we have members?

And, if so, what role do they play in the organization? Are they removed from any type of governance function (like members of a museum) or do they play an active role in helping to elect the board and officers of the organization? There is no wrong answer here however, you want to be sure that whatever you decide reflects the culture and values you want to create for your nonprofit.

For example, if your nonprofit is dedicated to serving the interests of a particular group of people, it will probably want to have members of that group represented as part of its governance. That is where the magic of governance and mission connect!

5. Do we want the chief staff person to be a voting or non-voting member of the board?

In some states, it is legally permissible and encouraged for the chief executive to be an “ex-officio” officer of the corporation – that is, a non-voting board member. In other states, such as California (where I live), this isn’t allowed; here, someone must be either voting or non-voting. Look at the laws of your state (you can Google the state charitable division to find these) and talk among yourselves about what you think is best for your organization.

By this time I’ve drained my margarita and we’ve still only gotten to a few of the key things to consider when reviewing bylaws. Don’t worry though: you can keep the party going with other fun and interesting things to talk about as you read through your bylaws. Party on!

*Please note: this is a blog, not a comprehensive list of everything that you’ll need to consider when reviewing your bylaws. I hope the information I’ve provided is helpful but keep in mind, that what I’ve written does not constitute legal advice.

Pat Libby Consulting is a San Diego firm that offers nonprofit consulting and philanthropy consulting services, including reimagining boards to unlock radical transformation.

Contact me for information on my services, and let's get your organization's governance structure on track.

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