Why do nonprofits have boards, and what do boards do?
Most nonprofits are corporations, which means that they are legal entities distinct from the individuals who founded them. Like their for-profit counterparts, nonprofit corporations are governed by boards of directors with legal and ethical responsibilities that cannot be delegated.
The board’s responsibilities fall into the following broad categories:
- Legal & Fiduciary – The board is responsible for ensuring that the organization meets legal requirements and that it is operating in accordance with its mission. It is also responsible for protecting the organization’s assets.
- Oversight – The board is responsible for ensuring that the organization is well run. It moderates the power of management and has the power to hire and remove the chief executive, usually called the executive director or president.
- Fundraising – Board members raise money, make personal financial contributions, and serve as advocates for the organization to potential donors as a part of their responsibility to ensure the financial viability of the organization.
- Representation of Constituents and Viewpoints – Often, board members are chosen to bring the experience or perspective of the organization’s constituents to the board. By doing so, nonprofits better serve their communities.
- MANP’s searchable Answer Center features a section on Governance + Leadership with many resources about and for nonprofit boards.