How Should Nonprofits Conduct Board Evaluations?

04/13/2015 02:56 pm ET | Updated Jun 13, 2015

Recent (2015) data from BoardSource show that only about 52 percent of boards have had "formal, written self-assessment of board performance in the last three years." With the rapid turnover of directors that nonprofit boards traditionally experience, this seems inexcusable. As a "veteran" nonprofit director, following is what I think can be done to improve the situation.

Evaluate Board Processes

• Value of board materials: board book delivery time prior to meetings, material clarity, meeting notices, etc. Are board books delivered a week ahead of meetings?
• Stakeholder Relations: Board interactions with various nonprofit stakeholders groups, especially staff. To what extent do directors interact with key stakeholders? Are records available of these interactions to make certain they take place? Identify the directors that are most adept at building these relationships?
• Willingness to evaluate qualitative outcomes: To what extent are data developed that go beyond typical records such as accounting statements and membership records? Are more difficult data developed, such as brand image and impact on the community? Is hearsay evidence discarded in making major decisions?
• Composition of the board in regard to racial diversity, gender, skills, age, board experiences, etc.: Does the organization have a diversity policy? Do current board members have sufficient prior board experiences in order to act as models for new members without prior board experience?

Action plans: including a yearly review of board minutes that obligates the board to review accomplishments. (Lack of some actions may lead to board and/or organization liabilities.) Does the plan provide evidence of a robust CEO & organizational evaluation? Does the organization coordinate field accreditation processes with action plans?

Director Evaluation Approaches

As boards evolve, they can use:
• individual self-evaluations by each director;
• evaluating the board as a whole;
• peer-to-peer assessment,
• an independent third party to conduct the process and to advise on confidentially and to present a report.

Coming from an academic background, in which the peer-to-peer process is strongly ingrained, I suggest a peer-to-peer blind review (source of individual comments not revealed to others) administered by an outside expert to advise on process and develop the report. The report needs to be supported by an assessment of how the board has succeeded in completing the required processes listed above.

The last venue for evaluation has cost limitations in the nonprofit environment, but with the others at least each director will obtain an understanding of how others perceive his or her contributions, if all are willing to be constructive in their suggestions for individual change. In an ideal world, the board chair then can ask some who are not contributing to resign from the board.

The major cultural limitation to assessment is that nonprofit board members tend to be restrained from being too critical, sometimes allowing a report to have positive biases to maintain harmony. This hinders the board chair with the most difficult job of counseling a disruptive director, who makes a substantial financial contribution, to change behavior.

Summary: Nonprofit boards need to have self-evaluations more frequently than for-profit boards because directors' tenures are shorter and board "personality" can change quickly. At the very least, a board member or small committee can review past board minutes every year to determine what has been promised to be accomplished and compare the information with what has been accomplished.