Principle 15: Board Education and Communication

Principles for Good Governance and Ethical Practice

Principle 15: Board Education and Communication

Principle Statement

The board should establish an effective, systematic process for educating and communicating with board members to ensure that they are aware of their legal and ethical responsibilities, are knowledgeable about the programs and activities of the organization, and can carry out their oversight functions effectively.

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Introduction
Most people volunteer for boards because of a commitment to the mission of the organization
and the value of the organization’s work to society. Yet they may not have the training or information necessary to understand adequately their fiduciary responsibilities or common practices of boards of charitable organizations.
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  An effective board orientation process fills this need by detailing the broad oversight responsibilities of the board and the specific legal and ethical responsibilities of individual members. Members should be made aware of their personal liability for the board’s actions—or for its failure to take action—and of the protections available to them. All board members should receive oral and written instruction regarding the organization’s governing documents, finances, program activities, and governing policies and practices. Even members who have served on the boards of other organizations can benefit from a specific orientation to each organization for which they provide board service. Charitable organizations, if needed and if funds permit, should provide opportunities for board members to obtain special training or advice on legal and financial issues and responsibilities. It is also advisable for an attorney or insurance agent who is knowledgeable about board liability to explain the legal protections available to board members, as well as the options for insurance.
  
  The ongoing process of board education includes ensuring that members have received and reviewed sufficient information on the issues to be addressed at each board meeting. Agendas and background materials should be distributed far enough in advance of all board meetings so
  that all members can be expected to read and consider the issues prior to attending the meeting.
Core Concepts
- Every board member should have a clear job description.
- Thorough orientation provides new board members with an understanding of their fiduciary responsibilities and establishes expectations for board performance.
- Every board member should be familiar with the activities and purpose of the organization.
- Board development and education should be an ongoing process.
Legal and Compliance Issues
- To protect themselves against liability, board members should know their legal obligations.
- In most states, corporate statutes enumerate the legal responsibilities associated with board service.
Legal Background

There are no specific federal or state legal requirements regarding orientation and ongoing training of board members. Because the law requires board members to exercise reasonable care in making decisions on behalf of the organization, however, they must make an effort to obtain adequate information to inform their decisions.

(From The Principles for Good Governance and Ethical Practice: Reference Edition,
Published in 2007)
Discussion Points
These questions – from the Principles Workbook (PDF) – are intended to prompt discussion about the principle, assess the polices and practices of your organization, and encourage your organization to take steps to identify where improvements should be made.
1. How effectively do we orient new board members? Do we do it orally and in writing?
2. What steps have we taken to provide necessary training and information to our board members? How can we provide additional resources to our board members?
3. Have we adequately informed board members about the personal liability they have for the board’s actions and what protection is available to them?
4. Boards can learn by understanding leading practices in nonprofit board governance. Do our board members have a way of assessing their performance and practices against common practices for nonprofit boards?
5. Do our board members have the necessary information about programs and activities to make informed decisions? What can we do to improve this process?
6. Do board members individually take responsibility for coming to board meetings prepared to discuss issues on the agenda? Do we need to take action to improve this?