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Most nonprofits and businesses have directors or boards who are the governing bodies that make plans for organizations, assign recognition to the individuals who carry out those plans and supervise the executive staff. Many nonprofits also have advisory boards that provide advice or guidance to the board and executive director.
Boards of nonprofit and commercial organizations share some commonalities along the road to success. Healthy boards require careful recruitment, training and orientation of new members. They also require a strong partnership between the board and staff.
Both kinds of boards play the responsibility of setting goals for strategic development and ensuring the management’s actions meet these goals. Both types of boards must ensure that operating plans are in place; that financial resources are secured and allocated in ways that achieve near- and long-term goals of the organization; and policies promote ethical and legal compliance.
Non-profit boards typically have more members than those for profit, as they must represent all parties that are involved in the institution. The boards of independent colleges typically include 70 or more people comprising wealthy parents, wealthy individuals teachers, alumni, and other parents.
Boards for both non-profit and for-profit organizations generally meet at least once a year to discuss their operations and take important decisions. They also have governing documents, which include bylaws, articles of incorporation and descriptions of the roles and responsibility of the board as well as committees and directors. The boards of both types will formulate written policies, such as those on director independence and conflicts of interests as well as codes of conduct, confidentiality and indemnification.
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