What Information Should Board Prospects Receive?

Summary:

Enough to help them understand the organization and be sure of a 'fit' between their interests and the mission. Plus (and this is the tough part), enough to support due diligence about the organization's work.

Answer:

Someone asked in Nonprofit (see http://www.rain.org/mailman/listinfo/nonprofit):
"Suppose a potential board
member, being actively recruited by the board, asked to see a year's worth
of minutes, saying she needed to know more about an organization she wanted
to join. Would this be appropriate and advisable, or not? And who would make
such a decision -- I assume it would be the board as a whole, not just the
nominating committee."

Donald A. Griesmann, Esq., a Consultant with Community-based and Faith-based Organizations from Ventnor, NJ, responded on December 1, 2003:
The request seems reasonable and maybe insufficient. Minutes of nonprofits
can be woefully inadequate about the nonprofit's workings. I would ask for any
recent audits and financial reports.

When I negotiate a contract for consulting I request a copy of -

• Certificate of Incorporation
  
• Bylaws and mission statement
  
• IRS Form 1023 which was filed for recognition as a 501 (c) (3) tax
  exempt organization
  
• Copy of the current year's budget
  
• Minutes of the three (3) most recent board meetings with agenda
  
• List and profile of officers and board members, addresses and
  telephone numbers and as appropriate e-mail addresses
  
• Copy of 2 recent funding proposals
  
• Copy of all written policies, procedures and forms for recordkeeping,
  program and fiscal
  
• Most recent annual report
  
• Most recent financial report
  
• Most recent annual audit
  
• Most recent annual IRS Form 990 filing
  
• Most recent annual filing with the State of New Jersey
  
• Organizational chart
  
• Promotional material, if available
  
• Board handbook, if available
  

The request is made with the understanding the papers will be returned and
all material is to be kept confidential unless I learn the same matters from
some other source.

This list may be overkill for some folks but some of these documents
should be part of what a board will offer to new prospects.

If a board does
not have a policy about what documents will be made available to prospects,
then the prospects should ask for those documents that will help her/him decide
about joining the board. What would you pick?

In my view the board should decide what will be offered in addition to those
legally required.

I know that as the nonprofit board leadership and I discuss a contract that I
will ask about insurance coverage, current legal issues and litigation,
status of all funding and more.

CAVEAT: I am required to tell you that I am an attorney in the state of New
Jersey. It has not been my intention to give you legal advice. I may have
given you legal information, but not legal advice.

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Carter McNamara wrote in January 2000 to announce:
The Free Management Library suggests several important considerations to address before joining a board. See http://www.mapnp.org/library/boards/boards.htm#anchor585925

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See also "What Must We, What Can We Disclose to the Public, Staff, Board and Clients?" by Don Griesmann in the Nonprofit FAQ at http://www.idealist.org/npofaq/0/1505.html

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Posted 12/1/03; revised to include MAPNP and the FAQ cross-reference 6/25/06 -- PB