No matter if your firm is commercial (for profit), an S or C Corporation or LLC, a partnership or a non-profit it requires clear direction and supervision. This is usually provided by a board of directors or trustees.
Boards of both you could try this out for-profit as well as non-profit organisations share the exact same responsibilities. These include selecting and evaluating the CEO, creating operating plans, distributing and protecting finances, ensuring that the policies are in line with ethical and legal requirements and advancing the mission of the organization. Nonprofits are also responsible of pursuing tax exempt status and complying with all legal requirements.
A well-functioning Board requires individuals with different skills know-how and contacts to help ensure that the financial future of the business is safe. Boards of both for-profit and non-profit organisations should actively search for and seek out competent candidates, rather than waiting for them to come to them. They should also simplify the process of screening, interviewing, and making decisions.
Non-profit and for-profit boards generally have standing committees that aid in the execution of their governance and management duties including audit, compensation (or human resources) and governance & nominating, and executive. Other committees can be specific to the industry or type of company, such as science & technology, collections & visitor engagement, quality & regulatory, or public affairs & social responsibility. It is a standard practice for board members to disclose any potential conflicts of interests and disqualify themselves from deliberating or voting on matters which fall within their areas of influence or concerns.
