Nonprofit boards are teams of individuals who work together to manage the organization. Regular meetings are held to decide on strategy, ensure resources, and provide oversight. Boards may also engage in philanthropic activities, including fundraising and providing professional services for free to the non-profit.
Most states set the minimum number of board members that a nonprofit must have, and some even require that boards be diverse to keep their tax-exempt status. The requirement for diversity isn’t intended to be a political plaything however, diversity should be based on the absence of conflicts of interest or any other reason that might prevent an individual from serving on a board of a non-profit organization.
The Board’s responsibilities includes appointing committees, deciding on and reimbursing CEOs, establishing the budget, overseeing legal issues, reviewing and approving financial reports, determining the amount of compensation for the top staff members, and creating a strategic plan. Boards also represent an organization within the community, and in discussions with donors, government agencies and the media.
Boards need to not only create committees, select and compensate the CEO, and create the budget, but they must also conduct due diligence on prospective donors to ensure they are legitimate and can be relied upon for donations to nonprofits. They also must review the financial reports and approve them, and keep good minutes of each meeting. A functioning Board will take its responsibilities very seriously and work as a team in order to achieve success.