What Are the Responsibilities of a Board Member?

In today’s world, most member-based organizations share a common leadership hierarchy that is comprised of middle managers, directors, a group of C-suite officers, and a Board of Directors. To the untrained eye, it may seem like all external groups beyond the board are contributing to the organization’s day-to-day success. That may leave you asking, “What are the responsibilities of a board member?”

Hollywood vs. Reality

In popular culture, the Board of Directors of an organization is often portrayed as an aloof cabal of executives who leverage their position and influence for personal or professional gain. A fantastic example of this is the HBO original show Succession. In this riveting series, a media mogul is in an almost constant power struggle over the future of his empire with his children on the Board. While the tense scenes of Jeremy Strong’s character proposing to vote his father out of the company may have you on the edge of your seat, this portrayal of board governance is far from reality. 

In the real world, being a board member is still a very high-profile position that comes with many important responsibilities, but without the drama seen in shows and movies. These responsibilities can look very different depending on the organization and its industry, but there are core tenants and responsibilities that are common to most board structures.

Responsibilities of a Board Member

The responsibility of a board member at a high level is to be the voice within the company that keeps the organization moving toward a sustainable and successful future. An article from the National Council of Nonprofits recently encapsulated this idea by saying,

“Rather than steer the boat by managing day-to-day operations, board members provide foresight, oversight, and insight: think of them as up in the crows’ nest scanning the horizon for signs of storms or rainbows to explore…”

The idea of being a guiding force within the organization directly correlates to the traditional responsibilities entrusted to the board. Some of these responsibilities include:

Governance and Guidelines

Creating and maintaining an architecture of organizational guidelines and policies is a fluid process that is a paramount responsibility of the board. It is their job to ensure that all pieces of the organization are functioning within an ethical, transparent, and accountable framework that aligns with the company’s long-term goals. 

To maintain healthy governance policies and guidelines, board members and their various committees conduct audits to analyze current performance and use the results to inform proposed changes to the organization’s strategic plans.

The C-Suite

Another major responsibility of the board is hiring and managing the organization’s various executive officers, including the CEO. The hiring process can be very hands-on for board members, who often participate in the interviewing process. They also help establish the compensation structures for the officers and weigh in on the final hiring decision before making an offer to the candidate.

After the C-suite is brought into the organization, their job is to create the strategic plan and guidelines for the organization. The board’s duty during this is to be an advisor to the officers and act as a check and balance system when implementing the strategic plan.

Board Committees

It is common practice to have a host of committees run by board members to provide oversight and attentiveness to all areas of the company. Some common committees focus on governance and nominations, auditing, public relations, and finance initiatives. Your organization may have different, more niche committees relating to your specific industry. A best practice when forming any new committee is to ensure that it has a distinct purpose and is effectively utilizing the committee members’ time.

Board committees and advisory groups allow for an equal distribution of oversight and responsibility throughout the board, allowing board members to display their unique skills and backgrounds. When utilized properly, a committee can provide crucial insight and guidance on their area of focus to the board. During committee meetings, members often use secure real-time voting software to efficiently cast their votes on various motions related to their agenda items.

An emerging trend for organizations is creating advisory groups of younger individuals who help the organization understand how to better appeal to younger generations. Organizations are adjusting to young millennials and members of Gen Z entering adulthood, and what better way to understand their psyche and spending habits than going straight to the source? The board having this kind of input could prove instrumental in understanding this rapidly growing segment of young professionals.

Board Member Duties

Board members have three basic fiduciary duties. These are legal responsibilities every board member must perform to ensure effectiveness and longevity.

Duty of Loyalty

This duty ensures all Nonprofit activities and transactions are conducted to advance the group’s mission. Board members are bound by their duty to act in the organization’s best interests rather than their own. Responsibilities that fall under the duty of loyalty include:

• Prioritizing the Nonprofit’s interests in all aspects of decision-making.
• Safeguarding confidential information concerning organizational matters and all discussions made during board meetings.
• Recusal from discussions and policymaking due to possible conflicts of interest.

Duty of Care

This duty compels board members to care for the organization by wisely and economically using its assets, including members and facilities. Board members are expected to exercise prudence in making decisions. Duty of care also includes the following responsibilities:

• Regular and active participation in board meetings.
• Staying informed about the Nonprofit’s programs and finances.
• Making decisions with careful consideration of the Nonprofit’s goals and capacity.

Duty of Obedience

This duty mandates board members to ensure the Nonprofit stays true to its mission and maintains compliance with laws and regulations. The duty of obedience includes responsibilities such as:

• Upholding the organization’s policies.
• Ensuring compliance with federal, state, and local laws.
• Upholding ethical standards and operating according to the industry’s best practices.

While these three duties are considered primary obligations, they might not encompass all the responsibilities of a board member. Additional obligations may include playing a significant role in strategy, culture, and financial sustainability.

Roles within the Board

Like any other role within the organization, board members have distinct responsibilities, which are dictated by the various positions within the board itself. However, unlike other positions, board members are elected to their roles by the current board, typically after the annual meeting. Some of the more traditional roles are:

Chairperson

Your board’s chairperson (commonly referred to as the president) serves as the dedicated leader of the entire board. Armed with a deep well of knowledge about your organization and industry, and a passion for leadership, the chairperson helps the entire organization stay on track for success. Their direct responsibilities typically include:

• Coordinating and running board meetings.
• Holding members accountable for attending meetings.
• Establishing committees and assigning members to run them.
• Acting as a public representative for the company during events.

Vice Chair

The vice chair (commonly referred to as the vice president) works closely with and assists the chairperson in their various responsibilities. The vice chair is typically brought on to be the eventual successor to the chairperson, and can fulfill their duties should they be unable to perform them. Their duties include:

• Training closely with the chairperson to prepare to take on their role.
• Ensuring that all board members understand their role within the organization, and facilitating ongoing training to keep the board current on industry procedures and governance best practices.
• Serving on committees to gain a deeper understanding of the organization.

Board Secretary

The board secretary manages the day-to-day function of the board. They are an individual who is able to juggle multiple tasks at a time and has an adept eye for detail. Some of their responsibilities are:

• They ensure a meeting agenda has been prepared and shared with all board members prior to board meetings.
• If there are any auxiliary materials members need to review prior to a meeting, they are accountable for preparing and sharing them with board members ahead of the meeting.
• During meetings, they are in charge of taking detailed minutes of what is discussed. This can also include recording motions, votes, and decisions the members arrive at.
• After meetings, they share the meeting minutes and follow up with individual members about tasks they are managing on behalf of the board.

Board Treasurer

Often filled by a member with extensive financial experience, the board treasurer oversees the organization’s finances and provides guidance on decisions regarding organizational spending. This role typically consists of:

• Serving as the chair of the finance committee, and sometimes taking on the role of CFO.
• Managing corporate bank accounts and reviewing financial statements, which are then reported to the board.
• Assisting the CEO in preparing the annual budget and presenting it to the board for approval.

In Summary

Your Board of Directors is absolutely instrumental to your organization’s long-term success. From crafting and maintaining excellent governance practices to hiring and managing members of the C-Suite, the responsibilities of a board member truly span every part of the organization. If you think being a board member is in your future, be proactive! Board members are almost always on the lookout for passionate individuals who are seeking a leadership role.

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