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  • Thursday, November 17, 2022 2:35 PM | Anonymous

    Management access

    The board of directors is responsible for the effective management of the affairs of the not-for-profit corporation. In fact, the Policy Summary provides that the bylaws of a federal not-for-profit corporation must state explicitly that the board has this power, although they may also specifically exclude certain powers that are instead to be exercised by the membership of the corporation. The power to manage the corporation involves:

    ensuring that the objects of the corporation are properly carried out;

    setting long-range objectives and strategic plans for the corporation;

    being responsible for all aspects of the corporation's operations;

    ensuring the corporation's financial stability and overall performance; and,

    supervising management and staff.

    Each individual director of a not-for-profit corporation is also responsible for his or her own acts and omissions while in office. The board of directors must, therefore, have unimpaired access to all the resources of the corporation as necessary in order to effectively perform their management duties.

    Books and records

    A federal not-for-profit corporation is required to keep a book, or books, that records all the constitutional (otherwise known as "constating") documents of the corporation, as well as the names, addresses and occupations of all members and directors of the corporation.Footnote3 It must also keep proper books of account and accounting records of all financial matters and other transactions of the corporation.Footnote4 Failure to do so is an offense under the Canada Corporations Act.

    The Income Tax Act (Canada)Footnote 5 requires charitable corporations to keep certain records and books of account, duplicates of all charitable receipts issued for donations by the charitable corporation, and information that verifies donations made to the charitable corporation.Footnote6

    Because of these statutory requirements, a director of a federal not-for-profit corporation has the right at any reasonable time to inspect and copy all the books, records, and documents (not only those that are publicly available) and to inspect the physical property owned or used by the corporation. This allows directors to exercise their managerial and administrative powers, make informed decisions about the affairs of the corporation, confirm that the corporation is in compliance with all applicable laws, and ensure that any funds collected from the public by the corporation in trust are used only for the designated purposes.

    Notice of meetings

    Meetings of the board of directors of a not-for-profit corporation are an essential way for directors to exercise their power to manage and administer the affairs of the corporation. Therefore, each director has a right to receive proper advance notice of all board meetings.

    Federal not-for-profit corporations must include provisions in their bylaws that address how the corporation will hold its meetings.Footnote7 Generally, the bylaws must establish either a specific amount of time that is reasonable for notice of directors' meetings or must indicate that reasonable notice will be given. While a specific time period is not outlined in the Canada Corporations Act, the Policy Statement recommends a minimum of 14 days for notices sent to directors by mail. The bylaws may also permit notice of directors' meetings to be sent by electronic means, including email or facsimile, or notice to be waived by directors who attend the board meeting.

    If a director is not able to attend a meeting of the board of directors, he or she has the right to review the minutes of such a meeting and any financial statements presented, and may voice an objection to any information these contain.

    The right to attend meetings is subject to directors' fiduciary duty to avoid any conflict of interest. In some circumstances, conflict of interest issues will preclude the director from being present for discussions and votes on particular matters; occasionally, where curing the conflict requires that the director resign, the right to attend meetings will be lost. In such situations, other directors need to be wary of the former director's continuing presence at meetings even as a guest, as this may give rise to an opportunity to improperly influence decisions. Where a director is absent temporarily, owing to a conflict of interest issue, this absence should be carefully recorded in the minutes. (Please see Chapters 2 and 6 for more information on conflicts of interest.)

    Right to vote

    All directors of a federal not-for-profit corporation, except ex-officio and honorary directors, have the right to vote at meetings of the board of directors. The bylaws of the corporation may also, however, give ex-officio and honorary directors the right to vote. However, where the bylaws of the corporation provide voting rights to directors, such voting rights must be equal for all voting directors. This means that such directors may not be given either votes that are weighted differently than other votes (for instance, double or half votes) or the right to vote only on certain specified matters (for instance, giving an honorary treasurer a vote only on financial matters).

    While the right to vote is a basic right, it is subject to directors' fiduciary duty to avoid any conflict of interest in any contract or proposed contract of the corporation. (Please see Chapters 2 and 6 for more information of this duty.)

    Minutes

    A federal not-for-profit corporation must keep minutes of all meetings of its members, directors and the executive committee.Footnote8 Directors have the right to vote on the approval of the minutes of all previous meetings of the board of directors and to voice any objections to them.

    Directors also have a right to inspect the minutes of all meetings as part of their right to access and inspect the corporation's books and records. If the corporation has established committees, the board of directors has the right to receive copies of the minutes of each committee's meetings. This allows directors to fulfill their responsibility to exercise overall management of the corporation.

    Government of Canada

  • Thursday, November 17, 2022 2:22 PM | Anonymous

    Chairman (President)

    The individual who holds the position of nonprofit board chairman is the leader of the board. The board’s chairman supervises all business and affairs of the board. The board secretary often works closely with the board chairman to set the agenda for board meetings and to ensure that the nonprofit is continually compliant with all federal, state and local laws. The board chairman is usually also the facilitator for all board meetings.

    Vice Chairman (Vice President)

    The vice chairman of a nonprofit organization fills in for the chairman as needed. Vice chairmans may also have various other duties as outlined in the bylaws. Some nonprofits, either formally or informally, structure their boards so that the current chairman mentors the vice chairman, preparing that individual to take the next term as chairman.

    Secretary

    Nonprofit secretaries also have important duties. Secretaries often help the chairman gather issues for agenda items and prioritize them according to importance. The secretary ensures that all compliance documents are completed and submitted in a timely manner. During board meetings, the secretary takes the minutes and prepares them for approval at the next meeting. They are also a source for reminders of what the by-laws say about an action, for example, in regards to a quorum. They are also responsible for understanding Robert’s Rules of Order. Additionally, most of the board communication goes through the secretary, who keeps contact information for all board members and puts out most of the correspondence for issues that concern the full board.

    If you do not have a secretary, then your executive director can fill this position.

    Treasurer

    Nonprofit board treasurers prepare the annual budget, and may prepare the  income and expense reports unless you have an executive director. Treasurers also make recommendations to the full board regarding financial matters. Nonprofit boards usually set up another officer, such as the chairman or the vice chairman, to be the second, required signer for paying the organization’s outstanding invoices. Having two signers ensures that nonprofits are accountable for transactions. Treasurers have an important position because they keep board members informed about the financial health of the nonprofit.

    Article by Diligent

  • Thursday, November 17, 2022 9:54 AM | Anonymous

    1.  Determine the Organization's Mission and Purpose

    As missions and purpose can change over time, it is important to discuss yearly if your mission statement, value statement and purpose is still pertain to the needs of the people you serve.  This discussion should happen with your executive director, leave time for discussion.

    2. The Executive Director is your only employee

    The executive director (ED)(manager) is your only employee.  All other employees are the responsibility of the ED.

    You will be responsible for hiring, performance appraisals, hours and wages.

    Your ED will be responsible for hiring, performance appraisals, hours and wages of their staff and will be based on yearly budget approvals.

    3. Financial Oversight

    The board is responsible for approving a yearly budget.  This budget is used by your ED to operate the organization for the year.  This allows your ED to operate efficiently without having to get every purchased approved.  Then the ED will bring to the boards attention if a budget item is going to go over budget and get approval of the board.

    4. Legal & Ethical Accountability

    The boards is responsible for ensuring the organization is operating within the organizations bylaws and policies as well as outside governing laws to ensure the protection and continuity of the organization.  This includes filing all necessary paperwork, paying bills on time and having a board approved code of conduct for both board of directors and employees.

    5. Organization Resources and Planning

    It is the responsibility of the board to ensure the ED has the resources they need to perform their job to the best of their ability.  This will be determined by the strategic plan, mission, vision, purpose and the budget approval processes.

    Strategic planning should be done between every two to five years based on the needs dictated by economy changes, fiscal changes and/or mandate changes.

    The strategic plan maps out the direction of the organization, what you want to accomplish and how you will evaluate if you have succeeded.

    The strategic plan should be completed with all board members and the executive director.  An outside facilitator is best to help guide the process but if finances does not allow, it can be performed by your ED as long as they have some training to do so.

    The budget was discussed earlier, the budget approval allows the ED to pay bill, payroll, organize events and run the day to day needs of the organization.

    6. Promote the Organization to the Public

    The board assists the ED in promoting the organization to the public/community in a positive and informative manner.

    The board is the best form of free publicity the organization has.  When you are networking, promote yourself and promote that you are on the board of directors of said non-profit and let people know what the organization does and the benefits the organization provides and to whom.

    If your non-profit has social media, like the page, share the information and comment positively on the posts.  This gives credibility to the posts and helps to build engagement with the public.  But please do not reply to any negative posts, leave this to the organization staff to deal with negative posts as per your organizations social media policy.

    7. Monitor, Evaluate and Strengthen the Organizations Programs and Services 

    Just like any for-profit business, your non-profit business has programs and services need to be utilized (sold) by/to the public for your organization to continue to operate.

    These programs and services are just like products, if they are not being used to their full potential or are underutilized, you need to determine why and if that program or service just needs to be promoted more or needs to be adjusted or terminated.  You staff have only x number of programs and services that they can operate so they need to be of value to the users.

    The boards responsibility in this area is to review the ED's reports on the programs and services and ask questions.  They can they provide suggestions or direction to the ED if changes need to be decided.

    8. Remember, Your are the Board not the Employee

    Often times, board members try to delve into the day to day operations of the organization.  Remember, this is why you have an ED.  You approved the strategic plan, mission statement, value statement and budget so the ED can do their job.  The ED reports successes and concerns to the board and the board then offers advice to the ED and makes motions to approve changes to budget or large changes of the organization when required.

    At the end of the day, remember to thank each other for their contribution to the organization.  It takes a team to run a non-profit, it is not always easy but it is a satisfying position to be a part of.

    Written by Margaret Plumtree

    Experience:

    Chair of JEDC currently, board member for nine years

    Vice-Chair of VMHA currently, board member for eight years

    Board member of SouthGrow for four years

    Canada Day Committee chair for seven years

    Community Futures Chinook board member for two years

    Mayor for eight years, councillor for one year

    AUMA Small Communities Committee board member for five years

    Alberta Municipalities Economic Strategy Committee board member currently


  • Wednesday, November 16, 2022 8:00 PM | Anonymous

    Tools

    The board manual

    The board manualFootnote1 is crucial to the orientation and training of new and current directors. Board manuals should be well planned, well organized and well used.

    Initially, the board manual serves as an important orientation tool. It provides new board members (and returning board members) with useful information about the corporation, the board and the staff. For the remainder of the director's term, the manual should be an indispensable tool and central resource about the corporation and the board.

    Some of the items that should be included in a board manual are:

    names of board members, their biographies, terms of office and a statement of their responsibilities;

    a list of committees and task forces, with their terms of reference, time frames and membership;

    a brief written history of the corporation and/or a fact sheet about the corporation;

    Letters Patent, supplementary Letters Patent and bylaws;

    mission and vision statements;

    strategic framework or plan, and the current annual operating plan;

    minutes from recent board meetings;

    board policies (e.g., conflict of interest, insurance coverage, expense reimbursement);

    the prior year's annual report and audit report;

    current annual budget and latest financial statement;

    banking resolutions and investment policy;

    current list of major funders or partners and/or stakeholder map;

    organizational chart and staff information;

    annual calendar; and,

    promotional material and website information.

    To be effective, the manual must be current and easy to use. It must allow for materials to be added and removed. Materials included in the manual should have dates on them to make the manual easy to update.

    The manual should be organized into clearly marked sections and include a table of contents. It's a good idea to include pockets to hold brochures and similar items. But be selective. The manual should not be a repository for every piece of information about the corporation. It should be of a reasonable size and weight or else directors may not read it and they are less likely to use it as a reference tool. Avoid including duplicate or similar items and, where possible, use summaries instead of longer documents. However, material that has a direct impact on potential liability of directors, such as letters patent or by-laws, should not be summarized. A copy of the manual should be available for reference during meetings.

    While the task of developing the manual typically rests with staff, it should be done with input by and in consultation with officers and directors. Board members should regularly evaluate its usefulness and provide suggestions for improvement.

    Board retreats

    Board retreats help to solidify a not-for-profit board of directors and enhance its effectiveness by giving board members time to get to know each other and to do long-range or strategic planning for the organization. With their packed agendas and the time pressures typically faced by volunteer directors, regular meetings often do not afford opportunity for lengthy discussion and creative thinking. The value of retreats is they remove the board from outside distractions for a sufficient length of time to enable it to contemplate strategic and governance matters, including the board's own development. They may also be an opportunity to draw on outside expertise to help deal with complex governance or corporate issues.

    In many organizations having annual board retreats is routine; however, the notion of a board retreat in a not-for-profit corporation frequently resonates poorly with the members and/or the public. Often a retreat is seen as an extravagant expenditure. Where the retreat will be held and how much it will cost, rather than the reason for the retreat, can become the focus of attention and debate. Such concerns should alert directors to the need to be able to justify the merit and cost of a retreat if a member or funder questions how worthwhile the event is.

    Evaluation

    Boards should allow time at the end of each board meeting to evaluate the meeting and to identify how future meetings could be improved. Boards should also conduct an extensive annual self-evaluation of their own performance and that of the chair. The performance of individual directors should also be evaluated (usually by the chair), and feedback provided to them.

    Individual directors can also evaluate their own performance, focusing on their contribution to the board and their own objectives for serving on the board.

    Where there are fractious relationships between directors, or the group dynamic as a whole is poor, the board may wish to seek the help of an outside facilitator in conducting the evaluation.

    Finally, the board should seek input from members or other stakeholders through surveys and other tools to determine the level of satisfaction with the governance of the corporation.

    Sample Questions for Prospective Directors to Ask the Organization

    What orientation documents are provided to directors? Is there a Board manual?

    What orientation activities and training are provided to prepare directors for their role?

    Is formal evaluation of the board, and the individual director, undertaken, and is there feedback provided?

    Sample Questions for Directors to Ask the Organization

    What are the performance expectations for directors? Are they defined?

    How am I evaluated?

    What training is planned to improve Board, and director, performance?

    Government of Canada

  • Monday, November 14, 2022 2:32 PM | Anonymous

    A high-functioning board can be a real game-changer for your org — especially if you are at a smaller nonprofit. There are eight main attributes that every high-functioning board member brings to the table. 

    1. They are passionate ambassadors.

    A high-functioning board is filled with enthusiastic storytellers who ignite passion in others and are always eager to invite more folks to know more and do more for your organization.

    Here’s what some have to say about their ambassadors.

    “She is terrified to do public speaking but she is so passionate, seeing the glass as half full. She changes the atmosphere in the room at an event with her energy and passion.”

    ”My board members are so incredibly passionate about the work we do. They give up nights and weekends for meetings, strategic planning and are in the trenches doing the work and are committed to seeing us grow.”

    “She sings our praises to every person she meets.”

    “I am a board member and our board chair is a movement builder and has a vision for the future. Her passion for the work has given us all the shot of energy and direction we needed. I feel absolutely psyched every time I have the chance to work with her.”

    2. They bring expertise, engagement, and thought partnership to the table.

    If you read anything that I write, then you know that I’m always talking about how a thriving nonprofit is like a twin-engine jet. The board and staff must engage and work as co-pilots — and meet each other at the right altitude.

    Here’s what a board that leads with the ED looks like:

    “My treasurer is an angel. She is a retired CPA and so dedicated. She does so much more than our books. She is a problem solver and willing to do whatever it takes for us to be successful. Her wisdom and experience are invaluable.”

    “Two board members in particular offer their expertise regularly and save the organization tons of money.”

    “I have an amazing board. They do not rubber-stamp everything I recommend. They offer direction and expertise AND stay in their lane.”

    3. They make great diplomats.

    No one loves difficult conversations — but they are a fact of life. And a great board member comes with the skill set and mindset to face them without feeling terrified.

    High-functioning board members are pros at reading people, have strong EQ, and can help you and your staff navigate sticky situations and tough conversations with everyone from your donors to your volunteers.

    Here are some great examples of this kind of diplomacy in action:

    “My amazing board member makes magic happen frequently. She is highly respected by the other members and is oftentimes my voice to the board if/when we have a sticky situation or action is needed.”

    “When I began, our organization had some bridge-building to do. One board member used his influence to change many hearts and minds.”

    “I have a board member who is all about relationships, recently negotiating with our landlord on our behalf, softening the landlord’s heart about our work enough to contribute to pay for improvements.”

    4. They help you grow your army of the engaged.

    For a nonprofit (and especially a small one), people = power.

    You need as many diverse people in your corner as possible who know about your organization and are pumped to champion your cause. This army of engaged supporters is always ready to mobilize, to volunteer, and to give.

    And your board plays a key role in helping you share your org’s story, bringing more people closer to your work, and inviting people to join the party.

    Check out how these board members are making an impact in this area:

    “The board chair fearlessly and unapologetically brings the mission to life in her own workplace.”

    “My board chair has brought numerous big donors in as she touches the hearts and minds of those with means within her professional circle.”

    “I have a 70 year old board member who has more energy than a 20 year old. He created a list of contacts that he thought would be great potential donors and has systematically been approaching each of them over the last few months, even traveling to see them!”

    “My current and former Board Chairs are exceptional. They fully understand our cause, have wide board experience and know tons of people.”

    “She is great at filling and filtering the funnel and shepherding stakeholders into matching opportunities.”

    “My favorite board member consistently brings meaningful, aligned opportunities to my attention and makes an effort to ensure that we have the resources to pursue them.”

    5. They are great co-pilots.

    With a high-functioning board working at your side, it never feels like you are flying solo. As I mentioned earlier, leading a nonprofit is like a twin engine jet — your board members are your copilots.

    Great board members bring their most relevant and valuable skills, experiences, connections, and ideas to the table to help you make the big decisions every day and create a long-term vision for your organization.

    6. They provide moral support.

    It’s no secret — nonprofit executive directors have very hard jobs. And they tend to take care of themselves last (if at all). But whether it is by taking a task off of your plate or simply encouraging you to take a break, a high-functioning board is always there to support you through the most challenging times.

    Why? Because they care about your staff, they care about your mission, and they care about you.

    Like these board members:

    “Every time we talk, he wants to know how I am doing (not the organization.”

    “My board chair cares about me and my team on a personal level, showing up for my office manager’s retirement dinner and a memorial service for my husband. He’ll show up with a box of pastries just because. I know he cares about our well being and not just how much work we do.”

    7. They know their board roles

    Board members who know their roles and do not delve into the day to day operations of the business make staff lives more enriched and do not jeopardize the ED's role and position in the organization.

    "My chair is amazing, anytime a new board member tries to discuss the day to day operations, my chair reminds the board, this is what my roles is, then redirects the board to the agenda.  This makes me feel appreciated and trusted by my chair." 

    8. Financials.

    This is usually where it will all go wrong with boards.  The budget process starts with the ED, sometimes along with the treasurer, to create a budget, present it to the board.  The board then approves the budget after making some changes. This is all a normal process of the high-functioning board.  Where things so wrong is at meetings after the budget is approved.  Some boards will continue to look at financials and pick through them with a fine tooth comb, leaving no time for discussion on important topics such as fundraising, events, memberships and the direction of the organization.  Why?  Did you not just approve the budget?  Unless a budget line is not tracking, very little time should be spent on financials, you already approved them.  Instead, focus on the big picture and you too will be a high-functioning board.

    "My board spends so much time on checking over our monthly financials, it is all we have time for in our meetings.  I feel frustrated as they do not allow me time to discuss other important agenda items."

    "My board is amazing, we fly through minutes and financials, only discussing any highlights, then we spend the rest of our meeting discussing how they can assist with sponsorship connections, networking events and introducing me to important people."


    Article by Joan Garry, Consultant for Non-Profits


  • Sunday, November 13, 2022 2:30 PM | Anonymous

    Executive Directors consider it sport to blame the board for lots of things – not responding to emails, not reading board reports, focusing on the trees rather than the forest. And oh yes, then there is the sport of nagging board members to raise money and getting nowhere.

    Executive Directors seem to really enjoy complaining about their boards. It’s like they would like the board to just go away and leave them alone.

    So today, let’s play that game.

    What if after a lengthy nagging session at a board meeting, your board members stood up and never returned.

    Or if one day you sat at your desk and said, “I wish my board would disappear.”

    And they did.

    What would your E.D. life look like without a board?

    GREAT NEWS: YOU ARE NOW TOTALLY IN CHARGE

    Wow! Exciting! Your board disappeared! No one to micromanage your decisions. No more writing board reports nobody ever reads. No more needing to spend time crafting monthly emails alerting board members of big successes. Emails that get no responses.

    You don’t have to waste a single ounce of energy being frustrated that the board isn’t raising money.

    You can decide on the centerpieces for the gala. You can do all the outreach to potential sponsors. You can do all the fundraising, manage the staff, recruit volunteers. No board members will get in your way and you don’t have to be disappointed that they are not helping/supporting/partnering.

    BUT WAIT….

    An entire team of folks who are passionate about your organization’s mission have just disappeared. I know you think that they aren’t always very present, but gone altogether?

    That doesn’t seem like a good thing does it?

    YOU’RE NOW TOTALLY IN CHARGE: IS THAT REALLY SUCH A GREAT THING?

    Consider some of the following:

    • You’re not a CPA and it’s audit time. You don’t have a big staff and the auditor has just asked a question and you are clueless. Where do you turn?
    • Someday there will be a gala. Wouldn’t it be great if each of your board members worked the room and said hello and thank you so that every single guest met an organizational leader? Yes, it would be. But your board disappeared, remember?
    • When your board disappeared, so did the money it raised. Some of (not all) your board members gave generously. Not anymore.
    • Oh. that connection you had to Wells Fargo. That meeting your board member set up with the Head of Corporate Social Responsibility? She asked for a proposal! They were really good friends. Is it possible she asked because of that relationship? You try calling her to check in. Huh. She’s not returning your calls.

    A thriving nonprofit is like a twin-engine jet and in that cockpit is always a pilot and a co-pilot. Executive Director and a board chair. When something goes wrong – financial crisis, staff unrest, community crisis, do you really want to be flying solo? With all those passengers aboard (stakeholders, donors, clients)? No board? You are on your own my friend.

    OK, IF YOU DON’T REALLY WANT YOUR BOARD TO DISAPPEAR, THEN…

    Repeat after me: The board you have is the board you build. It’s time to start thinking strategically about what this board of yours needs to look like – skills, attributes and expertise. Invest in adding maybe 1 or 2 people whose values align with yours, who bring something of value, and whose pilot light for the mission of your organization shines brightly. One board member can be the kindling you need to ignite your board.

    Pay attention to who your NEXT board chair should be. The game of Board Bashing often includes nearly hilarious stories about the lack of leadership on your board – that the recent board chair was elected while in the restroom. You know how the game goes. I talk to clients who complain about their board chairs and it’s like the person just landed from Mars – as if the client has no clue how they got the second most important job in the organization. If you ask yourself right this minute, “Who on my board could be our next board chair and would be really terrific?” and you don’t have a good answer (i.e. nobody, Surina but she’s too busy and will never say yes or Katina but she isn’t on our board yet), you are not spending enough or the right kind of time investing in leadership development on your board.

    When was the last time you gave your board goosebumps? How about we try that game instead? I’ll admit. Approving minutes can be incredibly exhilarating (that was a joke) but it will take more than approving minutes to ignite your board to take action, to become ambassadors and storytellers. I was working with an organization years ago and the board chair said this about the upcoming retreat we were working on. “All of us on the board hear how lucky we are that Vanessa is our E.D. – that when she speaks at conferences, she lights up the room, she brings people to tears, she calls people to action. We never see that at board meetings – can you ask her to give us some of that at the retreat?” Oy.

    If you focus on the low performing board members you will take the others for granted. Don’t. Appreciate your board at least once a year. You can, I promise you, find one nice thing to say about each member of your board.

    You are a fierce advocate for your cause, your clients. You sit in front of folks and ask them for time and treasure to support the work. You make (made?) speeches at galas that inspire attendees to think about their place in the world – to consider how they can contribute and bring a sense of meaning and purpose to their lives.

    And yet, far too often, Executive Directors are downright passive when it comes to the critical task of strengthening the board – building leadership, identifying new board members and taking a good hard look at how (if at all) you invest time to fuel them, to brighten their pilot lights, to ignite them to feel a sense of urgency about the work and enthusiasm about sharing the impact of your work on others.

    A thriving nonprofit is like a twin engine jet. It demands two high functioning engines. Staff. And Board.

    Boards can be frustrating, but you need ‘em. And you need to invest in ‘em. Cause ain’t nobody (as much as we all want to travel) gonna board a jet that’s missing an engine.

    Article by Joan Garry, Consultant for Non-Profits


  • Saturday, November 12, 2022 2:28 PM | Anonymous

    Habit 1: Ask For Help

    Asking for help is a sign of strength, not weakness. Take an issue to your staff. Tell them you are struggling and see pros and cons on a particular issue and that you need their good thinking.

    I’ll admit, it can be harder to do the same with your board. But here’s the thing. If you time and again go to the board with all the answers, they might admire you. But they will be disengaged and will not be the ambassadors you need.

    If you are a board chair, I know you don’t know what you don’t know. Leading a board is a tough job to fake. Resources are out there.

    Lastly, ask your colleagues. They are NOT competitors. Can you please get that one out of your head? Share your challenges and offer your help with theirs.

    Nonprofit leadership is “shared leadership”. If you don’t share the challenges, you have a leader and followers.

    Habit 2: Talk Less, Listen More

    In Lin-Manuel Miranda’s Broadway mega-hit Hamilton, Aaron Burr suggests that Hamilton, “talk less, smile more.” With apologies, I’d suggest that ‘listening more’ is a much more important habit.

    In fact, I can’t think of a situation in which this is not a critical habit to cultivate.

    A twenty minute gala speech? Please don’t do that to your guests.

    A 1,000 word speech (that’s about 7 minutes, by the way) that packs a punch and ignites the room? That is what I am talking about.

    Less is more.

    How about in a meeting with staff? Someone comes in with a problem. Try this: If I were not here what choice would you make? Listen to them, be a thought partner.

    Here’s another one – happens all the time. You spend so much time ‘selling’ a board member to climb aboard your organization’s “bus,” that you don’t listen to hear if they have the passion and commitment that will fuel them to be a fantastic ambassador for your organization.

    And my oh my, how often nonprofit leaders think that a monologue is the key to a successful ask for money.

    Cultivate the habit of really listening to what your prospect cares about, the questions she asks, what motivates her philanthropy. If you are too busy trying to make sure she knows about every single thing your organization does, you will miss all of that.

    Habit 3: Exude Passion

    You probably assume that since you’re a leader in your org, people know you are deeply committed. Maybe they do. But you have to SHOW IT. Regularly.

    People need to be inspired by you. Full stop.

    Because passion is contagious.

    Think of it this way. The Quakers believe that there is a light in everyone. I suppose you could call it a soul too. I think about it like a “pilot light.” When someone decides to join your “army of the engaged,” her “pilot light” is on. You have determined that this light is deeply connected specifically to your mission and cause. Your job is not just to keep the light on but to stoke it.

    I was designing a strategy offsite for a board and the chair said, “Can we have some time with the E.D. where he inspires us? We hear that he gives speeches all across the country and folks are totally engaged. We never get any of that and we really need it to be motivated to do our jobs well. But all we just get a report and then we get nagged to raise money.”

    Need I say more?

    The same is true of staff meetings. The work is hard and it always feels like a steep climb. Your staff looks to you to remind them why it matters. If you are haggard, you give them permission to be haggard. If you complain, you build a culture of complaining. If you encourage powerful storytelling at meetings, folks will follow your lead.

    That’s why they call you the leader.

    Habit 4: Ask Really Good Questions

    I was going to say that the habit is to “ask the right questions,” but if you ask really good ones, they lead you there. Here are a few good examples:

    Finance: ”Based on these year-to-date financials, would you suggest that we make any different decisions about our goals or strategies for next year?”

    Strategy: “What are we best in the world at? If we disappeared, would there be a gap? Who would fill it?”

    Staff: “What do you need to be successful?” or conversely: “Do you still consider this work important, a privilege? If you hear ‘no’ (because you listen more – see habit 2), tease that out. Maybe his pilot light is out and his job performance is suffering. Figure it out together.

    Board: “When you leave this board, what do you want us to be able to say you contributed?”

    Habit 5: Touch the Work

    You can sit at your desk and spend your entire day answering emails and putting out “fires.” Or you can meet a client, sit at the reception desk, answer a hotline call.

    If you choose the former, you risk your “pilot light” going out. Choose the latter and you remind yourself what really matters. And that is as true for board and staff (non-program) as it is for you.

    Get admin staff engaged in the client work. And then, when an admin copies a check that represents a homeless person’s rent, there will be no margin for error for him. Because it’s not a check. It’s a home.

    Habit 6: Get Comfortable Being Uncomfortable

    You want to be an effective leader, so don’t dance around tough stuff.

    Not inside with your staff, not with your board, not with those outside your organization, and especially not with those who stand in opposition to your work.

    Grab a book called “Difficult Conversations” and learn how to do it well.

    Consider some professional media training (FYI – there’s a GREAT masterclass on media training inside my monthly membership community for board and staff leaders, the Nonprofit Leadership Lab.)

    After all, it can feel hard to make your point directly.

    Do you run a food pantry or homeless shelter? Get ready for folks to take you on. “I saw that person in the food pantry and they had a great looking car. I don’t get it.”

    You may want to punch the person in the nose. But learn how to deal with discomfort. “We are not here to judge; we are here to serve.”

    Habit 7: Apologize More Often

    I have coached countless leaders through their annual reviews. They send me the documentation and then attempt to litigate every point with me, defending how hard they work, calling out the board for not working hard enough, but not hearing what is being said to them.

    Defensiveness will take a leader down – I have seen it happen.

    Own the decisions you make that aren’t successful. “I thought it would work and it didn’t.” You didn’t return a board member’s call in a timely fashion? Enough already with the, “you just don’t know how busy I am,” and apologize.

    Why do people find it so damned hard to just say, I’m really sorry? I dropped the ball.

    Get in the habit. I often say that being a nonprofit leader is like being a juggler. But a juggler where someone keeps tossing more and more balls your way.

    At some point, you will drop a ball. The effective nonprofit leader makes an intentional decision about which ball to drop.

    Habit 8: Be Joyful

    If there’s one thing that sets apart a great nonprofit leader from a good one, it’s the joy she brings to the work.

    On the good days and on the bad days, there is an underlying vibe – the one that comes with knowing that you are leading an effort to change something in this world that to many seems broken beyond repair.

    How can we end hunger? Hey, join me! I run a food kitchen. We make remarkable meals based only on what we pick up at supermarkets. We engage with our guests, brightening their days. We have amazing and joyful volunteers who feel a sense of pride and privilege about their efforts. We all head home tired but knowing that there is something joyful about helping others. It’s a privilege.

    ONE BONUS HABIT I’M “STEALING”

    Sharpen the Saw

    OK, so this one is the same as Covey’s 7th habit. But it’s so important and applies here too.

    It comes down to this. If you constantly put the pedal to the metal… if you never take time to develop your skills and deepen your knowledge… you’re going to burn out. You certainly won’t get better at what you do.

    Attend a lecture. Read a book. Listen to a podcast. Take a class, online or offline.

    Article by Joan Garry Consultant for Non-Profits


  • Friday, November 11, 2022 2:24 PM | Anonymous

    I WAS ONCE A WELL PAID NONPROFIT EXECUTIVE DIRECTOR

    As you may know, in the years before I started Joan Garry Consulting, I served as the Executive Director at GLAAD, a mid-size gay rights nonprofit.

    During my tenure, a leading publication conducted an annual survey of the salaries of executive directors in our particular sector. My colleagues and I dreaded the day this article hit the newsstand every year.

    Why?

    No one wanted to be at the top of the list.

    Hit the top and you became a target. Your board starts asking questions about comparable compensation and folks in general just start making comments – and not of the “you’re worth every penny” variety.

    I call this phenomenon “salary angst.”

    Salary angst doesn’t happen in the private sector. CEOs fight for the honor of making the biggest salary. Right or wrong, it’s considered a measure of effectiveness. It means you’re a good negotiator. Companies fall over themselves to pay more money to attract the candidates they consider the best.

    Not remotely so in the nonprofit sector.

    One year I hit the #1 spot on the salary survey. Ugh. Salary angst.

    What made this even worse was that GLAAD wasn’t the largest organization in the movement. Why should I be making so much money? Never mind that it was a major pay cut from what I made in the private sector before I came aboard.

    I found myself having to justify being well compensated. It made no difference that I had been, by many measures, an effective leader, manager, strategist, public voice, and movement leader.

    While I no longer work as an executive director, I sure do work with a lot of them. Some of them feel a sense of guilt at making a semi-reasonable salary. Others resent making so little. But for most of them, their salary isn’t something they feel particularly good about. They have serious salary angst.

    This has big consequences.

    THE CONSEQUENCES OF EXECUTIVE DIRECTOR SALARY ANGST

    Nonprofits exist in a free market. They need to be competitive in order to attract the best talent.

    It’s that simple.

    Big companies pay big bucks.

    Startups attract outstanding leaders by offering company shares that can eventually make the CEO very rich.

    Strong leadership is not just important for a nonprofit – it’s absolutely critical. This person is the voice and face of your organization. The strategist. The visionary. The lead fundraiser. The advocate. A leader in your sector.

    Without strong leadership, nonprofits die.

    So no – it’s not true that every dollar paid to the “pig” CEO is a dollar pulled away from achieving the mission. To the contrary, a healthy nonprofit with outstanding leadership will be able to help more people in a more effective and bigger way for a much longer time. They achieve their missions faster.

    When a terrific leader from the private sector is considering a position at a nonprofit, there’s only so much of a pay cut she’s usually willing to take. Yes, it’s an opportunity to do good in the world… to make a real difference… and that has serious value all by itself. But that doesn’t put her kids through college. And there are plenty of ways to do good in the world while working in the private sector and making a lot more money.

    Do you see how short sighted nonprofits shoot themselves in the foot by not paying competitive salaries to their top leaders?

    6 WAYS NONPROFITS MAKE THEIR LEADERS FEEL SALARY ANGST

    Boards that overly focus on reducing overhead at the cost of not attracting the very best available leadership tend to screw up contract discussions. This is a great way to make the leader feel the salary angst. It’s also the fast lane to a leadership exit.

    For example:

    1. They avoid salary discussions. When the ED has to nag the board chair to remind her that it is well past 12 months since the last annual review and compensation discussion. No one ever wants to nag the boss for a raise.
    2. The process takes forever. It never feels like it is taking forever to board members. They are busy people and lose track. Meanwhile the ED sits and waits. And gets frustrated and feels de-valued.
    3. “Conversations” happen via email. Discussions about how much money you make should not happen in email. Email is voiceless, toneless, and never can communicate the sense of value and appreciation that ED’s need to hear.
    4. Board Chairs say “You know our organization can’t afford to do any more.” If I’m an ED, I hear that and realize that my board is not making any connection between my salary and their ability to fundraising aggressively on behalf of the organization. And you know how I feel? Really angry.
    5. Board member says “The joy and privilege of working at a nonprofit has to be considered as part of your compensation.” It is a joy and a privilege but don’t let this one go if someone says it. As I wrote before, there are lots of ways to do good and important things in this world. Why should the ED want to stay at this nonprofit.
    6. Your spouse’s high paying job is mentioned during your salary negotiation. This happens more than you’d imagine. Honestly, it’s offensive. What your spouse makes has nothing to do what you should make. NOTHING. It’s wishful thinking on your board’s part that you’d work for cheap (or free?) But why should you? You are a high performing ED. You have power in these discussions. If I found myself in that position, I’d either say, “I’m going to pretend you didn’t say that” or “That comment and information is both irrelevant and offensive.”

    HOW CAN SMALLER NONPROFITS DEAL WITH SALARY ANGST?

    Here’s the dilemma. It’s all well and good to say that nonprofits need to pay competitive salaries. Perhaps you’re thinking, “I’m sure a UNICEF or Red Cross can afford to do that. But I work at a 6-person nonprofit with less than a million dollars in revenues. Do you actually expect us to pay 25% of our total budget to the Executive Director?”

    It’s true. Smaller organizations may not be able to compensate their EDs as well as they deserve. There are hundreds of thousands of 501c3 organizations in the US with budgets under $500,000.

    Private sector startups without much or any revenue handle this by offering stock options. That’s not something nonprofits can do.

    But what you can do is make the ED feel like a million bucks. At the end of the day, it’s the combination of a reasonable wage and solid value and appreciation that will fire up an ED to deliver a five-star performance.

    Here are 8 things smaller nonprofits can do to make their EDs feel valued, especially if they’re not in a position to offer competitive salaries.

    1. Annual review. Formal and on time. Get out in front and alert your ED that you know it’s coming up. Don’t make the ED nag.
    2. Offer a contract. Ask your ED if she would like a 2 or 3 year contract. Just the request alone tells her that you want her to stay and value her contribution.
    3. Get creative about money. Maybe the organization cannot afford a raise. Tell her that and also tell her that the board is going to take responsibility for a year-end bonus of some sort based on some simple achievements. Then, unbeknownst to the ED, each board member gives (stretches if they have to) to reach a very nice amount. Can you imagine how much that would mean to an ED?
    4. Time off. Add more vacation time. And then it must be the board chair’s obligation to check in and ensure that it is being taken.
    5. Get creative about assets. Consider assets that the board has that can be part of a compensation package. A one-week vacation at a board member’s second home while the board member is out of town. Or even a long weekend.
    6. Make sure the salary is reasonable. Do your homework. Be sure your ED is being paid on par with other nonprofit ED’s in your size and geography.
    7. Respond. Make a board commitment to respond to every ‘success’ email the ED sends (if you believe you can deliver on it). ED’s talk all the time about the “radio silence” they get to exciting emails about program successes. If a board could change that dynamic, the level of appreciation an ED feels skyrockets.
    8. Offer a sabbatical. How about a month off with pay? Great way to test drive the organization with the board and other staff driving. Great way for an ED to re-charge. Note: Please give this some thought and not through a corporate or even an academic lens. Boards often reject this out of hand because it is not in their frame of reference. Don’t take my work for it. Read this article from the Stanford Social Innovation Review.

    Article by Joan Garry, Consultant for Non-Profits


  • Thursday, November 10, 2022 2:22 PM | Anonymous

    Click on the link below to listen to the video by Dan Pallotta on The way we think about charity is dead wrong.

    Too many nonprofits, he says, are rewarded for how little they spend -- not for what they get done. Instead of equating frugality with morality, he asks us to start rewarding charities for their big goals and big accomplishments (even if that comes with big expenses). In this bold talk, he says: Let's change the way we think about changing the world.

    Video Link


  • Wednesday, November 09, 2022 2:42 PM | Anonymous

    Generally

    Indemnification is an agreement by the corporation to cover the cost of, or compensate directors for, losses or damages caused by lawsuits based on the director's actions or inactions in his or her capacity as a director. The undertaking to pay these costs must be set out in the corporate bylaws. Indemnification usually includes coverage for the cost of defending legal actions. Coverage may or may not extend to situations where the action is successful and the director is culpable; however, normally indemnification will not apply in situations where the act is illegal.

    All not-for-profit corporations

    Federal statutory provisions

    The Canada Corporations ActFootnote2 permits a not-for-profit corporation to adopt a bylaw indemnifying the directors and officers of the corporation against all costs relating to any action or legal proceeding that arises from the execution of their duties of office. This does not apply to legal action that results from directors' or officers' own wilful neglect or default.

    It is advantageous and advisable to adopt an indemnification bylaw. However, such a bylaw would be of little help in situations where:

    the corporation does not have sufficient assets or insurance coverage to meet the financial obligations of the indemnity;

    a director's or officer's acts were beyond the scope of his or her authority as a director, or a director acted without good faith or acted dishonestly;

    a director's or officer's actions or inactions constitute wilful neglect or default;

    a director's or officer's actions or inactions constitute a breach of his or her own fiduciary obligations to the corporation, even if this did not amount to wilful neglect or default;

    a director or officer is held personally liable for statutory monetary payments, such as unpaid wages or government deductions; or

    a director or officer is involved in a Criminal Code offence, such as sexual abuse against children or violation of provisions of the Anti-terrorism Act (Canada).

    Although the Canada Corporations Act allows not-for-profit corporations to indemnify directors and officers, some corporations do not adopt indemnification bylaws. Others fail to ensure that the bylaw is properly adopted. Typically this happens because:

    the corporation has been in existence for a number of years and its board of directors was never advised of the importance of passing an indemnification bylaw;

    the wording of the indemnification bylaw incorrectly reflects the indemnification provision of a business corporation rather than the indemnification provisions contained in the Canada Corporations Act for not-for-profit corporationsFootnote3; or

    the indemnification bylaw was never approved by the members of the corporation as required by the Canada Corporations Act.

    Provincial statutory provisions

    In Ontario, the Corporations Act (Ontario)Footnote4 allows not-for-profit corporations to adopt a similar form of indemnification bylaw as that found in the Canada Corporations Act. Under the Corporations Act (Ontario) and similar corporate legislation in other provinces, a corporation may indemnify its directors and officers for personal liability arising from an act or omission in performing their duties. However, an Ontario not-for-profit corporation may not indemnify a director or officer for liability arising from a failure of the director to act honestly or in good faith in performing those duties.

    In Quibec , the Companies Act allows directors to be indemnified "with the consent of the corporation given at any general meeting there-of" for costs, charges and expenses sustained in relation to a suit or proceedings brought against them with respect to the execution of their duties or in relation to the affairs of their office, if they are not occasioned by their own fault.Footnote5 This bylaw can either be in regard to a particular action or apply more generally. In practice, a general bylaw providing for mandatory indemnification is preferred. This avoids directors being at the mercy of the members when the need for indemnification with respect to a specific matter arises.

    Sometimes provincial statutes provide for indemnification within court proceedings, as well as or instead of by way of a bylaw.

    For instance, the Societies Act (British Columbia) requires court approval of indemnification. It also requires honesty and good faith, and—in some contexts—reasonable grounds for believing the conduct was lawful. Section 30(2) of the Act provides:

    A society may, with the approval of the court, indemnify a director or former director of the society or a director or former director of a subsidiary of the society, and his or her heirs and personal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgement, actually and reasonably incurred by him or her, in a civil, criminal or administrative action or proceeding to which he or she is made a party because of being or having been a director, including an action brought by the society or subsidiary, if:

    he or she acted honestly and in good faith with a view to the best interests of the society or subsidiary of which he or she is or was a director, and

    in the case of a criminal or administrative action or proceeding, he or she had reasonable grounds for believing his or her conduct was lawful.

    Directors of not-for profit corporations need to carefully determine what, if any, indemnification provisions govern in their jurisdictions.

    Charitable corporations

    Note

    The following comments deal both with indemnification and insurance; see below for a discussion of the more general aspects of insurance.

    The Office of the Public Guardian and Trustee in Ontario has taken the position that a charitable corporation in Ontario cannot indemnify its directors or purchase directors and officers liability insurance without first obtaining court approval. Its rationale is that these measures are a perceived benefit to directors. This extension of the common law rule prohibiting remuneration of directors of charitable corporations has proved to be an awkward restriction on the operation of charitable corporations.

    As a result, the Charities Accounting Act has been amended and now includes regulations that allow a charitable corporation in Ontario to indemnify its directors or officers from personal liability for acts or omissions arising from the performance of their duties. Charities must follow the requirements of the regulations and cannot indemnify a director for liability arising from a failure to act honestly or in good faith.

    The same regulations permit charities to purchase directors and officers insurance to cover personal liability arising from the acts or omissions of directors or officers in performing their duties. However, the terms of the directors and officers insurance and the terms of the indemnification bylaw may not impair a third party's right to bring legal action against the director or officer. The regulations also state that the purchase of the insurance policy must not unduly impair the carrying out of the religious, educational, charitable or public purposes for which the charity holds property. The board of directors of the corporation must consider the following criteria before giving an indemnity or purchasing directors and officers insurance:

    the degree of risk to which the director or officer is or may be exposed (e.g., a charity engaged in research will likely be at less risk than a charity engaged in service delivery);

    whether, in practice, the risk cannot be eliminated or significantly reduced by means other than the indemnity or insurance (e.g., can the charity institute procedures or designate staff to monitor and respond to the risk);

    whether the amount or cost of the insurance is reasonable in relation to the risk;

    whether the cost of the insurance is reasonable in relation to the revenue available to the charity; and,

    whether it advances the administration and management of the charitable property to give the indemnity or purchase the insurance.

    The regulations state that a charity cannot pay an indemnity or purchase insurance if, as a result, the amount of debt and liability of the corporation would exceed the value of the charitable property or would render the corporation insolvent. In addition, the indemnity may only be paid or the insurance purchased from the charitable property to which the personal liability relates and not from any other charitable property. This means that income from donor restricted funds, such as endowment funds, that would otherwise not normally attract liability for a director or officer should not be used to purchase directors and officers liability insurance or to pay an indemnity claim. Diversion of such monies for indemnification or insurance could be challenged as use of the charitable property for an improper purpose.

    For federally incorporated charities, and in common law provinces other than Ontario—where the matter has been dealt with through legislation—the question of whether indemnification or insurance constitutes a benefit for directors of charities has not been settled. If not improper, such measures in these jurisdictions are at least subject to being challenged unless sanctioned by a court. Since Quebec is a civil law jurisdiction, this issue does not arise.






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