One of the most significant and defining roles of a Board of Directors in a not-for-profit organization is their ability and commitment to effectively stay engaged in actively governing their organization. During a crisis, whether internally or externally generated, the Board needs to and must remain focused on its governance responsibilities and likely needs to intensify its oversight, evaluation/assessments and communications. It cannot step back, overly delegate responsibilities to management or lessen its roles. The Board must always act on the basis that it is the legal party responsible for the health, well-being, and sustainability of the organization. Management can only act based on directions and authorities delegated formally by the Board acting as a whole through specific motions, Board policies or regulatory requirements.
The following material provides key questions a Board and its Directors should be asking and considering during a crisis period.
1 – What is our action plan for the health and safety of our staff, volunteers, and clients?
If the organization is continuing to operate during the crisis, an action plan is needed to ensure the physical and mental health and safety of clients, staff, and volunteers. The Board needs to know that the appropriate procedures and protocols, communications, training, equipment, and evaluations are planned for and are occurring to the highest quality levels possible. Risks to stakeholders and the organization’s reputation are high and could have lasting negative effects.
2 – What is our financial plan and cash flow capacities?
The Board needs to know directly what cash or liquidity reserves are available for use during the crisis, as well as potential operating loan levels in support of its governance decisions that need to be made based on sound financial information. Such decisions could involve staff layoffs, expenditure reductions, fee/income adjustments, budget recasting and other financial determinants. Cash flow projections will likely be needed at least monthly but possibly weekly.
To ensure the sustainability of the organization post-crisis, financial oversight is central to effective governance and best use of available resources.
3 – What is our approach to communications, working remotely, and sustaining our culture?
In a time of crisis, uncertainty, rumours and a sense of panic/isolation can quickly undermine an organization’s culture and brand. A need exists to ensure several key tasks are being undertaken to preserve the organizational culture.
The first task is regular, timely, and transparent communications, possibly using different messages and approaches with each stakeholder group. Communicating on public health authority guidance; anticipated operational changes and challenges; how to access technical help or ask questions; reminders that we are still operating as a team; and other update and links are critical in sustaining a collective sense of team culture.
Also, if working remotely, the Board needs to know what technology is needed; cost to implement the technology; risks to security and reputation due to working remotely; and the effectiveness being achieved.
4 – What are our risk thresholds and mitigation strategies in a crisis?
The Board always has a primary role in an organization’s management planning involving Board policies and monitoring of risk appetite and tolerances. In a crisis, risk can intensify related to loss of potential staff and volunteers, financial sustainability, reputation impacts, quality of communications, preservation of assets, etc.
The Board needs to provide oversight and monitoring on both continuing and new risks, ensuring adequate awareness of risk changes and impacts, mitigation alternatives, and best practices, amended risk tolerances, and related considerations.
5 – How to sustain required current operations and governance responsibilities?
During a crisis, the Board needs to ensure that required on-going operations and governance activities are being accomplished and recorded. These tasks include Board meetings on digital media; taking of minutes; advancing Executive Director/Chief Executive Officer searches via digital means if required; passing of Board motions; amending as required Board policies; etc.
The Board should not allow lapses in key operational and governance practices using the crisis as an excuse. Board engagement via digital means, such as during this pandemic, needs to intensify and ensure legal and regulatory practices are actively followed.
6 – Can the Board contribute beyond its governance role?
Most Boards of not-for-profit organizations involve individual Directors who have diverse skill sets and experiences that can assist the organization during the crisis. Though the separation of governance and management roles remains important, using all the capacities of the Board members needs to be considered and activated for the well-being and sustainability of the organization. This approach should be undertaken within a consensus and partnership-based framework with management.
For smaller organizations with more limited staffing resources and capacities, it will likely be essential for Board members to be engaged temporarily in operational tasks based on Director skills and experiences. In some cases where the challenges and threats can be severe, a more interventionist-based engagement of the Board may be necessary.
7 – What is our scenario-based crisis plans for an uncertain and evolving operating environment?
One of the key characteristics of a crisis, such as the current pandemic, is the scale and variability of the uncertainties moving forward. These include constantly involving public health guidance, variable and complicated funding supports, moving crisis hot-spots, changing crisis end-point projections, wide-ranging economic impact assessments, etc.
As a result, the Board needs to ensure that not only immediate crisis and risk management is being undertaken effectively and transparently. Crisis scenario planning needs to be on-going which could involve scenarios A, B, C, D, and others in order to both manage through the crisis and to connect with longer-term organizational planning for the post-crisis operating environment.
These scenarios would differ based on crisis longevity projections, possible change in guidance, cash flow capacities, staffing impacts, technology risks and capabilities and other variables.
8 – How can we provide greater value to the community in a crisis?
One question the Board should discuss in depth, is whether the organization, using its full scope of resources, human, financial, facilities, equipment, know-how, etc., can respond to the community’s current needs in a crisis. These actions may be outside the organization’s mission but can provide vitally needed aid and support. Being able to adapt, be flexible and practically respond to community needs enacts the larger role of all non-profits which is to do good, aid others, and use their resources for a common cause.
9 – What is our post-crisis strategy/plan?
The Board has a direct responsibility for the organization’s sustainability and mission achievement. A crisis, especially an external one, can create an altered operating environment post-crisis and new opportunities.
The Board needs to ensure that once immediate crisis tasks are being effectively managed, planning is initiated on the post-crisis mission, positioning and outcomes of the organization. A task force of Board members and staff, possibly with outside resources as well, needs to start the research, scenarios’ development and assessments and positioning alternatives for a potentially changed operating environment. This work cannot be started after the crisis is over or it will likely be to late to sustain the organization if staff are lost, funding is reduced, competition changes and adapts, etc.
Preparedness is a governance responsibility. Iterative transition planning is needed that undertakes the assessment of trends and new information on opportunities and challenges in a phased approach with key objectives and measures.
Fred Galloway, is a Governance Faculty Member at Capacity Canada and specializes in a wide range of assignments with not-for-profit and municipal organizations involving, feasibility and business plans, strategic planning, organizational development reviews, governance, executive search and a host of other services.
He has also been extensively involved in community volunteer work. Fred was a Governor and Chair of the Board of Fanshawe College, Vice President of Sport Services for the 2001 Canada Summer Games hosted in London and Vice Chair of Finance for the 2005 Memorial Cup and multiple Ontario Games. He is currently a member of the Boards of the London Community Foundation, the King’s College Foundation and the London Rowing Society.
Fred holds an Honours Bachelor of Arts Degree in Recreation from the University of Waterloo, Masters of Science Degree in Planning from Michigan State University and a Masters of Business Administration Degree from the University of Western Ontario’s Ivey School of Business. In 2002, he was awarded an Honorary Diploma from Fanshawe College for Community Service.
