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The range of what a non-for-profit organization can be is immense, but the role the board plays is essentially the same. That is to provide direction and leadership to ensure the mission is accomplished, and that the organization remains viable. Many NFPs are charities set up for a specific purpose such as to provide a social service or to support an outreach mission. Medical foundations have been created to raise funds for research or special treatment programs. Other organizations raise money to support arts and culture initiatives, or to support amateur sports teams. Whatever the need there are NFPs operating at the local, national, and international levels, all intend on making a difference.

Not-for-profit organizations usually seek some form of tax relief status and therefore must conform to a range of legal requirements to protect that entitlement. Organizations must structure and finance themselves to a level that is beyond the capability of the few passionate souls who simply want to deliver a needed service.

The board of directors may well share the passion, but its primary purpose is to run the business model. Its role is to ensure the legals and financials are in good order, and to ensure an acceptable balance on how the organization allocates its resources between administration costs and the actual purpose of the business. One of the major issues NFPs run into is justifying what percentage of its revenue actually gets to the front line. The critical characteristics of a board are directly related to delivering the product as effectively and efficiently as possible.

The following skills are needed in any company, and more formal characteristics are required the larger the organization.

The key visionary might be a member of the board so that the mission and vision are essentially what drives the organization forward.Someone must be charged with understanding the financial expressions. Whether it's creating a budget or having the books audited and in order, the board should have accountancy skills that can provide accurate status reports.The board needs access to legal advice either from a qualified member of the organization or from an accredited company. It's amazing how many charities have no idea how compliant they are.The board should be capable of evaluating major proposals and deliver objective opinions.The board should have access to HR, preferably on the board itself, to deal with people issues that are a significant challenge in the NFP sector.The board must display a supportive and permission giving characteristic. Provided the thrust is in line with the mission and the values, the board should be comfortable leaving goal achievement in the hands of the employees and volunteers.

The NFP sector is populated by extraordinary passion, dedication, and impatience to get into the task at hand. Characteristically, boards should also be passionate and dedicated, and members must also commit themselves to the needs of the organization. Members, however, should ideally be less impatient so that the future direction will be supported by proper due diligence. There should always be a tension between the board and staff members because that tension could well result in a better overall product.

Learn more about this author, Ian Buchanan.
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