|Serving as a Board Member? Protecting Yourself from Legal Liability While Serving Charities. By Dick L. Kranendonk Ed.D. Available from the author for $18.95 at (905)388-6881.
Dick L. Kranendonk has written a volunteer board member’s handbook which is readable and practical and which expertly addresses the principal concerns for governance. Serving as a Board Member? focuses on seven key areas which include the common pitfalls for boards — the charitable gift; organizing as a charity; boards and their members; powers of the board and conducting meetings; duties of board members; hiring the chief executive officer and hiring policies for other staff; and developing a conflict of interest policy.
Particularly valuable are the questions following each chapter flagging what needs attention. An enormous contribution is Kranendonk’s evaluation instrument in the appendix. This simple-to-use and functional tool will be indispensable to a board in evaluating its own participation and performance. In addition to an abundance of valuable information about the powers, duties, and responsibilities of board members, the book is worth buying for this questionnaire alone!
Kranendonk points out that new board members frequently enter the boardroom with a very limited understanding of what is required of them by law. For example, many are unaware that, ” A director is called upon to make decisions for a public organization which exists exclusively for the benefit of the public … and board members are at minimum a fiduciary and likely also a trustee of those organizations.”
Kranendonk argues that, under the influence of Marxist social and political theory, there has been a shift in the government’s view of property rights. This has had a significant impact on current legislation as it relates to charitable organizations, and could have even greater consequences where there is a legal separation of church and state. Although his argument may hold merit, it is not as balanced as it could be. For example, some might argue that the government’s shift from tax deductions to tax credits is not due to a shift in the understanding of property rights but is an attempt to equalize the benefits of donations to the donor regardless of their income level. More explanation is needed.
My understanding of board governance is that the board’s chief occupation is policy making, and that true board leadership means governing out of policies. The reality, however, is that too many boards do not know how to begin this task, let alone recognize what a board policy looks like. While Kranendonk highlights key areas for policy making and sagely points to the negative implications for liability when boards fail to develop policies in these areas, he needs to give more concrete guidance on how to formulate and evaluate policy. Specific examples which demonstrate what distinguishes sound policy form inadequate policy would also be helpful.
Serving as a Board Member? is an essential resource for charitable organizations and should be required reading for everyone in the boardroom.
(Betty McPhee has 25 years experience serving on non-profit boards in a variety of capacities. She is a graduate of York University’s voluntary sector management program, and holds a national certificate in voluntary and non-profit management from the Canadian Centre of Philanthropy.)