Q: Terrie, I need to pick your brain. Our fledging organization is forming its first board after 3 years of working without one. Four of us founded the organization and we have all shared in the day to day responsibilities, serving in different capacities to get the organization off the ground. Our first task is to name a president and chief executive. We want to keep duty and loyalty to the organization a priority so we are looking for some basic guidelines for setting up either bylaws or rules that will hold these individuals accountable and avoid conflicts of interest. Based on what we’ve been reading, we have broken all the rules to date, so your advice is critical. Thanks.

A: Congratulations on taking this step and on your desire to do it correctly. While you may first be forming a board three years into the organization’s life, the concerns you express show a level of sophistication that many organizations older than yours do not possess. This bodes well for your future.

I would start by creating job descriptions for both positions. Begin by determining how you will differentiate the responsibilities of each position and then think through the characteristics and skills that will be required of each. These should be in line with your organizational vision and values. For instance, if you are a grass-roots organization you must have people who believe in hearing the community’s voices and understand how to capture them. Don’t merely consider those attributes already represented by those currently involved in the organization. And, don’t limit your thinking to today’s needs. You want the “right” people and these must be people who have the capability to move your organization beyond where it is currently.

Once you have the people in place, ask them each to create a list of specific goals congruent with the organization’s vision to which they will be personally responsible for achieving within the next year. Get the board to sign off on both the CEO and president’s lists. It wouldn’t hurt to have each director on the board list several personal goals as well. Build in an evaluation period at least quarterly to discuss where each is in the pursuit of his or her goals. You may have to tweak the goals some as the year unfolds, but this quarterly discussion will communicate an organizational commitment to accountability and ensure everyone’s efforts remain on track.

The only concern that you raised that must be dealt with in the bylaws is the conflict of interest issue. EVERY member of the board and staff should sign a conflict of interest disclosure form annually. If you go to http://www.corestrategies4nonprofits.com/tips/7.html you will find what belongs in such a form.

While not required, I would also include in your bylaws a statement requiring adherence to the duty of loyalty. The duty of loyalty refers to making decisions that benefit the organization, not individuals – which is what your conflict of interest disclosure form will help ensure. However, when writing that section, you might also want to cover the concept of loyalty to the community. In cases where loyalty to the organization could result in potentially harming the community, the community’s interests should supersede the organization’s. Enron was a tragic example of where decisions were made to benefit the organization over the community.