Q: We have a situation where a small group of people from the executive committee are making all of the decisions. Most of us are okay with the decisions that have been made but are uncomfortable with how they have been made. Let me give you an example. We lost our executive director. The board chair took on the role of interim executive director while handling the search. Everyone was grateful that she stepped up during this chaotic time. However, the next thing we knew, this person was the permanent executive director and she had tapped others for specific positions, including board chair. Each of the individuals are competent people and I sincerely believe they will do an excellent job for the organization in their new positions. However, our bylaws were totally ignored. I’m on the executive committee, and I, along with the rest of the board, first learned of all this once it was fait accompli. This doesn’t seem to pass the smell test. Do you have any thoughts?
A: I agree that this does not pass the smell test. Several things here bother me. Most critical to my mind is that nonprofit organizations are “owned” by the community. Their boards are legally and morally responsible for protecting and advancing the organizations for the community’s benefit. No matter how good the decisions made by a segment of the board may be – whether that be the executive or another committee or, as in this case, individuals – only the full board has the authority to make decisions. The only exception is if the bylaws specifically grant such decision-making power to another entity.
While it is not unusual to delegate decision-making, such authority is typically narrowly defined and limited in scope. In some cases, the states further limit the decisions that may be shared. The situation you describe sounds way out of bounds. You’ve got a rogue individual that is grabbing power and sharing it with those she alone deems worthy. The fact that you and others on the board like the individuals she has selected is irrelevant. According to your bylaws, making these decisions unilaterally is not within her domain; and, ignoring the organization’s bylaws is its own big concern. Bylaws are legal guidelines for how boards are to operate. An organization can be pulled into court for acting outside its bylaws.
A factor that should get the attention of your new executive director is that one cannot use his or her position on the board for personal benefit without significant risk. The fact that as board chair and interim executive director she promoted herself to a paying position is a huge conflict of interest. It is self-dealing and it opens her and the organization to both media scrutiny and substantial financial liability from which she and the organization may never recover.
Not to be ignored is the fact that the organization risks losing good people who answered the call to board service, only to sense that their feelings and wishes are not considered. Replacing them will be difficult as word gets out that directors exist in name only and that decisions are made by a small in-group.
If I were you, I would speak with the new executive director. I would explain that while you have no problem with the people she has put in place or what she has achieved as a result of the decisions she has made, you are deeply concerned about potential ramifications given how the decisions have been arrived at. Feel free to use some of the points I’ve shared here. If you don’t see changes, you may think about resigning from the board to protect your reputation, your pocketbook and your sanity.