2017-03-15 00:00:00 Nonprofit Organizations English Limit the board term of the members of your advisory committee to foster new ideas, introduce new energy, and protect against fraud. https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2017/06/board-members-review-organization-finances.jpg https://quickbooks.intuit.com/ca/resources/nonprofit-organizations/advisory-board-limiting-terms/ Advisory Board Management: Limiting Terms

Advisory Board Management: Limiting Terms

3 min read

Your nonprofit may have incredible board members you’d never want to leave. Because of their hard work and contributions to your nonprofit, it may be hard to imagine your advisory board without certain people serving on it, but there are a number of reason you should consider limiting the amount of time someone can serve on a board.

Fresh New Ideas and Energy

Your board members may get fatigued after some time and not approach your cause with the same level of urgency and effort as they once did. Bringing in new board members gives you organization new energy from people vigorous about helping support your cause. It introduces new ideas, talents, skills, and community connections that can further what you are already doing. The contributions of your existing board members are surely appreciated, but your nonprofit must always push to operate in the best way. This is done by having dedicated board members who can creatively look at your problems.

Changing Needs

As your nonprofit grows, you may come across needs that are different from a few months ago. Last year, your nonprofit might have struggled to get donations and was always operating at a loss. Now, your nonprofit may be overflowing with cash and may be thinking of expansion options. Your needs one year ago are not the same as the needs you have today so your advisory board should change as your needs change. The people serving on your board might’ve helped with the issues faced last year but may not have the experience to handle your new direction.

Fraud Protection

Your board members can be given a lot of responsibility, and this is a power in which people may sometimes take advantage. Advisory members may be able to deposit or sign checks in emergency situations. In these cases, a board member may abuse his or her power. If the term of board members is limited, you will eventually stop any fraudulent activity because the board member is no longer serving.

Social Outreach Expansion

By removing board members after a certain amount of time, you bring in new advisors. This increases the exposure you receive within your community because your new board members will have relationships you may not have previously used. An important thing to realize is the old relationship with the old board member doesn’t have to be completely severed. This person can and should still be invited to annual events, and may be used in a consulting capacity, or be sent donation requests. A board member who served out his or her term is likely to be dedicated to your cause. Even if the term is up, the board member can still support your nonprofit, just like the new board member and new connections can.

Protection Against Bad Board Members

Unfortunately, not every board member may contribute how you would like. If you set a fixed amount of time a board member can serve, a bad board member can be removed because of the passing of time. This allows you to maintain the relationship with the board member without upsetting, insulting, or damaging the relationships that person holds. You may not have any way of telling if a board member will develop into a bad advisor when you are choosing advisors. Limiting the amount of time board members serve can act as an insurance policy to ensure they cannot damage your board for an extended amount of time. Whether for positive or negative reasons, there are multiple reasons to limit the amount of time your board members can serve. Although it may be a difficult breakup to think about, the long-term success of your nonprofit may benefit from issuing this policy.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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