Rating Your Board on Governance Best Practices
How would you rate the quality of your board? Top-notch governance is an indispensable ingredient in the recipe to make the entire organization successful. Other factors may contribute — some even markedly — but consistent success is possible only when a board is firing on all cylinders.
Comfortable contentment can become a hidden risk for any organization. What does it mean to do your job as a board member? The answer begins with three core fiduciary duties:
- Duty of care: Exercising reasonable due diligence, prudent judgment, thoughtful prudence and oversight of operations.
- Duty of loyalty: Putting the good of the organization first, ahead of any personal or other consideration, and having systems to avoid conflicts of interest
- Duty to purpose (obedience): Sticking to the mission, complying with the law, and avoiding decisions that could endanger reputation or run afoul of regulators.
Doing your duty is not just about success; it is also about actively engaging in practices that promote good governance. Take this quiz to review and reflect on how your board compares with governance best practices.
Adapted from “Becoming a First-Rate Board,” by by Paul J. Taylor (Trustee Insights, May 2019).