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Board Recruitment & Succession Planning

BoardConnect – Arts Victoria Workshops: Session 3

Thursday 18 November, 12.30-2.00pm
Grainger Room, Arts Victoria, Level 6, 2 Kavanagh St, Southbank
Presenter: David Fishel, Director, Positive Solutions & BoardConnect

This workshop was presented as part of the Pilot Program run by BoardConnect on behalf of Arts Victoria.  The material below represents a brief summary of issues raised by presenter and participants and is not intended to be a full guide to the topic under consideration.

Summary Dot Points:

  • Plan ahead for changes, retirements
  • Check constitution for defined recruitment/succession processes
  • Choose a strong Chair, implement duty statements for board members
  • Beware of ‘founder syndrome’, where too much revolves around one person
  • Carry out skills audit of board, but also consider personal characteristics to assess how someone would ‘fit’ into a particular board 
  • Don’t wait for vacancies but have on hand a list of people who have potential qualities for board membership 
  • Build a long list of potential board members, then reduce to a short list through a process of meetings with existing board members 
  • Recruiting new Chair takes much longer and should involve the CEO/Artistic Director, as this is a crucial relationship
  • Set tenure of Chair and board members – e.g. two terms of three years (maximum 6 years)
  • Chair should take responsibility for dealing with ineffective/non-attending board members
  • Fundraising – some boards expect members to donate, others find different mechanisms for board to raise funds

DISCUSSION:
What does succession planning mean?

  • Planning for the future of the board
  • Consider when directors will retire, looking at types of skills currently on the board, and what gaps there are
  • Plan at least 6-12 months in advance for changes
  • Training up current board members to take on new roles.

Considerations

  • Need a strong chair, duty statements for board members (outlining responsibilities and perhaps time they are to dedicate to the organisation), and for the directors to take a full sense of responsibility for governing a purposeful organisation
  • Generally paid staff members should not be board members.  Can create conflicts of interest and blur the line between governance and management
  • Can be invaluable to have board training sessions, building upon existing skills and filling gaps.

Succession planning

Founder Syndrome: The founding director or CEO burns out or leaves after 5-10 years.  This has a detrimental effect particularly when that person likes a ‘hub and spokes’ model, where they’re at the centre of the organisation. This results in the board and staff’s power and authority being diminished, because everything connects back to that one person.  This is a vulnerable position to be in.

  • Need to build up the experience of others around the board table.
  • Need a strong Chair for board meetings, and then share the chairing of subcommittees as a recruiting ground for new board members.
  • Can be helpful to carry out a skills audit to see what skills are there, and what gaps are in place.
  • Skills to audit include arts knowledge, accounting/financial experience, marketing, commercial experience, and importantly, board experience. Need 2-3 people with good board experience to make sure discussions are purposeful and so that known traps can be avoided.
  • There are checklists to assist with skills audits. Templates can be found in David Fishel’s Book of the Board, as well as online.
  • Checklists often don’t cover: interest in the organisation, commitment, energy level, personality sophistication, the ability to disagree during discussions and ‘kiss and make up’ later. These things can be more important than professional skills.
  • Be careful when trying to represent and reflect many aspects of the community. It is generally impossible to achieve this successfully. Very hard to get the right percentages, gender balance, ethnicity, plus all the skills, plus the commitment that the board requires. Find other ways of listening to, and working with, the community, such as biannual forums with the community, subcommittees, etc.

Recruitment
Don't wait for vacancies. The recruitment process can take months.  Consider the constitution/ rules of the organisation – what processes are defined in this document regarding board members (election, tenure, etc.) and does it need to be updated? The board can only recommend changes to the constitution/model rules. Members need to vote on recommended changes to change the document.

  • Some boards like to recruit new members that will reflect their own views. 
  • When vacancies are due to occur, a wide callout for nominations could be sent to members, as well as through board channels. 
  • Consider the requirements of the board (e.g. losing accounting skills, representation of different demographics, certain industry experience, corporate contacts, etc.)
  • Need to have conversations with the right people to ask for suggestions of new members

 How do you identify potential board members for the board?

  • Services such as BoardBank with AbaF
  • Approach professional organisations/peak bodies
  • Research people currently sitting on other boards, as well as those retiring from other boards
  • Discuss with local government
  • Invite possible members to a strategic planning day
  • Board contacts
  • Membership: Members or friends of the organisation
  • Tertiary students
  • Audience members (e.g. announce vacancies through programs)
  • Staff suggestions
  • Key clients

Consider the types of people that may represent/understand the company’s membership base.  Also consider the requirements of the constitution/model rules regarding advising membership of the vacancies.
 
Sponsors and Donors: Having sponsors or donors on the board can be difficult and causes issues with conflicts of interest, amongst other things.  Instead, approach sponsors and donors for their suggestions.

Advertising in newspapers, Arts Hub, etc: This is not common, but can be an option – you need to be clear with the process.
 
Board members could have informal meetings with 2-3 of the suggested people that come forward – try to narrow down from the larger list. Perhaps invite them to a board meeting as an observer, exchange company information if appropriate, continue discussions.  Consider the chemistry of the board and how a new member will fit.

Questions to ask potential new board members:

  • What is their record of achievement?
  • Do they have the capacity to cooperate with others?
  • Are they willing to contribute their skills, resources and networks?
  • Are they genuinely interested in the organisation’s work?
  • Are they sufficiently available to give the time needed?

Recruiting Chairs and the Role of the Chair:

  • Process for recruiting a new chair can take a lot longer than recruiting/succession planning for board members.
  • Role of the Chair should be focused on process and facilitation. 
  • CEO and/or Artistic Director should be involved in meetings with prospective new Chairs. Whilst they don’t have a final say in selecting the Chair, it’s important to ensure there is no friction from the start.

Tenure:
It generally takes 6-9 months for new board members to settle in and understand what is happening.  The common length of tenure is 2-3 year terms, with the chance to re-nominate for up to a total of 6 years.

Example of an issue with re-election: losing almost an entire board at a re-election. Succession planning can help overcome issues like this.

How do you keep good people (strategic thinkers, those who give a strong contribution, etc) on the board and involved with the organisation beyond the total length of tenure allowed? How do you balance this without having them overstay their welcome?

Generally the tenure structure is there to encourage renewal around the board table.  However if there are strong people that want to stay involved and have a meaningful contribution to make, some ideas include:

  • Asking the retiring director to join a subcommittee for a year. After a year, they can be re-nominated for a board role because they have been off the board, but have remained connected with the organisation.
  • Giving them another job to do to maintain the personal relationship.

Asking ineffective board members to leave
It is the responsibility of the Chair.

  • The Chair could meet with the board member informally to discuss, or ask them to resign.  
  • Consider having clauses in the constitution stipulating a minimum number of meetings to be attended.
  • Have an annual review of board effectiveness, which could include considering how many meetings attended, measuring board members against the duty statement, etc.
  • If the Chair is ineffective, the board needs to discuss and take action. 
  • Avoid confrontation. Don’t make it a public process, handle outside the boardroom.
  • Fixed term appointments for Board and Chair.
  • Use the business plan and the skills needs identified within it.

Board donations
It depends on the organisation as to whether this works. It is very successful in some organisations who raise millions through the board each year, however for other organisations it wouldn’t work.

In the US, up to 50 people can be on a board, with a smaller executive, because the board culture in the US is to donate, and this is a good way for companies to raise funds.

There may be an issue of board members that will donate vs those who will actively give time/expertise/value to the organisation.  The Board should be a small purposeful group who are there to do business.  If you find someone who will do this as well as donate, then that’s great. However, if they can’t give their time, consider a different structure for them; e.g. The Chairman’s Circle ($5,000-$10,000 per year entry fee), Patron, etc.

Often staff don’t have the time to find sponsors and donors, it is often left up to the board.  It is widely acknowledged that, in order for a board member to credibly ask for donations/sponsors, they should have donated themselves to the organisation. This may be only $100/year.     

Download a pdfof the Powerpoint Presentation.