I return to Chait, Ryan and Taylor's Governance as Leadership for this week's "inquiring boards" question. It is an excellent example of fiduciary inquiry - not just tending to spreadsheets from a "do the numbers add up" perspective but really asking if we are good stewards of our funds and our mission.
Some boards spend a lot of time tending to the financials and to oversight functions. That is an important element of governance, clearly. But if all we only ask "Is the budget balanced?" and ignore this question about how that budget feeds our stated priorities, we fall short of our fiduciary responsibilities. I've seen too many boards - including boards where I served - miss that critical piece.
- Are we funding our core services at a level that sets them up for success?
- Do we have the staff we need to provide those services? Are they qualified for the responsibilities we assign them, and are we compensating them fairly?
- Are we meeting community needs, and how is that demonstrated in how we allocate our resources?
- Are our funding sources diverse enough to ensure that we are still viable if one takes a hit or disappears?
- Do our grant sources fund stated, mission-advancing priorities; or are we simply following cash where we find it?
- Are our fundraising expenses (including events) in line with the funds gained and the staff and volunteer resources required to generate them?
- Are our financial processes sound? Does our billing system work as it should?
- Does our board receive the information it needs, in a form members find useful, so that the budget can be used as a resource in decision making?
Those are examples of questions that come to mind when I think of the original question posed by Chait and friends. Like that original, they represent a move from oversight to inquiry, which Chait, Ryan and Taylor say "extracts leadership value from a board's engagement in fiduciary work" (p. 37). It's more than monitoring. It's using information strategically, and with accountability, to make the best possible decisions for your organization and those it serves.
How can you use this question to spark a discussion about how you are supporting your priorities? What additional questions do you need to ask to take that conversation deeper and in a meaningful direction?