Charity boards and the “board experience” conundrum

Amongst poor advice given to those getting started on board careers and those without any board experience is “why don’t you join a charity board?“.

No matter what angle one looks at this from, it is patently bad advice.

Underlying the “advice” is the assumption that charity boards, since they do not pay, cannot attract good directors on their board, are desperate for talent, and will take on any amateur who is willing to talk to them offering their help. To suggest any of this is disingenuous and insulting, to say the least. Charities have objectives and they are accountable to the publics they serve, often funded by donations. Running a charity well requires rock solid governance. That is turn requires skills that go beyond the fiduciary box-ticking and deep into good governance, asking important questions and being transparent and accountable. None of this is a job for an inexperienced board director.

Whenever I have challenged that advice being given to people, I notice another pushback. People underestimate the time and attention a charity may need. This belief is not entirely unconnected with the “voluntary” or unpaid nature of the charity board directorship. But this belief is entirely wrong. If anything, charities have a much wider set of stakeholders than a normal business; issues can be and often are complex; money and other resources are tight so resource allocation is a dynamic and frequent challenge; the sector’s practices regarding pay and operational costs are nearly always under scrutiny creating pressure for ensuring that every penny is spent towards serving the charity’s objectives. And if all this is not enough, at least in the UK, any member of the public can bring about a complaint. This can stretch already tight resources. Charity board directors need alertness and detail-orientation in all they do. They also need to give a lot of time to the charity’s matters. You guessed it. Not the job for an inexperienced board director.

All this before we have even touched upon the thorny issue of vicarious liability for charity board directors. I would encourage all those who advise inexperienced persons to join charity boards to read up on vicarious liability.

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The problem of not having board experience however is real. And it holds back those who may become excellent board directors.

Not everyone will enter a board room through a C-suite. People of colour and women are even less likely to manage that transition. This means the desirous may or may not have worked with or served on an executive board in their career.

With increasingly complex needs of corporate governance, boards are no longer places of rest for retired professionals. To keep up boards are in need of fresh thinking but they worry about taking on someone with no board experience at all.

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There are creative fixes for this two-sided issue in the UK.

The Board Apprentice programme for one.

It is, as the name suggests, a year long apprenticeship with a host board. The host board trains and, within reason, may allow a Board Apprentice to participate like a board director, while ensuring a shadow directorship is not created. The employer of the Board Apprentice of course needs to see value in enabling their employees’ development like this.

The organisation Getting On Board is working to address the talent gap in the charity trustee market itself by engaging with individuals, employers and charities.

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The lack of board experience holding board-keen people back is a real challenge.

Talent development for boards had not necessarily been on exec agendas or even board agendas for a long time. Now as boards come under pressure to be more inclusive and cognitively diverse, new solutions need to be considered.

The demand side of the talent pipeline issue is facing pressure. The answer may well have to emerge from there.

Advising inexperienced board-keen people that they go and become charity board directors is not the answer.

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(Disclaimer: These are my own views and do not reflect the views of the boards of JP Morgan US Smaller Co.s Investment Trust or London Metropolitan University or BeyondMe, where, at the time of writing, I serve as a non-exec director.)