Board Room

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Assets:

Cash, stocks, bonds, endowment, real estate or other holdings of a non-profit. Generally, assets are invested, and the income is used to make grants or are distributed otherwise to beneficiaries.

Board Chair:

The Chair in a non-profit organization it often the chief volunteer position, the elected leader of the board.

Board Development:

A process of building effective boards; from recruiting and orienting to engaging and educating board members, it can also include rotations of board members to ensure a good fit with the organization’s governance needs.

Board Member Matrix:

This is a tool to help identify desired characteristics and gaps on a board, and to help recruit adequate board members.

Bylaws:

Bylaws are the rules governing the operation of a non-profit organization. Bylaws often provide the methods for the selection of board of directors, the creation of committees and the conduct of meetings.

Charity (USA):

In its traditional legal meaning, the word “charity” encompasses religion, education, assistance to the government, promotion of health, relief of poverty or distress and other purposes that benefit the community. Non-profit organizations that are organized and operated to further one of these purposes generally will be recognized as exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code (see 501(c)(3)) and will be eligible to receive tax deductible charitable gifts.

Charter:

The legal organizational document for a non-profit; also known as the articles of incorporation or articles of organization; they may also refer to a formal description of responsibilities assigned to a committee, a chapter, or an affiliate.

Community Foundation (USA):

Community Foundation (USA):

Corporate Foundation (USA):

A corporate (company-sponsored) foundation is a private foundation that derives its grant making funds primarily from the contributions of a profit-making business. The company-sponsored foundation often maintains close ties with the donor company, but it is a separate, legal organization, sometimes with its own endowment, and is subject to the same rules and regulations as other private foundations. There are more than 2,000 corporate foundations in the United States holding some $11 billion in assets.

Committee:

Committees allow a subset of board members with the necessary skills to spend additional time focusing attention on a special subject matter. These committees, however, do not relieve the full board of its responsibility for these matters, they merely allow for specialization and help streamline the operations (and the meetings) of the full board. The committee chairs typically present a report to the full board with the committees’ recommendations to the board to adhere to its responsibilities.

Good practice dictates a majority of independent directors on the most important committees to ensure that executive management does not hold undue influence

over handling of matters which require decision making at the board level. Also, best practice requires that the board’s chairperson does not chair any of the committees.

The most common board committees are:

 

  •  Audit Committee – The audit committee is primarily concerned with ensuring that the organization’ financial statements are timely, relevant and reliable; that financial controls are adequate; that the organization complies with relevant regulation, that and external auditors are fulfilling their proper roles. They are commonly responsible for recommending the selection and compensation of the external auditors.
  •  Governance and Nominations Committee – This committee is responsible for assessing the performance and staffing needs of the board and supplying the full board with recommendations on candidates. and others
  •  Other Committees – An organization can add additional standing committees or use ad hoc committees to address additional matters such as risk management, ethics, crisis management, environmental policies, labor issues, technology, and others
Diversity:
A collective mixture of participants from different backgrounds and with different skill sets, aiming for inclusiveness and have different voices speak at the board meeting, rather than the mere presence of people from different backgrounds.
Due diligence:
The expectation that a board member exercises reasonable care and follows the business judgment rule when making decisions.
Duty of care:
The requirement that board members are reasonably informed about the organization’s activities, participate in decisions, and do so in good faith and with the care of an ordinarily prudent person in similar circumstances.
Duty of loyalty:
The requirement that a board member remains faithful and loyal to the organization and avoids conflicts of interest.
Duty of obedience:
The requirement that a board member remains obedient to the central purposes of the organization and respects all laws and legal regulations.
Endowment:
The principal amount of gifts and bequests that are accepted subject to a requirement that the principal be maintained intact and invested to create a source of income for a non-profit organization. Donors may require that the principal remain intact in perpetuity, or for a defined period of time, or until sufficient assets have been accumulated to achieve a designated purpose.
Executive committee:
A committee that has specific powers, outlined in the bylaws, which allow it to acton the board’s behalf when a full board meeting is not possible or necessary.
Fiduciary duties:
A legal obligation to act in the best interest of another entity or person. In the non-profit sector, members of the board of directors have a fiduciary duty to act in the best interest of the organization including in activities related to the funds and other assets owned by the non-profit.
Governance:

The systems and processes concerned with ensuring the overall direction, supervision and accountability of an organisation.

Orientation:
An allotted time window to allow new board members to be educated on their roles, responsibilities, the organization, and how the board works.
Quorum:

The minimum number of committee members that need to be present at a meeting for it to qualify as a properly constituted meeting

Retreat:
An event where the board or staff meet to learn about or explore specific issues; examples include strategic planning, orientation, or self-assessment. It is usually longer than a regular meeting, often off-site and informal in nature.
Term limits:
A restriction on the number of consecutive terms that a person can serve as a board member.
Trustee:

A person who has legal authority to take control of and manage another’s finance and property for the advantage of the beneficiary. A Trustee may also be known as Board Member, Governor or Director.

Vice chair:
A board officer whose main duty is to replace the chair when the chair is not able to carry out his or her duties; may or may not imply position as chair-elect.