The Board’s Role In Human Resource Management
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Article Summary
How can nonprofit boards support effective HR management without overstepping their governance role? This article explores the distinction between board oversight and executive staff responsibilities, outlining how boards can guide CEO hiring, compensation, workplace policies and employee accountability while empowering leadership to manage day-to-day talent decisions.
When determining the role of the board of directors in matters relating to human resources, it is critical to recognize and respect the difference between governance and management.
This seemingly innocuous difference is often sticky for nonprofit organizations both large and small. Questions we often encounter include, should the board approve all salaries, or just that of the chief executive? Should a board member be permitted to give feedback to the chief executive about a subordinate’s performance? If a staff member has a grievance, should he go to the board?
How can the board’s finance committee be helpful in hiring a director of finance without usurping the hiring responsibilities of the executive staff? This whitepaper provides insight into best practices for boards when it comes to matters of human resources.
Put simply, the chief executive has primary responsibility for hiring and managing the staff, while the board’s role should be focused on governing the organization. The challenge is creating an environment in which the board feels confident that it has a sufficiently meaningful role in driving an organization’s mission forward without interfering with the staff’s ability to manage day-to-day affairs.