This Handbook highlights eight factors as well as the insights and recommendations to build an effective non-profit board based on evidence from the Board Leadership Study 2019/20..
The Centre for Non-Profit Leadership (CNPL), part of the National Volunteer & Philanthropy Centre (NVPC), is proud to launch the findings of Board Leadership Study 2019/20 (BLS) in partnership with Deloitte. Two years in the making, the study presents findings from a nationally-representative sample of Board Chairs, Executive Directors and Chief Executive Officers from 360 non-profit organisations (NPOs) across various sectors. It is supplemented by in-depth qualitative interviews with some of these leaders
The trust bestowed upon Charities by the public, beneficiaries and donors and other stakeholders is like oxygen. Without this trust, charities cannot effectively perform their missions. In difficult times when needs are greater and stakes and scrutiny higher, effective board leadership is crucial.Ms. Melissa Kwee, Chief Executive Officer, National Volunteer & Philanthropy Centre
The Board has always had a strategic role, acting as the ultimate stewardship body of the organisation, to guide and provide direction for the future. What is new in our current context is the emergence of topics such as climate change, digital transformation and evolving societal expectations. For non-profits, it is important to strengthen the purpose of the organisation, and stay long-term oriented. During times of crisis, it is a good test on the soundness of the Board and how it steers the organisation to emerge from the crisis stronger and more resilient. The ability of the Board to tap on its members’ diverse strengths, so as to supervise and advise Management on key matters, is therefore crucial in enabling the Board to fulfill its role.Ms. Seah Gek Choo, Southeast Asia and Singapore Leader of Deloitte’s Centre for Corporate Governance
Key Insights From The Board Leadership Study 2019/20
These insights as well as other data from the BLS study formed the framework and recommendations found in Handbook that can be used by NPO leaders to improve their board effectiveness.
1. Value-based leadership is key
Having leaders with the right values and motivations directly impacts the effectiveness of NPO boards. Across various factors measured in the study, NPO boards performed best on ‘Aligned Values and Motivations’, with 91 per cent of NPO leaders agreeing to this assessment of their board. Being aligned in values and motivations encompasses traits such as acting in the charities’ best interests, being passionate for the cause, and more.
2. Stronger governance deepens trust
The BLS study found governance and compliance among NPOs to be increasingly stronger over the past four years, with a four-fold increase in the formalisation of board renewal plans between 2016 and 2020. With more NPOs disclosing board-related information on their annual reports, this progressive trend towards stronger governance and accountability would help to inspire public trust in the non-profit sector.
3. NPOs can improve on self-evaluation
22 per cent of NPOs identify self-evaluation as the most important attribute relating to governance and compliance. However, there is a gap between perceived importance and performance. The surveyed NPO leaders rate their conduct of self-evaluation to be one of the lowest among all other attributes contributing to board effectiveness – 70 per cent compared to the average of 81 per cent. This signals a pressing need for an accessible tool for NPOs to take stock of their own board health.
Stay tuned for PulseCheck 360 which will be launched later this year by CNPL. PulseCheck 360 will be a refreshed online self-evaluation platform that offers NPOs tangible working recommendations to navigate their future.
4. Engage stakeholders with clear communication
The COVID-19 situation has made it necessary for NPOs to work creatively and closely with their donors, volunteers, beneficiaries and other NPOs and partners. Through clear communication, NPOs can tackle their work despite greater limitations in this climate of uncertainty. Only 28 per cent of NPO leaders surveyed have formalised an external stakeholder engagement plan, suggesting an avenue for improvement.
Bringing It All Together: The Effective Non-Profit Board Framework
At the heart of the study is the question of what makes an effective board?
CNPL is proud to introduce the Effective Non-Profit Board Framework, the first comprehensively researched framework in Singapore backed by a national study of NPO boards across sectors. It identifies 3 levels and 8 factors that influence Non-Profit Board Effectiveness.
The Framework was done in discussion with the Charities Unit, Non-Profit Leaders, Tote Board and the National Council of Social Service. We are also grateful to have journeyed with other sector partners such as the National Arts Council, Sports Singapore, Ministry of Social and Family Development, Ministry of Health, People’s Association, Ministry of Education, as well as the Singapore Institute of Director and Council for Board Diversity, who provided critical input to the findings.
To bring this Framework to life, we have put together a Handbook that extensively fleshes out the Framework in detail. Each factor comes with dedicated sections that deep dive into concrete developmental plans, how the factor is practised in reality as well as tips and resources for Boards who want to get started right away. There is even a helpful checklist for each factor to help you identify current gaps in your Board practices.
For more information, click the “download” button below for your free copy of the handbook.