BOOK REVIEWS

The Big Board Theory Hawey Newman

Governing Boards: Their Nature and Nurture, by Cyril 0. Houle. San Francisco: Jossey-Bass, 1989. 248 pp., 821.95 cloth.

ENERALLY? I am not a fan of books about boards of nonprofit organizations. There are lots of them, and they are remark- G ably similar. First of all, they tend to be how-to or everything-

you-ever-wanted-to-how-about books. They are prescriptive and didactic. They assume an implicit virtue in the subject (and often the task). They analyze little, assume much, and frequently are supercil- ious. They are of little use to scholars, and many board trainees find them unreadable.

Second, these books attempt to be self-fulfilling, written as if to say, “If you read these books, you will become a good board member, whether you like it or not.” They seem to be intended for a self- selected elite, often “born to the task.” Third, they are not thoughtful about the concept of boards of nonprofits, particularly concerning the question, ‘Why boards?”

And finally, one book contains much of the same material found in the others. Central to these volumes are the nine to twelve func- tions of the board, and sections are included on the structure of the board, the operation of the board, and the relationship between the executive and the board. Often, the appendix includes case studies or samples of by-laws.

I was pleasantly surprised, however, by Cyril 0. Houle’s book Governing Boards, a publication of the National Center for Nonprofit Boards. Although the book confirmed to a certain extent my previous experience with books on this subject, Governing Boards proved to be more thoughtful than most, neither didactic nor supercilious. It ques- tions some basic assumptions, and is directed at scholars and stu- dents, not just board trainees. The book is like an old friend in the familiarity and gentle provocativeness of its style and substance.

Houle presents some historical perspective on the subject of boards, but he does not generally consider key developments in the context of their time and location. The thirteenth-century volunteers of the Misericordia served a new and important function in their

OJosscy-Bass Inc.. Publishers 187 Nmnom hhummvr 67 humm. VOL 1. no. 2. Winter 1990

188 N E W M A N

time and place, but how does it illuminate the twenty-first-century need for and activity of nonprofit boards and volunteers? What was the evolution of nonprofits from the first half of the twentieth century to the latter part of the century, and what was the impact on boards? These questions need to be answered to prepare for the board needs of the twenty-first century.

A theme that threads throughout Governing Boards is the notion that boards operate within the context of a tripartite system endemic to nonprofits. Activities of nonprofits are divided into the familiar “staff-executive-board pattern” or “the work to be done, the adminis- tration of that work, and the establishment of policies to guide it.“ Size alone moves a board from one which fulfills all three levels of the system (small organizations) to one which operates exclusively in the realm of policies and the selection of the administrator (large organi- zations). A soon-to-be-published study of over 13,000 nonprofits in New York City indicates that the median staff size is one staff person, and the mean is about twenty-three. Here is an indication that there is a need to understand the boards of small nonprofits, those that operate on all three levels of the tripartite system, and not just con- tinue to promulgate only the “big board” theories.

A list of eleven board functions is cited by Houle; these are remarkably similar to Brian OConnell’s twelve functions in The Board Member’s Book (1985). But Houle’s list is somewhat more concise, and it provokes thought in its exposition; OConnell and others tend to restrict thought by their prescriptive and unwavering nature. Houle’s list of functions includes:

1. Keep the overall mission in focus 2. Approve and revise long-range plans 3. Assure that objectives are being achieved 4. Select the executive 5. Work closely and interactively with the executive 6. Serve as arbiter in conflicts between staff members and between

staff and executive (I am not sure how they maintain their objec- tivity if they are successful in working closely and interactively with the executive)

7. Establish board policies governing the program 8. Assure fulfillment of basic legal and ethical responsibilities 9. Accept responsibility for securing and managing adequate finan-

10. Assure that the organization is integrated with its environment 1 1. Appraise itself regularly.

cial resources

I recently heard a story about a retired executive director of a nonprofit organization. Eight years after his retirement, the organiza- tion’s board brought him on to help raise funds. They supplied him with an office and a full-time secretary. Because he was retired, or so it was rationalized, he reported directly to the board. Although his

B I G BOARD THEORY 189

relations with the board were good, they twice turned down his request for an additional secretary. He was successful in maintaining the gifts of long-time contributors but brought in little in the way of gifts from new ones.

After three years of actual deficits and the upcoming annual budget projecting another large deficit, the current executive director suggested a less expensive office for the retired executive and reduced his secretary to half-time-seemingly a modest proposal when active staff were faced with significant elimination of positions and major reductions of other than personal services. The retired executive then went to the board and requested retention of his office and, in light of the financial emergency, an increase to two full-time secretaries. The board reinstated his office, but only restored one full-time secretary.

The board activities in this example do not seem to support any of Houle’s recommended functions. These activities neither keep the overall mission in focus, support long-range plans or the achievement of objectives, work with the current executive, assure fulfillment of the ethicaI responsibilities, accept responsibility for securing financial resources, assure integration with the environment, nor even assure self-appraisal. To the contrary, the board acted to promote poor man- agement, overly personalize the process of management, and com- pletely undermine the current executive. Could this be a unique example of board functioning?

Knowing the functions and responsibilities of boards often does not improve the situation, Few of the tomes on boards illustrate how to work with poorly functioning boards. How do you get them to act responsibly? How do you fire a board member? Little equity exists in a partnership in which only one partner, the executive, can be fired. Contrary to the usual simplistic notion presented in books which idealize the board, Houle does raise these issues and describes some alternative views of the relation between the executive and the board. He describes the dominant executive, the dominant board, the divided board, cronyism and antagonism, and the dual executive. In the latter he recognizes the formal and informal ways two persons are charged with executive responsibility and the problems it can create for the organization.

The Center for Nonprofit Boards should be lauded for Houle’s contribution to the literature on nonprofit boards. As good as it is, though, at least in contrast to the plethora of board-training hand- books, it too has not fully discussed some assumptions that Middleton (1987) says are not supported by reality. The assumptions she cites are worth repeating: (1) nonprofit boards are policy-making, goal- evaluating organizational units; (2) nonprofit boards are noisy con- stituent boards, characterized by bargaining behavior; and (3) the board-management relationship is a parmership built on mutual trust and effective communication.

Middleton says these assumptions are untrue; my experience

How do you get the bomd to a t

responsibb? H~ do you fire a

board member?

190 N E W M A N

says the same. Houle begins to confront these assumptions, but until they are confionted directly and completely, we will not be able to develop boards for the future. Until then, we will be mired in the muck of manuals for board trances and wiI1 see some dim light, as in Governing Boards, only occasionally.

HARvEl’ N m is director of public policy at United Jewish Appeal/ Federation ofJewish Philanthropy in New York C q .

References Middleton, M. “Nonprofit Boards

of Directors: Beyond the Gov- ernance Function.” In W. W. Powell (ed.), f i e Nonprofit Sec- tor A Research Handbook New Haven, Conn.: Yale University Press, 1987.

OConnell, B. The Board Mem- ber’s Book. New York Founda- tion Center, 1985.