Leadership

Time to End Term Limits?

By / Mar 17, 2014 (Lisa Martin/PublicDomainPictures)

Associations overwhelmingly prefer term limits for board members. But do limits force out talented members too soon?

We write a lot here—on this particular blog, but also throughout AssociationsNow.com—about the importance of bringing fresh ideas to your organization. Without question, there’s something in your staff, your membership and leadership structure, your revenue model, and your meetings that can use a fresh look.

But perhaps there’s a case for keeping some things in place. Like hanging on to long-term board members instead of term-limiting them out.

“Imposing formal term limits will have the unfortunate effect of forcing out board members who continue to contribute at a high level.”

That’s not standard practice: According to Beth Gazley’s 2013 ASAE Foundation book, What Makes High-Performing Boards?, 89 percent of associations have a policy on term lengths. There’s a little flexibility within that: 27 percent of organizations have a stated policy of no term limits or require a break between terms. But by and large, boards are structured to bring in fresh blood and, hopefully, fresh ideas.

There’s a downside to that structure, though: The potential disappearance of institutional memory, inconsistent engagement, or just the loss of a very smart and dynamic board member. That’s an argument that Kim Jonker and William F. Meehan III made recently at the Stanford Social Innovation Review. Their article, “A Better Board Will Make You Better,” is largely a familiar and common-sense run-through of what makes boards successful. But midway through, they toss a curve:

In general, we believe in limiting terms—but not in term limits. Each year, board members should evaluate their own, and each other’s, commitment to their organization. And they should be ready to hold candid conversations with non-contributing or disruptive members. To be sure, it’s difficult and uncomfortable to ask a fellow board member to step aside. Yet a governance committee is supposed to do just that. The alternative of imposing formal term limits will have the unfortunate effect of forcing out board members who continue to contribute at a high level. In fact, many of the best nonprofits have two or three board members who maintain their passion for an organization for a couple decades or more.

To put it a little more bluntly: Instead of creating a structure that forces out good board members, cultivate a culture that helps poorly performing ones find the door. And instead of having CEOs and nomination committees perpetually wring their hands over finding new talent, you can cultivate good work out of the group you have.

Jonker and Meehan raise an important point about the need for candor within boards, CEOs are skeptical about removing term limits. According to Gazley’s research only 2 percent of organizations that limit service to one term say they have more turnover than optimal, while the rate for those with no limits is 8 percent. And twenty-five percent of respondents with no term limits say they have less turnover than optimal—much more sizable than the 5 percent at one-term organizations.

Glenn Tecker, CEO of Tecker International, sees risks in dispensing with term limits. “Removing a disruptive board member could raise issues as to whether removal was for disruption or repeated passionate disagreement,” he writes in an email. “My experience suggests that a good partnership between the CEO and chair and a clear board majority that supports removal can usually ‘convince’ the offender to resign for face saving reasons the offender can select.” Moreover, he says, the removal of a board member who has plenty of advocates can create fractures that are difficult to repair.

As for whether removing term limits would make finding talent less of a struggle, Tecker writes, “If a board can’t find new talent with fresh ideas who are interested in serving, the organization has a bigger and deeper problem.”

In an email, Meehan supported a less rigorous approach to term limits, but advised caution. Association boards “can benefit from a very few experienced long generous board members as well as the vigorous governance committee no terms limits require,” he writes. “Term limits throw the baby out with the bathwater.  No term limits without an aggressive governance committee leads to swampy bathwater.”

Does your organization allow board members to serve indefinitely, or with only slight restrictions? What makes such a structure succeed? Share your thoughts in the comments.

Mark Athitakis

Mark Athitakis, a contributing editor for Associations Now, has written on nonprofits, the arts, and leadership for a variety of publications. He is a coauthor of The Dumbest Moments in Business History and hopes you never qualify for the sequel. More »

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