Leadership

A Board-CEO Communication Gap

By / Dec 1, 2014 (iStock/Thinkstock)

A new study says a lot of nonprofit executives are planning to depart—and that boards are missing the signals.

Hey, aren’t you gone yet?

A lot of nonprofit leaders are thinking about heading out the door, according to a recent survey by the consultancy Vista Global: 41 percent said they planned to leave their job in the next two years.

The study, bluntly titled “Proactively Plan for the Inevitable: A Guide to Leadership Transition and Succession,” addresses a few themes that I’ve discussed before in this space, including the need for boards to do more to support incoming CEOs and the importance of cultivating future leaders within staff. But the study also raises another issue, somewhat accidentally, that speaks to a concern at associations, whether it’s weathering a leadership change or not.

“Think of leadership transition as an unrecognized liability on your balance sheet.”

Consider a couple of the data points from the study:

While, as I mentioned above, 41 percent of CEOs said they plan to leave in the next two years, 56 percent of the board chairs surveyed said, “The CEO doesn’t plan to leave for a long time.”

While 38 percent of CEOs say their organization doesn’t have a history of leadership transition planning, 68 percent of board chairs say the same thing.

To put it another way: There’s a disconnect between how the CEO perceives the direction of the organization, and how the board perceives it. Or, to further simplify: There’s a communication gap between the board and CEO.

To some extent the gap can be attributed to the way nonprofitdom is structured: The CEO lives the organization’s mission daily, while the board lives it at best monthly and more likely quarterly. Given that, a disconnect is bound to exist. The problem in this case is that the disconnect means the board assumes that volunteer leadership is something that just kind-of-sort-of happens; there’s no plan for change, but that’s OK because the executive isn’t going anywhere. According to study, 62 percent of organizations don’t have a written succession plan, and half don’t see it as a priority.

Solutions? The authors of the study suggest that organizations reconceive the leader’s presence—and potential departure—as a risk item on its balance sheet. “Think of leadership transition as an unrecognized liability on your balance sheet that could put your mission at risk—what would it take to mitigate that liability, and even turn aspects of it into an asset?”

Though that’s a defensive posture—it makes the CEO a potential problem in perpetuity—it does at least prompt leadership on both sides to have a more candid conversation about the future of the organization. More practically, Vista Global suggests that “boards should include emergency and longer-term succession planning in every CEO’s work plan and annual evaluation.”

That would be a sizable leap from the way many association leaders say their annual evaluations go—where so long as the revenues are in line and nobody’s making a total hash of the strategic plan, the board is comfortable letting things go along as they have. “Performance measurement doesn’t measure performance,” as Paul Pomerantz, FASAE, CAE, once put it.

The Vista Global study includes some useful recommendations for leaders during the executive onboarding and offboarding process. But it’s the in-between process that can be just as critical. Nancy Green, FASAE, CAE, says that execs need to step up and cultivate those conversations: “Finding opportunities for conversations with the board more than once a year is critical,” she says. “It provides time to course-correct and mend fences if needed.”

Without that, you’ve cultivated the familiar situation where the board figures things are going just swimmingly—when the executive actually has her eye on the door.

What do you do to cultivate regular conversations between executives and volunteer leaders? Share your experiences 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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