Report: Boards Need More Time for Strategy

Nonprofit and public-sector boards are feeling increasing pressure to respond to more rapid changes, according to a new report, but few board members describe themselves as forward-looking.

Governance Outlook 2027 for Mission-Driven Organizations  (opens in a new tab), released earlier this month by the Diligent Institute, a governance-research of the technology firm Diligent, is based on a survey of 230 board members and staff leaders of nonprofit and public-sector organizations. 

Most strikingly, only 11 percent of respondents describe their board meetings as “forward-looking,” and 32 percent describe them as retrospective. The remainder describe their meetings as “balanced,” but that term is somewhat misleading, said Kira Ciccarelli, senior manager of research and programs at the Diligent Institute.

“Once you dig a little bit deeper and talk to board members about what they want that balance to look like, the vast majority of them say they want to be more forward-looking,” Ciccarelli said.

Standing in the way of a forward-looking approach, the survey found, are challenges around board structure and technology. Forty-three percent of respondents said they do no scenario planning during board meetings, and nearly half (49 percent) say they want more time for strategic planning at meetings. Though AI-based risk analysis tools might help streamline their processes, few use them. According to the report, only “14 percent said their board uses AI regularly alongside traditional approaches…and only one respondent reported that AI is fully embedded in oversight and strategic decision making.”

The need for risk analysis is acute, according to the report, because respondents are signaling that financial stability is top-of-mind for them. The most common organizational priorities relate to costs and funding, and 45 percent of respondents cited “budget allocation/fiscal management” as their most challenging issue to oversee. 

That new urgency, Ciccarelli said, has many organizations asking if their current structure is fit for purpose. “There’s an overwhelming amount and volume of information that they have to get through, and it’s a little bit harder for the board meeting structure to catch up,” she said. “I think some of the reasons for that is just this is the way that the board meeting has always been structured. Typically they’re used to getting readouts, and there hasn’t been as much need for that forward-looking conversation. But things are just moving a lot more rapidly now.”

Given that, substantial numbers of respondents are looking for more data about the organization than can be summarized in a quarterly board meeting. Slightly more than half (55 percent) of respondents say they receive real-time performance data between meetings, but 38 percent said a key improvement to the board would be “more frequent and structured risk discussions at the full-board level.” 

That includes more access to outside expertise, Ciccarelli said. “Boards are reflecting inward and saying that part of overseeing strategy effectively, overseeing AI risk effectively, and managing financial uncertainty is making sure that we have the right people in place,” she said. “When you ask the respondents what would help them oversee these issues more effectively, what would help improve your governance processes, that’s another area where you see them say, ‘We would like to speak to more outside experts about topics that we don’t know as much about.’”

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