THE FIDUCIARY RESPONSIBILITY OF A COUNCIL EXECUTIVE BOARD OF THE BOY SCOUTS OF AMERICA
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- Elisabeth Chambers
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1 THE FIDUCIARY RESPONSIBILITY OF A COUNCIL EXECUTIVE BOARD OF THE BOY SCOUTS OF AMERICA CHARACTER INTEGRITY SERVICE
2 Funding a Council in the 21st Century If we turned the clock back 20 years, we would see that the funding model of a Boy Scouts of America council looked very different from today s model. General operating support tended to be more stable and predictable two decades ago. Societal shifts have changed the way we raise funds. In Scouting, our philosophy has always been that people give to people and not to councils. Most funders now have predetermined areas of focus and have established committees to determine which charitable organizations they will fund. Additionally, many funders have shifted from donating to organizations and instead are funding specific issues or causes. Technology has changed fundraising practices as well. Scouting s preferred person to person model is becoming a challenge in today s world. Most funding requests are now handled online without any human contact. The fundraising role of the professional has also changed. Rather than simply overseeing fundraising efforts as the campaign manager, today s Scouting professional serves as an active member of the fundraising team. Unfortunately, a district executive, development director, or Scout executive can only be successful if he or she has enough of the right volunteers helping to open doors and spread the good news of Scouting. Today more than ever, the council s executive board must lead the way and establish an accountable fundraising, governance, and asset management model that meets the needs of the community the board serves. Board members must be eager to use their professional skills to help oversee the council, but they must understand that their main role is to focus on strategic issues while the staff handles managerial concerns. Today more than ever, it is critical that board members identify new sources of revenue. This guide has been designed to assist local councils in defining fundraising roles and responsibilities and to assist in the establishment of a funding model that will help every council achieve its objectives.
3 What are board members roles and responsibilities in funding a council? How can and should they be involved? Board members specific roles vary from one council to the next, depending on the council s needs and structure. There is an expectation that as a board member, you will play some role in fundraising. Board members should be actively involved in the creation and implementation of the overall development plan. You can be one of the best resources in terms of making introductions, and many times your personal business expertise will be useful in developing a sound plan. The specific role the board will play is a key part of the development plan. Your council may already have a board fundraising policy which clearly defines the expectation of board members in fundraising. This policy establishes the amount each director is expected to give and/or get, the process for waiving or reducing the requirement, additional expectations (such as captaining a table at an annual dinner), and the range of ways in which board members can support fundraising. In addition to committing funds, here are a few other ways you can be involved as a board member: Identify new prospects and opportunities for fundraising. Identify and cultivate high net worth donors. Sell tickets to an annual dinner or event. Make introductions to potential donors and corporate sponsors. Host special meetings or events. Accompany the Scout executive to key meetings with potential donors. Many boards spend considerable time defining board members roles in securing adequate resources for the organization. Personal contribution is an essential part of that discussion. Each board should determine its own personal giving policy. If board members are expected to contribute funds, the target should be 100 percent board member participation. Why should a board member give? Board member giving is natural and necessary. Here are some rationales: Board members of most charitable organizations are expected to participate in fundraising. An appeal is particularly convincing if a board member serves as an example for giving. The board is responsible for providing a sound financial basis for the council. By personally contributing, a board member recognizes this responsibility and demonstrates a commitment. Nearly 90 percent of American households contribute to charities. Board members should designate the council they serve as the main recipient of their generosity. Many foundations only contribute to organizations where every board member is a contributor.
4 Council giving policy The board must draft a fundraising and personal giving policy. A strong leader during the decisionmaking process a sensitive peer who is in a good position to make the case can help find a consensus among board members. As the decision affects each board member individually, it is necessary to create a policy that can be enforced. To avoid misunderstandings and false expectations, every board candidate should be familiar with these policies. How much is enough? It is probably not a good idea to ask each board member to make an equal contribution. Some board candidates might find the amount too high; therefore the policy would eliminate valuable prospects from joining the board. Others may have considered contributing more, but a lower suggested amount could change their minds. The policy could set a range, suggest a minimum amount, and/or encourage each member to give at a meaningful level according to his or her capacity. One set of guidelines may not be appropriate for every board. Additional options Some boards tie fundraising and personal giving closely together: Individual board members raise funds or make personal contributions or combine these two. They could provide financial support by purchasing special event or auction tickets or by donating items to an auction or a sale. The board should determine what is appropriate. We would hope that board members would make Scouting one of their top three philanthropic interests. What are the basic responsibilities of nonprofit boards? 1. Establish a strategic plan. It is the board s responsibility to establish a strategic plan that articulates the council s goals, means, and primary constituents served. 2. Select the Scout executive. Boards must reach consensus on the Scout executive s responsibilities and undertake a careful search to find the most qualified individual for the position. 3. Support and evaluate the Scout executive. The board should ensure that the Scout executive has the moral and professional support he or she needs to further the goals of the council. 4. Ensure effective planning. Boards must actively participate in an overall planning process and assist in implementing and monitoring the plan s goals. 5. Monitor and strengthen programs and services. The board s responsibility is to determine which programs are consistent with the council s mission and monitor the effectiveness of its programs and services. 6. Ensure adequate financial resources. One of the board s foremost responsibilities is to secure adequate resources that will allow the council to fulfill its mission. 7. Protect assets and provide proper financial oversight. The board must assist in developing the annual budget and ensuring that proper financial controls are in place. 8. Build a competent board. All boards have a responsibility to articulate prerequisites for candidates, orient new members, and periodically and comprehensively evaluate members performance. 9. Ensure legal and ethical integrity. The board is ultimately responsible for adherence to legal standards and ethical norms. 10. Enhance the public standing of the council and of Scouting. The board should clearly articulate the council s mission, accomplishments, and goals to the public and garner support from the community.
5 What are the legal responsibilities of nonprofit boards?[hdm1] According to BoardSource, a consulting firm for nonprofits, board members must adhere to wellestablished principles of nonprofit corporation law that define certain standards of conduct and attention in carrying out the various responsibilities to the organization. Several states have statutes adopting some variation of the duties which would be used in court to determine whether a board member acted improperly. These standards can be described as the Three D s: the duty of care, the duty of loyalty, and the duty of obedience. Duty of care The duty of care describes the level of competence that is expected of a board member, and is commonly expressed as the duty of care that an ordinarily prudent person would exercise in a like position and under similar circumstances. In other words, a board member is obligated to the organization he or she serves to exercise reasonable care when making a decision while serving as the organization s steward. Duty of loyalty A board member must give undivided allegiance when making decisions affecting the organization. This means that a board member can never use information obtained as a member for personal gain, and must act in the best interests of the organization. Duty of obedience The duty of obedience requires board members to adhere to the organization s mission. They are not permitted to act in a way that is inconsistent with the central goals of the organization. A basis for this rule lies in the public s trust that the organization will manage donated funds in a way that fulfills the organization s mission. What are the responsibilities of individual board members? Attend all board and committee meetings and functions such as special events. Be informed about the council s mission, services, policies, and programs. Review agenda and supporting materials prior to board and committee meetings. Serve on committees or task forces, and offer to take on special assignments. Put Scouting in the top three philanthropic choice. Inform others about Scouting in general and the council specifically. Suggest possible nominees to the board who can make significant contributions to the work of the board and the council. Keep up to date on developments related to Scouting. Follow conflict of interest and confidentiality policies. Refrain from making special requests of the staff. Assist the board in carrying out its fiduciary responsibilities, such as reviewing the council s annual financial statements. Delineating roles and responsibilities One of the causes for discord in many councils is confusion over fundraising roles. Who is actually responsible for bringing in grants and donations, and who determines the overall fundraising strategy and policies? What tasks belong to the staff, and what duties are carried out by the board? Without a true understanding of fundraising as part of the overall financial plan and without appropriate division of labor, it is difficult to secure a strong fiscal base for the council. The board and Scout executive need to be on the same page on this issue.
6 Development committee Many boards today look at development as a process, the end result of which is successful fundraising. This concept allows the organization to take a totally new approach to development committees. The committee should be comprised of board members and non board members who work closely with the Scout executive and the executive board to assure adequate financial resources. In addition, boards may want to form their own fundraising committees or task forces as the need arises. As every board is responsible for overall policy formation, this task force can take the lead in drafting the necessary organizational fund development policies. If the board decides that each board member needs to be individually engaged in fundraising efforts, this task force can serve as a boardlevel motivator. Scout executive The Scout executive has a key role in fundraising. Working in partnership with the development staff and the board, he or she acts as the primary representative of the council. The Scout executive tends to spend a significant amount of time on cultivation of major funders and public relations in general. Sometimes the board hires the Scout executive mainly to raise funds to let itself off the hook. This is an unfair and unrealistic demand. Fundraising is always a team effort. Division of duties must be clearly defined. Development staff When a council is able to hire a professional development staff development director, grant writers, planned giving experts, or other specialized development consultants it also has the opportunity to diversify its fundraising efforts. The development director usually is the coordinator of the overall fundraising plan. He or she finds the best way to take advantage of the Scout executive s persona, to collaborate with the board to utilize the contacts that board members bring with them, and to hire and supervise the rest of the development staff. Other resources available to assist you Financially sustainable council plans Review current financial positions and recommended fundraising and fiscal management best practices. Governance reviews Review current and recommended leading edge governance best practices. Board orientation and development retreats Coaching in Board development, council governance, and board diversity To access any of these services and resources, please contact your area director. BoardSource is a tremendous resource and can be found at
7 Recommended Reading Material The Ultimate Board Members Book: A 1 Hour Guide to Understanding and fulfilling your role and responsibilities by Kay Sprinkle Grace Asking: A 59 minute guide to Everything Board Members, volunteers and staff Must know to secure the gift by Jerold Panas The 11 Questions Every Donor Asks and the Answers All Donors Crave by Harvey McKinnon Boardroom Verities by Jerold Panas The Artful Journey: Cultivating and Soliciting the Major Gift by William T. Sturdivant Some material used with permission from BoardSource is the premier resource for practical information, tools, and training for board members and chief executives of nonprofit organizations worldwide. For more information about BoardSource, visit or call BoardSource Content may not be reproduced or used for any purpose other than that which is specifically requested without written permission from BoardSource.
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