The executive session, a meeting of the board without staff present, provides the opportunity for the board to have frank, confidential discussions and exercise its independence from staff. It’s a powerful tool to strengthen the board’s sense of itself as a governing body, but most nonprofit boards only meet in full executive session for an annual discussion about the chief executive’s performance review. There are additional topics that benefit from discussion limited to board members: some of these are linked to the board’s oversight responsibilities, others are connected to the board’s ability to manage itself and work together as a cohesive team.
The Annual Meeting with the Auditor
The board is responsible for the organization’s financial audit. Therefore, the auditor should be selected by, and report to, the board. Before it votes to accept the audit, the board should meet in executive session to receive the auditor’s report. This allows the board to have a more open discussion about organization’s financial practices than it might have with staff present. From this session, the board may develop ideas for changes in the organization’s financial procedures to later discuss with staff in a board meeting.
The board is responsible for managing itself, but too often, this responsibility is ceded to the chief executive. Executive sessions allow the board to candidly assess its own performance. Discussions can provide feedback to board leadership without calling their authority into question in front of staff members. These meetings provide the opportunity to address board member conflicts or poor meeting behavior. Executive sessions allow the board to have more frank and detailed discussions about board member prospects and recruitment.
Executive sessions also allow the board to engage in independent thought and conversation about organizational issues without the influence of the chief executive. Members may feel more comfortable exploring ideas when they aren’t concerned about looking naïve or raising perspectives that may upset staff. These conversations can help build board member engagement and strengthen board cohesiveness.
Most boards are accustomed to holding executive sessions to discuss the chief executive’s performance review and compile the board’s official review document. If there are concerns about performance outside of the annual review cycle, it’s appropriate to first discuss these in an executive session, rather than in more informal discussions among board members. If concerns are widely shared and substantiated, the board should then have a conversation with the chief executive to address these.
Executive sessions are also an appropriate setting for discussions about other staff issues such as compensation levels and succession planning. This helps the board determine its approach for future discussions with staff on these topics.
Handling Executive Sessions Appropriately
Because executive sessions are relatively unusual, holding them more regularly can cause some initial concern for staff. Therefore, it’s important to develop procedures to ensure that using these sessions does not drive a wedge of mistrust between the board and the staff. Initially, the board may want to use any executive sessions beyond the annual performance review meeting to focus specifically on its own performance.
Having policies and procedures for using executive sessions establishes guidelines for their use. Policies should describe how executive sessions are called and conducted. When an executive session is scheduled, it should be noted on the board’s agenda, and should specify who will be participating in the session (e.g., board only, or board with the chief executive). In some cases, the topic of the session can also be noted. This may help reduce speculation and staff concerns.
In the session, the chair is responsible for ensuring the discussion stays on topic. These sessions should never decline into a conversation that rambles from topic to topic or turns into a tirade about staff or organizational performance. Some boards may take detailed minutes of executive session discussions, while others may only note the general substance of the conversation. Any board decisions that result from discussions held in executive session should be ratified in the regular board meeting and recorded in meeting minutes. Most importantly, following the executive session, the chair should follow-up with the chief executive to briefly summarize the session’s discussion. This helps reduce any concern that the chief executive might have about the discussions held executive session.
Executive sessions can help the board develop a stronger sense of itself as a governing body. Board discussions away from staff can help clarify where there are gaps in understanding or support for organizational activities or initiatives. They provide an ideal forum in which to discuss board performance and leadership. Handled carefully, executive sessions can help build the board’s abilities to do its work, thereby strengthening the entire organization.
A version of this post first appeared in the Corridor Business Journal.