Perspectives on Executive Committees
Should a nonprofit board have an executive committee?
A board may form an executive committee to act on its behalf when a full board meeting is not possible or necessary. An executive committee can be an efficient tool but not every board needs one. An executive committee should never replace the full board.
Here are some situations that might warrant using an executive committee:
- You have a large board. A smaller group authorized to act on its behalf in certain circumstances can speed up decision making.
- Your board members are scattered all over the country. It is easier for a core group to get together during an emergency.
- Your board regularly needs to take action or make frequent decisions. Certain financial and legal matters do not require full board meetings. When necessary, an executive committee can efficiently move things forward.
It is important to remember that, even though your executive committee may be granted special powers in the bylaws, the full board should always validate decision in its next meeting.
It is important for all board members and volunteers to understand both the challenges and benefits of working with a board. An executive committee can be difficult to understand - and to keep under control. An Executive Committee recognizes the potential for an executive committee to cause unrest on the board, and provides suggestions on how to avoid possible conflict. This resource assures readers that, despite risks involved, an executive committee is an asset due to its understood authority in emergency situations of the board and its unique relationship with the chief executive.
Each board should determine whether it needs an executive committee or not. An executive committee is a special committee because it can act on behalf of the full board in specific situations. An executive committee may be useful for organizations with very large boards, boards with members scattered throughout the country or the world, boards that must make frequent decisions, or boards that want a place to test controversial ideas. For boards that are small, active, and involved, an executive committee may not be necessary. In order to prevent abuses by the executive committee and keep all board members involved, the role of the committee should be defined in the bylaws, the committee should not replace the full board, and decisions by the executive committee should be later approved by the full board.
Executive Committee
This committee is characteristically on-going. It oversees the organization generally, and particularly direction of staff, between full board meetings, and normally has the capacity to bind the corporation. Members of the executive committee should also be members of the appointing board.
When deciding on the composition of the executive committee, the board should try to:
- obtain the range of skills necessary for the committee to carry out its functions;
- achieve a diversity of membership that adequately represents appropriate geographical areas or constituencies; and,
- allow for frequent meetings at low cost (this typically means either ensuring geographic proximity of members or making provisions for electronic participation in meetings).
The full board should be briefed on decisions made and actions taken by the executive committee at the earliest possible opportunity. In some cases, the executive committee may want to make an interim decision on a matter, which is effective only until the full board considers the matter. If the executive committee has any doubt about its authority to deal with a matter, it should seek legal advice on the scope of its power and/or refer the matter for consideration either by the full board or by the membership, as appropriate.
Procedures
The procedural formality used in committees can vary enormously. A key advantage of committees is that they have fewer participants and more flexibility in their proceedings. This allows for more efficient processing of information and quicker decision making.
Directors should be aware, however, that delegating responsibility to a committee does not necessarily protect them from liability arising from committee decisions or actions. In practice, directors should always ensure that they have access to committee minutes and records. They are legally entitled to any such material.
The legitimacy of committee meetings, like other meetings, can be challenged if its members have not been afforded procedural fairness. Even where the committee operates very informally, there should be provision for:
- notice of meetings;
- adherence to quorum requirements;
- certainty as to the subject matter under consideration;
- availability of minutes and records for review; and,
- opportunity to record dissent.
In many cases, these procedures do not have to be committed to writing. However, board and committee members should always be mindful of them. If the procedure is recorded somewhere, this will save having to refer the matter to the full board or having to institute more formal policies should a dispute occur.
Precisely how much oversight the full board should exercise over a committee depends on the amount of power and the scope of subject matter that it gives to the committee. It may also depend on whether the committee is composed solely of board members or includes outsiders. For instance, there is minimal need for a board to supervise the procedures of an advisory board. But if a committee is empowered to bind the corporation, then the board should make sure that there are procedural safeguards in place. These include:
- careful vetting of candidates for committee membership (any possible hidden agendas or potential personality conflicts?);
- the board retaining the right to designate the committee chair;
- regular or occasional review of the committee minutes and records; and,
- annual, or more frequent, reporting by the committee to the full board.
Committees can inform the full board of their work through minutes, oral or written reports, or recommendations. Minutes are typically submitted so that the board can monitor the functioning of the committee. Reports may or may not contain recommendations. If they do, the recommendations should be listed at the conclusion of the report. If the report is being considered as part of the agenda of a board meeting, there is no need to pass a motion to 'receive' it.4 In rare instances, a board may wish to 'adopt', 'accept' or 'agree to' a report. This means that the board concurs not only with the findings contained in the report, but also with the deliberations of the committee as set out in the report. It is very unusual for a board to want to endorse a report in this manner. Not having partaken in the work, board members are unlikely to want to concur with all its nuances.
Instead, the board should address its attention to the recommendations, presented either as part of the report or separately. It can vote to implement the recommendations or to take other measures with regard to them that it deems appropriate - including, for instance, rejecting them or returning them to the committee for reconsideration.