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Why Boards Need Rotation
Here at Canaan Group & Associates, we put a significant emphasis on having a healthy board of directors. There are a lot of steps involved in creating and developing a board, but for right now, we want to emphasize board rotation and why it’s important for your organization.
What It Is
So, what exactly is a board rotation? Just like how our government requires a change of power after a certain number of years, the same idea is implemented in board rotation.
The organization decides how many years are in a term. Board members may serve for two years, three years, or whatever your organization deems necessary and practical, rotating out after the allotted years.
Why Rotate Your Board Members?
Changing out board members every couple of years seems incredibly tedious and unnecessary to a lot of organizations, but that constant rotation can grow and benefit the organization in ways that far outweigh the extra bits of work.
For one, following a rotation schedule helps build a positive perception of your organization. When outside clients see a well-rounded board with diverse giftings, it builds trust and confidence. A member’s presence on your board impacts how your organization is perceived no matter how long he or she is on the board.
Not only is rotating board members effective for building positive perception, but it is also crucial in difficult situations. There will come times when a board member may prove ineffective in his or her position or make a compromising decision. When terms are already in place, there is an effective way of dealing with situations that otherwise could cause unnecessary disruption.
Just like in our government, power has the tendency to corrupt, and (on a less dramatic note), permanence can lead to blindness and/or apathy. Think of a rotation schedule as a refresh that also creates a healthy amount of accountability and boundaries.
On a more positive note, board rotations allow you to bring in new voices and broaden your organization’s close partners. Assuming a board member’s term ends well, he or she will likely continue championing your organization and partnering in other ways. Meanwhile, the person taking his or her seat brings in a fresh perspective and another network of potential partners. After many rotations, your organization’s partner base will be much larger than if you’d kept the same ten people for 25 years.
Do You Have or Need Term Limits?
As you look to build a board, consider these questions: Do we have or need term limits? Do we have term limits but don't hold to them? Is this something that our company wants to incorporate? If so, how are we going to create terms that best suit our organization?
For the health of the organization, rotation and recruitment should be on the mind of each board member. As we say at CG&A, one of the most important jobs of a board member is to replace themselves.
We hope that you’re now encouraged to create the best possible environment for your board and your organization to thrive.
At CG&A, we believe that culture and giving happens from the inside out. Contact us to talk more about how healthy board governance and rotation is essential to the health of your organization.