The Nonprofit FAQ
| Do boards ever fire executive directors? If so...how? |
| This discussion is adapted from "Action Handbook for Boards of Directors", by Jan Masaoka, and published by the National Minority AIDS Council and the Support Center for Nonprofit Management, 1995. Imagine this scenario: You're on the board of an organization where some of the board members--including yourself--are increasingly wondering whether your executive director is really up to the job. The Program Director has made some "off-the-record" comments about the executive director to some of the board members. You feel like you need to do something--but you don't want to get into a big battle. It would help if you understood more about whether and how organizations ever fire their executive directors. Sometimes it is necessary for a board to fire the executive director, and a board is to be commended for taking the responsibility of ensuring that the organization has the right CEO. In rare occasions everyone on a board agrees that the executive director should be fired, such as in instances of embezzlement or unethical behavior. But more often, over time board members increasingly get indications that the director is either not doing the job or causing problems for the agency. The prospect of open conflict with the executive director is so dismaying that many board members who are dissatisfied with the director's performance choose instead simply to resign when their terms expire. Dissatisfaction with the executive director often appears first as rumblings, such as a staff member complaining to a board member about morale, or committee members confiding their concerns to one another. Now that such rumblings have appeared, the board should hold an executive session and establish an investigative committee to clarify the content and extent of the dissatisfaction, and determine what general approach is appropriate. If, for example, there are rumors of sexual harassment, the committee (or a consultant) can interview staff and volunteers and determine whether the rumors are frivolous or whether they require a more formal investigation. Or, the committee may find that the executive director simply doesn't understand the approach the board wants to see taken. In such an instance the board may choose to set up a series of meetings with the executive director to clarify directions and improve communication. If you find you have strong reservations about whether the executive director's performance is satisfactory, the board should establish a committee to work more closely with the directory in a supervisory capacity. Beginning with letting the executive director know the extent of dissatisfaction on the board, the committee can document the problems and take steps to improve the director's performance. If performance doesn't improve over time, and the director is fired by the board, the ongoing documentation can help deter a lawsuit against the agency by the former executive director. No level of documentation can guarantee that a lawsuit won't be brought, but an agency holds a stronger position in court and in the community if personnel policies have been followed, if steps have been taken to improve performance, and if those steps are documented as having failed. If, after appropriate investigation and deliberation, a board feels that the executive director should leave the organization, it may choose first to have the board officers approach the director and suggest that a resignation would be welcome. Many executive directors under pressure prefer resignation to being fired, and some board members feel that a resignation leaves the organization in a better light than termination does. Whichever is chosen, board action to terminate or to accept a resignation should be put into the minutes. The board should document whether there is any severance pay, any remaining tasks to be completed by the departing executive director, and close any other financial relationship. The board should develop a straightforward explanation for the resignation which can be communicated to staff, volunteers, funders, and others in the community. Copyright ©1994-95 Support Center, 706 Mission Street, 5th Floor, San Francisco, CA, USA 94103-3113. 415-541-9000. Distribution and reprinting permitted as long as this copyright notice is included. All Rights Reserved. http://supportcenter.org/sf/genie.html On September 29, 1998, Deborah Smith Cohen ([email protected]) wrote to ARNOVA-L in response to a report of a rash of recent terminations of CEOs of nonprofit organizations: I like this book and article which addresses some of the relevant issues in CEO firings: Tecker, Glenn H.; Fidler, Marybeth. Successful Association Leadership: Dimensions of 21st Century Competency for the CEO. American Society of Association Executives http://www.asaenet.org }, Washington, DC, 1993. [Product No. 213552 $29.95 (M); $35.00 (NM)] ABSTRACT: Glenn Tecker, one of the authors of this book, is a frequent ASAE speaker and writer, as well as an association management consultant. The book's premise -- that management communications and relationship skills can make or break an executive's success -- is substantiated by formal research on association executives' management styles and "failure" experiences. The book is based on Tecker Consultants' study of executive competencies, drawing on extensive confidential interviews and the review of more than 600 case studies to identify those competencies most critical to the current and future success of association executives. The book also discusses recent studies that suggest a perception that many association executives spend far too much time attempting to impress their members with improving products and services. The book contains a dozen "exhibits," or graphics, to illustrate the text. Included with the book is a set of full-size worksheets, entitled " Perceptual Self-Assessment: Critical Competencies for Association Executives." The sheets can be used to measure competencies: interpersonal skills, valuing and using technology, acquiring and using information, understanding complex relationships, and deployment of resources. The self-assess also includes a "High-Level Organizational Scan," or organizational productivity model. All of these pages appear in a smaller size in the book itself, in Section III, Self-Appraisal Tools. (162 pp.) Tecker, Glenn H.; Bower, Catherine Downes (CAE) "Why Good Executives Get Fired, Association Management, December, 1992, pp. 32-40. American Society of Association Executives { http://www.asaenet.org }, Washington, DC, 1992. [Product No. 126203 $3.00 (M); $5.00 (NM)] ABSTRACT: This article draws on the authors' research for the ASAE Foundation on reasons why chief executive officers (CEOs) fall out of favor and are fired by their boards. Their article begins by stating 'key principles' underlying the dynamics at work when good executives get fired and goes on to explore three observable symptoms of trouble and four causes of these symptoms. One of the principles is that 'what is perceived to be, is.' The three symptoms are a lack of consensus among leadership about what constitutes success; a situation in which certain internal and external conditions promote dissatisfaction with performance or dismissal; and lack of trust. The authors' research also indicates that three 'contributing conditions' promote dissatisfaction and dismissal, and that they are common to associations that do not maintain clear consensus on what constitutes success. The article also discusses how to define success and four key prevention strategies that good executives can use. The article includes three small sidebars. (7 pp.) The Free Management Library provides additional information. See "Evaluating the Chief Executive" at http://www.mapnp.org/library/boards/boards.htm#anchor210999 See "Hiring / Transitioning to a New Executive" at http://www.mapnp.org/library/boards/ed_xtion.htm See "Firing Employees" at http://www.mapnp.org/library/emp_perf/prf_issu/firing/firing.htm Revised with new materials 10/10/98 -- PB; 8/11/99 -- CM |