Ten questions every board director needs to ask about the board’s director payment policy
Historically, charity and not-for-profit boards have worked for the good of the cause, with no expectation of payment. The world has changed – people work longer hours and have less time to contribute, the retirement age has increased, and everyone seems to be busy – but this view of the way boards should operate persists. And that was before the global pandemic upended everything and sent volunteer numbers through the floor.
In this climate, your organisation might be considering paying its board directors, to recognise the work they do and the responsibility they carry,
and to make it easier for you to recruit new directors.
Historically, charity and not-for-profit boards have worked for the good of the cause, with no expectation of payment. The world has changed – people work longer hours and have less time to contribute, the retirement age has increased, and everyone seems to be busy – but this view of the way boards should operate persists. And that was before the global pandemic upended everything and sent volunteer numbers through the floor.
In this climate, your organisation might be considering paying its board directors, to recognise the work they do and the responsibility they carry, and to make it easier for you to recruit new directors.
To know why you should be asking these questions, download the full document to the right-hand side of your screen.
1. Legal and regulatory issues. Is your organisation allowed to pay its directors?
2. Finances. Can your organisation afford to pay directors, or could you raise extra funds for this purpose?
3. Board composition and diversity. Do you struggle to recruit and retain high-quality board directors?
4. Board composition and diversity. Do you have people from diverse backgrounds on your board?
5. Board composition and diversity. Do you have difficulty attracting people with specific skills to your board?
6. Board composition and diversity. Is training about the child safety policy delivered annually to all staff and board members? Is there a register of those who have completed training?
7. Fairness. What would you say to someone who asked, “Why should board directors be paid and not the organisation’s other volunteers?”
8. Director accountability and performance. Does your board find it difficult to hold directors accountable for reading meeting papers and completing assigned tasks?
9. Expenses. How many of the following expenses do your board directors incur – without reimbursement – as a result of being on the board and attending meetings: meals away from home, accommodation, taxis, public transport fares, fuel, tolls, car running costs, carers, childcare, takeaway meals for kids, foregone income?
10. Public relations, reputation and transparency. Would you expect to find broad support for paying board directors among your stakeholders – members, staff, volunteers, donors, funders, users, clients, the general public? And if you introduced such a policy, would you announce the change or keep it quiet?