Nonprofit Governance: Coronavirus and COVID-19
The board of directors of a nonprofit is ultimately responsible for the activities and affairs of the nonprofit and the exercise of all corporate powers. A board may delegate management of the day-to-day operations to officers, committees, employees, or a management company, but it may not delegate its oversight responsibility or its function to govern. And when it delegates authority and power, the board must do so with reasonable care.
For nonprofits with employees, the roles of the board are to direct, oversee, and protect. Direction is provided through mission, vision, and values statements; plans; policies; budgets; specific directives; and responsible leadership. Oversight involves reviews of executive performance, financials, audits, programmatic impact, and compliance. And protection of charitable assets is accomplished by appropriate risk management, including internal controls and insurance, and strategic decision-making.
Directors are subject to two fiduciary duties in carrying out their governance responsibilities: the duty of care and the duty of loyalty.
Meeting a director’s duty of care generally requires acting in a reasonable and informed manner under the given circumstances. The standard of care is typically expressed as that which “an ordinarily prudent person in a like position would use under similar circumstances.” The circumstances now are substantially different from last month, and each director must consider how that changes the care and attention an ordinarily prudent director would provide to their organization. While director liability for gross negligence may be rare, the risk may be significant if, for example, the disease spreads within the nonprofit’s facilities or event site due to inattention and inaction of the board, particularly if the nonprofit seems to be an outlier in its management of the crisis.
Meeting a director’s duty of loyalty generally requires acting in good faith and in the best interests of the corporation. The key to meeting this duty is to place the interests of the corporation before the director’s own interests or the interests of another person or entity. This does not, however, mean that furthering the mission in the short-term is more important than protecting employees, acting consistent with the organization’s values, and helping to assure the sustainability of the organization. Balancing these sometimes competing interests is one of the difficult challenges of a director.
COVID-19 Preparedness for Employers
Supporting Individual Staff Members
No Business Continuity Plan? Take These 4 Steps
Follow these four steps to bolster resilience and minimize the long-term, costly impacts of ANY serious interruption to ‘business as usual.’
Step 1. Reach Out
Determine how best to quickly and efficiently communicate with ALL key stakeholder groups in your nonprofit. Your method could be a series of lists (think email addresses and phone numbers), a communications app with options, or a phone tree. Don’t waste time trying to find a slick or fancy communication tool. For now, choose one that will enable you to quickly communicate key messages about your operating status, cancellations, staff availability, etc. Assign clear responsibility for crafting those messages and make sure everyone knows who has authority—and who doesn’t—to click “send” on those critical messages.
Step 2. Make a Short MUST Do List and Do It
Identify a short list of 3-5 things your nonprofit MUST KEEP DOING no matter what to survive and thrive despite the interruption. For many organizations, that list will include processing payroll, providing vital services to vulnerable clients, and letting partners, contractors, and others know about your temporary change in status. Gather your best and brightest around a virtual table to determine the practical, plausible strategies to keep doing those MUST DO things.
Step 3. Shutter and Scale Back
Identify the services, programs, and activities that you will temporarily discontinue, delay, scale back or change for the immediate future: think 45-60 days. Determine the steps you will take to make those changes in operations immediately.
Step 4. Plan to Resume Operations
Brainstorm with your core leadership team some of the critical steps necessary to bring shuttered programs back online. Also, determine whether you’ll resume operations fully on a specific target date or restart one program or service at a time. As part of this step, identify any short-term projects or activities that build resilience for your agency. For example, could someone who typically answers the phones assist with an important information-gathering project, making telework a possibility? Assume that your staff and volunteer team want to support your work and are available to pitch in and pivot as needed!
We know it’s hard NOT to do these things, but we urge you to try:
COVID-19 Care Checklist for Nonprofits
To support your employees
To support your organization
To support your community
To support yourself
Some Thoughts for Scary Times
Eight Steps for Managing Through Tough Times
Your organization’s leadership may already be clear about what the most important priorities are. But if they aren’t, we strongly recommend bringing key staff and board members together to wrestle with three critical questions that can help to create that clarity:
Until everyone has agreed on the answers to these questions, it will be hard to develop a real consensus around which programs and activities are truly core and which ones, however reluctantly, can be let go.
Running Effective Virtual Nonprofit Meetings: 9 Best Practices for Facilitating Engagement
This guide covers the following topics:
Nonprofits as employers
For those nonprofits that are employers, now is a good time to revisit your policies and procedures regarding staff communication, sick time and remote work. And an even better time to make a commitment to decent work practices in your organization that will help smooth the way for healthy staff and a healthy workplace! Consider:
Ten Steps to Effective Crisis Management for NonProfit Organizations
Why Have a Crisis Communication Plan?
Don’t think you’re different – crisis can strike any organization, at any time. The longterm health and reputation of your organization is at stake. What matters most in a crisis communications situation is not what you do in the middle of the crisis, but what you do in the weeks, months and years ahead of one. One of the worst things that organizations can say in a crisis is “no comment.”
Nonprofits and Coronavirus, COVID-19
What steps should nonprofits take?
Manage Anxiety & Stress
Stress during an infectious disease outbreak can include
Taking care of yourself, your friends, and your family can help you cope with stress. Helping others cope with their stress can also make your community stronger.
What Nonprofit Board Members Should Be Doing Right Now to Address the COVID-19 Situation.
The Board’s Role in a Crisis
The board should be working closely with the chief executive to govern and manage the situation, as well as address external threats. While the CEO is responsible for operational planning and executing these plans, the board should be reviewing and responding to the organization’s strategy, and providing feedback. Both the board and CEO should be flexible in their planning, and consider all the possible ways the COVID-19 crisis can evolve. As the board reviews the organization’s plans, it should consider:
COVID-19 Response and Communications Planning
Sustainability to Survivability: 5 Nonprofit Finance Must-Do’s in the Time of COVID
Time is of the Essence
None of the steps here are easy—especially in a time of crisis. Given this rapidly evolving pandemic, it is tempting to put off decision making to see how the situation progresses. One lesson from the Great Recession, however, was that those organizations that assessed their situation earlier were able to make strategic decisions which resulted in less severe measures later. Nonprofit leaders face competing demands and priorities as they deliver on their missions. By inviting others in, communicating clearly, looking at the organization holistically, and understanding where we’re starting from financially, leadership can attempt to spread the workload, build commitment, surface strategies and implement solutions to help their organizations—and our communities—survive and, once again, eventually thrive.
One constant across the sector has been the cancelling of spring fundraising events and the upheaval of development plans. As organizations struggle to maintain operations, payrolls, or both while revenue is decreasing, there are steps they can take to increase likelihood of success:
Business continuity planning
In an ideal world, we’d all have business continuity plans ready at our fingertips! If you do, now is the time to dust it off and ensure that everyone on your team knows what your plans are. If you don’t have one, now is the time to put together a small group of team members (which could include board members or volunteers) and craft a plan. Be sure to address:
Here are ten things you can do instead of meeting with donors and asking for money during the COVID-19 pandemic
Successful Fundraising: 8 Steps to Weather the Coronavirus Crisis