Governing Boards In Nonprofit Organizations

According to Hopkins and Gross (2010), the governing board plays a key role in how the nonprofit is controlled and handled. Based on how the organization is setup will determine how the governing board is selected, however, since they are the gate keeper of the organization (Hopkins & Gross, 2010), it would behoove the organization to have board members that are financially literate as it relates to business and budgets. Budgets are generally completed annually and the numbers should equate to the programs objectives and support those that are responsible for its functions (Young, 2010).
The nonprofit boards are charged with ensuring public trust, accountability and operating and effective and efficient organization (Hodge, & Piccolo, 2011). Though there is a lack of research on the correlation of board activity and economic stability; research implies an impact of an organizations economic stability when the board is actively involved with the organizations strategic planning (Hodge, & Piccolo, 2011). Planning is inclusive of performance standards and measures, action planning, objectives, appraisal of performance and financial figures; it is a complete set of details on how to implement the strategy (Shim, & Siegel, 2008). …show more content…
Research supports governing boards that participate in strategic planning and resource development succeed in long term success (Hopkins and Gross, 2010). The primary role of the governing board is to ensure financial accountability and effective oversight (Hopkins and Gross, 2010). As guardians of the assets budget knowledge is