OK, let’s roll up our sleeves. Conversation about governance is not for the fainthearted.
The term “governance” is our field’s reference to a theoretical blueprint for constructing and guiding board life. It’s rooted in legalities like fiduciary responsibility but it’s also much, much more. Say the word “governance,” and we all know what we’re talking about, right? Or do we?
For me, governance begins when three or more people come together to form a working group. First and foremost, participants must agree on their reason for becoming a group – their mission, purpose, or goal. This starts an on-going process by which individuals set aside personal interests contrary or irrelevant to the group’s larger purpose. While that can be challenging, members draw inspiration and courage from their identification with the group’s purposes and sense of being included.
As the group sorts out an approach to working effectively, something else happens that’s intrinsically rewarding and renders the group more effective: members form a sense of connection as they increasingly identify with the group and develop relationships with one another particular to group life. The combination of spending time together as a group and on-going, productive work builds cohesion, rapport, and trust and, in turn, the group’s relatedness facilitates the work. The most effective working groups are driven by a dynamic mix of transactional and relational life.
Family foundation boards are a particular type of working group with a specific purpose: philanthropy. With the notion of “working group” in the background, Giving Related defines “governance” as the practices philanthropic families use to work together legally, ethically, and effectively as a board. In simple terms, governance amounts to the ways trustees engage as a group and “do business” over time.
Governance comes to life in the form of anything done or communicated that touches the entire board across the calendar year, especially recurring practices that are essentially habits. As a board’s way of working takes root and grows, recurring practices give rise to a foundation’s culture which “governs” how trustees tend to engage.
Every family board operates under the influence of written and unwritten rules – born of governance habits – making it less likely individuals will push beyond the bounds of usual practice. From this vantage point, governance – writ large – forms the crucible for every philanthropic decision a family board makes. As such, there’s nothing more important for a family board’s effectiveness and experience with philanthropy than the components of their shared life as a working group and the spirit in which those practices are implemented.
Since family foundation governance is complicated and since there’s no single, right way to go about it, it will be helpful if we can share our board practices and learn from one another. That’s the goal of Giving Related.
