GOVERNING BODY

A person or persons with the legal authority and responsibility to set policy and oversee the operations of an organization. Generally, the governing body is a group, such as a board of directors or board of trustees. While the exact responsibilities of the governing body depend on the nature and character of the organization, the governing body has minimum fiduciary responsibilities to the organization set by statute, regulation, and case law, and typically assume responsibilities for long term planning, risk management, and evaluation and effectiveness of management.		  
close
  FOR-PROFIT ORGANIZATION

An organization that is owned or staffed by professionals and intended to make a financial profit by offering a specific service or set of services. These organizations may provide services similar to those offered by not-for-profit organizations, except that the charges to the consumers may be higher and/or established on bases different than the rate-setting criteria employed by not-for-profit organizations.		  
close
  PERFORMANCE

A measure of how well an organizational system provides services to consumers. Performance is often based on key indicators, such as rates of service, cost per consumer, degree of satisfaction with services, and extent of consumer access to services.		  
close
  COMMUNITY

A specific group of people living in the same locality and who may share a common culture, values, and norms. Communities can also be defined by race, religion, ethnicity, age, occupation, political status, tribal affiliation, interest in particular problems or outcomes, or other common bonds. The term "community" encompasses worksites, schools, tribes, residential neighborhoods, business districts, recreational areas, and health and human service sites.		  
close
  LEADERSHIP

A nonprofit organization's leadership consists of its governing body, chief executive officer, and may also include its senior management. In a public agency the term refers to the agency head and administration team. The term "leadership" is not generally applied to for-profit organizations. With respect to COA standards, in for-profit organizations the term leadership applies to the owner and board of directors if one exists.		  
close
  POLICY

A written statement of principles, values, or intent that provides a basis for consistent decision making and guides the actions of staff, management, and board of trustees. A policy is intentionally broad in its language and application. The following is an example of an anti-discrimination policy:

"[Organization Name] shall not discriminate on the basis of race, color, religion (creed), gender, age, national origin (ancestry), disability, marital status, sexual orientation, or military status, in any of its activities or operations. These activities include, but are not limited to, hiring and firing of staff, selection of volunteers, selection of vendors, and provision of services."

In contrast, a procedure is a detailed, step-by-step description of a process. It tells the reader how to do something. Generally, policies are implemented through procedures. For example, the above anti-discrimination policy would require a detailed grievance procedure in order to operationalize it within an organization.

The governing body has the fiduciary responsibility for setting organizational policy. Therefore, policies must be approved and periodically reviewed by the organization's governing body. However, the governing body typically delegates (via policy) the responsibility for policy development to management. In owner-operated for-profit companies, the owner can act as the company's governing body, depending on the company's corporate structure.

In a public agency the responsibility for setting and reviewing policies may belong to the agency's management team, elected officials, another governmental agency, or as is often the case, a combination of the above.

  
close
  CONSUMER

The individual, family, group, or community that seeks or receives services.		  
close
  STAKEHOLDER

Any person, group, or organization that has a vested interest in the services provided by the organization. Examples: clients, consumers, personnel, funding organizations, referral organizations, vendors, and governmental bodies.		  
close
  ADVISORY GROUP

A group of individuals selected by an organization's governing body or management who possess unique skills and/or knowledge and whose role is to make recommendations, provide information, and/or share input from stakeholders. Advisory groups do not have formal governance authority or responsibilities. Advisory groups can be ongoing or ad hoc.		  
close
COA
USER:  PASS:  LOG IN         
SEARCH:    GO
 
Print
 
Governance
  
Private Org Public Agency  

GOV 2: Governing Body and Community Representation*

 
The organization's governing body is sufficiently active, capable, and diverse to guide, plan, and support the achievement of the organization’s mission and goals.
Update: Revised Interpretation, Deleted Note - 03/01/11

GOV 2 Original Interpretation and Note:

A board of trustees/directors act as the governing body or “owners” of a not-for-profit organization. For the purpose of these standards, in a for-profit organization the “owners” fulfill the role of the governing body, except as indicated. The organization will apply the appropriate perspective when completing the standards in this section.

Note: Please see Worksheet: Board Skills in the Tools Index for additional assistance with this standard.

Interpretation: For the purposes of COA's standards, the owners of a for-profit organization fulfill the role of the governing body.

GOV 2.01

 
The governing body sets a tone of responsible stewardship and ensures policies and performance uphold the public trust.
Update: Added NA - 03/01/11
Added NA
NA The organization is a for-profit organization.

GOV 2.02

 

The governing body:

  1. reflects the demographics of the community it serves;
  2. represents the interests of the community it serves; and
  3. serves as a link between the organization and the public or community.
Update: Revised First and Second Interpretations, Revised First Note, Deleted Second Note, Revised NA, Added Related Standards - 03/01/11

GOV 2.02 Original First and Second Interpretations, First and Second Notes, NA and Related Standards:

Interpretation: To meet the intent of the standard, the governing body must demonstrate effective representation of community and consumer needs and reflect a wide range of skills, abilities, and community knowledge and professions. Also, the governing body should have members able to advocate for, give, or obtain needed financial resources.

Interpretation: Relatives of personnel may serve as members of a governing body, provided that such representation does not undermine the governing body's independence and diversity.

Note: Please enter demographic information on the organization's governing body and community advisory group on the Community Demographic Profile.

Note: When the governing body alone does not possess the necessary skills, an advisory group may be established to achieve implementation of the standard.

NA The organization is not otherwise required to have a governing body.

related GOV 6.03

related ETH 2,  ETH 5.03,  GOV 2.04,  GOV 6.03
Interpretation: COA recognizes that Board recruitment is a significant challenge for many organizations and that meeting the standard may be a long-term process.
Interpretation: Relatives of personnel may serve as members of a governing body, provided that such representation does not undermine the governing body's independence and diversity, and meets the organization's conflict of interest policy.
Note: Please enter demographic information on the organization's governing body on the Community Demographic Profile.
NA The organization is a for-profit organization.

GOV 2.03

 

The governing body reflects:

  1. governance expertise, including leadership ability and policy development skills;
  2. relevant business experience;
  3. financial expertise;
  4. knowledge of consumer issues and trends;
  5. familiarity with and access to community leaders, political representatives and other relevant local organizations;
  6. public recognition and respect; and
  7. commitment and ability to fundraise or to connect the organization with potential resources.
Update: Revised Interpretation, Revised NA - 03/01/11

GOV 2.03 Original Interpretation and NA:

A diversified set of skills and experience are necessary for a high functioning organization. When the governing body alone does not possess the necessary skills, an advisory group may be established to achieve implementation of the standard. Regarding element c), if the organization’s audit committee does not have a member with financial expertise, the organization would explain the absence and plans for seeking such expertise.

NA The organization is not otherwise required to have a governing body.

Interpretation: To meet the intent of the standard, the governing body should reflect a wide range of skills, abilities, and community knowledge and professions, including the ability to advocate for, give, or obtain needed financial resources.

An organization whose governing body does not possess some of the skills and expertise outlined in the standard, can still receive a rating of 2 for GOV 2.03 if the governing body has access to missing skills or expertise through:

  1. a stakeholder advisory group (see GOV 2.04); or
  2. use of qualified consultants.
Note: Please see Worksheet: Board Skills in the Tools Index for additional assistance with this standard.
NA The organization is a for-profit organization.

GOV 2.04

 

For-profit organizations, organizations that do not have a representative governing body, and networks establish and maintain a stakeholder advisory group that serves as a bridge between the organization and the community and it:

  1. includes representatives of relevant community groups, consumers, parents, service providers, advocates, and others with an interest in the success of the organization achieving its mission or purpose;
  2. provides information and feedback to the organization about services, outcomes, the perception of the agency within the community, and other information that would help the organization better serve its defined population and the community; and
  3. serves in an advisory capacity only and does not assume governing body or management responsibilities.
Update: Revised Standard, Added First Note, Revised NA - 03/01/11

GOV 2.04 Original Standard and NA:

Network management entities and organizations that do not have a representative governing body establish and maintain a stakeholder advisory group that serves as a bridge between the organization and the community and it:

  1. includes representatives of relevant community groups, consumers, parents, service providers, advocates, and others with an interest in the success of the organization achieving its mission or purpose;
  2. provides information and feedback to the organization about services, outcomes, the perception of the agency within the community, and other information that would help the organization better serve its defined population and the community; and
  3. serves in an advisory capacity only and does not assume governing body or management responsibilities.

NA The organization has a representative governing body.

Interpretation: The input and feedback provided by stakeholder advisory groups are vital to the functioning of a well-run organization. In order for advisory groups to function well the organization should:

  • establish clear and transparent recruitment and selection guidelines;
  • have reasonable expectations about what the group can accomplish within the parameters of its mission and available resources; and
  • actively consider and respond to the group's input, feedback, or recommendations.

Note: Please enter demographic information on the organization's community advisory group on the Community Demographic Profile.

Note: Please see Tip Sheet: EAP Advisory Committees in the Tools Index for additional assistance with this standard.
NA The organization is a nonprofit organization that has a representative governing body.
QUICK JUMP TO
Top
 
PURPOSE: Sound governance increases the organization’s viability and sustainability.
 
RELATED FILES