Remaining In Charge

How do I keep my board from removing me?

Simple answer: Do a good job.

Many founders want to add a clause to their nonprofit’s bylaws that will prevent the board from removing them. I think this is a bad idea. Also, the board can change the bylaws with a simple majority, so that won't be any guarantee.

A nonprofit is a business, and the board owns the business. The board should find the best people possible to run the business day to day. That is usually not members of the board — in the long run.

Now, if you expect to be the Executive Director (not a board director) and don’t want the board to be able to fire you, then the board can’t do its job. If you just want to never be removed from the board, then that’s a different question, but my original thought remains – what if you lose interest? become incapacitated? embezzle money? move to Tucson?

You can be a director and run the organization day to day. Lots of people do it. It’s a question of hats. You can then later on find someone to take over the day to day, and you just remain on the board.

If you expect the nonprofit to produce income for you (it’s a job, not a hobby), you would have to be an employee on a salary or you would have to be a contractor providing services, you can’t just take money out of the nonprofit. Funds are always separate – you can’t commingle the nonprofit’s funds with your own. The nonprofit’s income can only be used to further the mission of the nonprofit. This does not preclude paying salaries, but it does mean the owners can’t take money out for their own use.

Being on salary or contract does not mean you cannot be on the board, but it is a potential conflict of interest since the board sets employees’ salaries and negotiates contracts. If the board decides to pay you a salary, it would have to be “reasonable” which means within limits of similar jobs in the area. If you are on the board, you cannot vote on your salary.

As a paid executive director, the board would hire you and set your salary — and you would recuse yourself from that discussion. The reason most founders are not paid is because their nonprofit does not have the cash flow to support a salary. When nonprofits do grow to that size, they often hire a professional to run the business day to day, and the founder just remains on the board. The board is almost always a volunteer (non-paid) position.

I understand a lot of new founders want to never be removed from their nonprofit, but the reality is that there are a lot of nonprofits who desperately need their founders removed.

If you are afraid your board will gang up on you and vote you out, you already don’t trust your board. That is a very bad place to start an organization.

Your goal as a founder is to put in place a board that believes in the mission as much as you do, and will prepare the organization for the day you’re not around – for whatever reason. Your goal as a board is to choose the right person to run the organization day to day to ensure the organization will survive long-term.