Diversity and Inclusion are words we’re all hearing these days. How are they important to your nonprofit board? A board that’s more diverse and inclusive will bring more ways of looking at issues and problems, capitalizing on the different ideas and points of view. Including voices from a wider range of backgrounds will add value to your organization.

Diversity

Does your board reflect the population of your organization? If the organization is a membership organization, do the board members represent a cross section of the membership? If the organization is a charitable organization, do the board members represent the community served, not just donors of the organization?

Often, diversity on a nonprofit board will address differences in race, gender, religion, age and sexual orientation. Other factors to consider when diversifying a board might be ability or geography. For example: Are disabled members of the community represented? Are there board members from each geographical region that the nonprofit serves?

Inclusion

Inclusion and Diversity, while sometimes used interchangeably, are actually very different.

A board can consist of diverse members, but if those members do not feel welcomed, respected or valued as individuals, they may not be able or willing to contribute fully. Inclusion means encouraging a sense of belonging and value.  Leaders and board members of inclusive organizations will support and encourage all members to participate, speak up and share their ideas and expertise. All voices should be heard in the thinking and decision-making processes.

A nonprofit board that values diversity and inclusion will leverage the differences of its members to solve problems and advance the mission of the organization.  When nominating new board members for your organization, consider the diversity of your members. Make sure that all members feel respected and valued.

Diversity and Inclusion will likely result in a more innovative and effective board for your organization.

Board members are fiduciaries of an organization and board minutes are considered legal documents that can also serve as a record for future reference. Minutes can provide evidence that a board has exercised care in decision making as well as serve as proof that the board operates in accordance with their own stated requirements (likely in their by-laws), and those of regulatory agencies. Board minutes provide support of decisions made at the board meetings and also tracks the progress of the organization’s mission/goals.

If your organization’s financial statements are audited, board minutes are important to the year-end audit. The auditors will request copies of the meeting minutes for the year under audit, and any subsequent minutes until the audit opinion is issued.

Items the auditors are looking for:
• Approved budgets
• Approval of financial statements
• Contracts entered into
• Large operating expenses approved, including addition of fixed assets
• Significant write-offs

Some organizations tend to keep too much information in their minutes. It is not necessary to document everything verbatim from a meeting into the minutes. The minutes should be more of a summary of the topics addressed and actions taken.

Items to be included in board minutes:
• Type of meeting
• Date, time and location
• List of attendees
• Summaries of discussions of the board
• Board actions taken
• Review of any voting that occurred (motions/seconds and whether passed)
• Elections of officers/directors
• Summary of financial items presented

Items not to include in board minutes:
• Every detail of the discussions
• How each individual voted
• Details on board members’ opinions
• Off the record discussions

If you have any questions, or would like to discuss your specific situation, please contact your trusted TBC advisor.

By: Kristi Mason, CPA, Manager