When in Crisis, What Should Boards Do?

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Chairs

October 8, 2014;Forbes

In recent weeks and months, there have been a series of crises in organizations ranging from data breaches at Target, Michaels, and Chase to the sexual abuse scandals at Penn State and domestic violence in the NFL. In many of these cases, although the boards of directors were not blamed directly, they often came under fire for not having paid close enough attention to see the crises coming or for reacting too slowly. It is no surprise, then, articles have begun to appear addressing how a board should act before, during and after a crisis.

Forbes’ online news outlet has published a list of 10 things boards should do, authored by contributor Davia Temin, who is listed as a leadership and crisis expert. Although her comments address for-profit corporations for the most part, the lessons can also be applied to nonprofit organizations. In brief, here are the 10 things:

  1. Know that you are responsible. Boards are where the buck stops, and public accountability in that area is growing, so accept it.
  2. Be proactive. Try to stay ahead of the curve instead of always being in a posture of reacting to the crisis after it has hit the paper—or the NPQ newswire!
  3. Rebalance your intrusiveness. In an interesting bit of commentary, Temin says the old mantra of “noses in, hands off” is no longer acceptable. Boards are going to have to readjust, paying closer attention than ever before without going to micromanagement.
  4. Create a risk committee, but also do more. Risk Committees are emerging as standalone bodies, but mostly work on oversight of previously identified and measurable metrics that are generally defined and reported on by staff. Temin argues that paying attention to social media and other outlets will give information beyond those metrics to which boards should pay attention.
  5. The full board should be involved. A new form of dashboard, reporting on risk management, should be given to the board regularly. Beyond that, the board should also monitor what kinds of complaints are being registered with the organization by letter or email and how they are being handled.
  6. Don’t rely on Crisis Management Policy. When a crisis hits, you will likely not expect it and you will not be ready. However, if you have protocols in place that you can activate quickly, you can respond well. Having a policy may not prevent the crisis, but it will tell you who should do and say what, and when.
  7. Don’t just rely on lawyers, either. The legal assistance from a lawyer is going to be critical, in all likelihood. But you will also need help in the court of public opinion; get help with managing the story as it goes viral.
  8. Act fast. When a crisis hits, Temin estimates the organization has a matter of minutes to react before the story gets out and gets ahead of them. Be ready to respond within the half hour, even if you only say, “We have no idea and are looking into it. We will report what we learn as soon as possible.”
  9. Have an effective board. The best thing is an ounce of prevention in the form of an effective board providing appropriate levels of oversight and guidance.
  10. Model the behavior. The board should do the right thing during and after the crisis, modeling the behavior for the whole organization.




Nonprofitrisk.org has a different take on crisis management for nonprofits, although only slightly. In their book Vital Signs, their recommendations fall into three categories: anticipating the crisis, preventing a crisis, and responding to a crisis. They stress the ounce of prevention and planning in advance. Teams should be put together to assess risk, develop a crisis management plan and team, and inventory assets that might be at risk, as examples. Under “Preventing a Crisis,” they stress setting the bar of ethical behavior, modeling it, and enforcing it. Under “Managing a Crisis,” they stress keeping cool and calm, implementing the plans, communicating with stakeholders, and keeping a record of what is being done.

These recommendations are not brain surgery. Be prepared, do what you can to watch for signs of trouble, and act fast when the crisis hits. The one thing Temin has added, her number-one item, is critical for boards both in and out of the nonprofit sector: Know that the buck stops with you, and act accordingly. We might add that good stewardship and integrity are key to staying above the worst of this kind of fray.—Rob Meiksins

  • Davia Temin

    NPQ, I think you did a great job of picking put the parts of my article that pertain to nonprofit governance. In fact, I serve on a number of national nonprofit boards, and work with many, many more. The trend I’m seeing is that nonprofits are just as eager, and called upon, to practice good governance in the face of both predictable and unpredictable crises as are for-profits. Maybe even more so. But, it is often more challenging to get the “noses in, fingers out” part of the governance equation right at nonprofits. When Directors are fueled by passion, they often seek more involvement. Sometimes that is truly needed, other times not so much. We are all reevaluating the equation in real time, as the nature of crisis and its velocity changes, in real time. A fascinating time to do this work, when we all need to do the right things, in the right ways, in real time.