Board Member Term Limits

The question I am asked most frequently is about board member term limits.  While there is no “one size fits all” answer, term limits in some form are definitely recommended and there are many guidelines to use when deciding on the length of time that is appropriate.

While a common board member term length in practice today is the three 3-year term (for a total of nine years) it is not the automatic answer for every board.  Boards need to consider the size, complexity and life cycle of the organization.

For large and/or complex organizations, term limits of nine years can be necessary to ensure a continual supply of board members familiar with the culture, intricacies and complexities of the organization.  The learning curve will be steep in the first term so the second and third terms can be focused on maximizing contribution and mentoring the next generation of board members.

For small or new organizations that have board members actively involved in either management or technical roles, term limits longer than nine years might be practical.  It is likely more difficult in these scenarios to recruit people with the time, talent, commitment or start-up vision that some board members can bring to the table so longer limits might be necessary.

Organizations that do not fall into either of these categories could consider shorter term limits in the 3-8 year range to ensure a steady flow of fresh ideas and make it easier to recruit board members that are not prepared to make a nine year commitment.  Term limits of less than three years are not a good use of board member recruiting and training resources.

Extensions to term limits can be granted on an annual basis in some circumstances such as during a CEO transition or if the board member is also a member of an industry or parent board but the bottom line is that there should be a term limit of some kind.  The first reason for a term limit is to discourage the real or perceived notion that a board member or board members own or control the board.  The second is that boards need a regular turnover of members to ensure diversity of thought, perspective and opinion.  The third reason is that times of rest are a gift from God.  Whether in the seven day Sabbath cycle or the seven year furlough cycle, God created times of rest for refreshment and renewal.  Board members who would like to serve on a longer term basis can use their time between terms to volunteer for the organization, reflect, gain perspective and seek fresh, new ideas for their next term.

Boards that would like to retain the institutional memory that comes from having long serving board members around can use vehicles such as a board member ‘emeritus’ category, creating a wider membership body or having a council or task force that advises the board on certain events or issues.

One final point is to make is to ask why the question is being raised in the first place.  If it is a reaction to a specific board member or problem, beware of trading one set of problems for another.  If it is part of a thoughtful regular review of organization mission, goals, objectives and recruitment then it can be a great affirming and challenging discussion.  Just remember to amend your bylaws if you are making a change.

By | 2017-07-27T12:57:59+00:00 November 7th, 2015|Governance, NonProfit Boards|0 Comments

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