Written assignment 2-cap

Findings

The purpose of this study is to explore what members serving on a board of directors think about term limits and their perceptions of an ideal length of service. Members of non-profit boards were targeted for this research, as members of corporate boards are constrained by stricter confidentiality requirements. Ten individuals were emailed the survey and seven responded. One board member’s responses are not included in the findings due to lack of sufficient information. I provided some demographic information about the board members, as well as some information about the board they are serving on. This includes the type of board, what its mission is, and when it was founded. Since this is an exploratory study, I felt looking at this information may reveal something telling or useful with regards to the problem statement.

Board Member A

Demographic African American Male	Age 38	Length on Board 3.5 Years	Board and Mission New York Urban League: Provides support and opportunities for employment and education for people of color	Founded 1910
Number of Board Members 17	Actual Term of Officers No longer than two consecutive three year terms	Actual Term of Members No longer than two consecutive three year terms	Recommended Term of Officers No longer than two consecutive three year terms	Recommended Term of Members No longer than two consecutive three year terms

Board member A felt that term limits are necessary as they provide a level of consistency in planned, strategic objectives for an organization, giving time for execution and results to take place. He believes that board members starting and leaving their terms at the same time would be disruptive and could leave a gap in experience and needed organizational knowledge. He further believes that the chairperson should not serve any more than two consecutive, three year terms. This is because as a new chair, depending on the size and scope of the organization, it can take up to two to three years to execute on the board’s vision. His argument is that the implementation of new ideals and strategies do not yield results overnight and is the objective of the first term. The second three year term is realizing the benefits of the vision and strategy and setting up the successor to be even better for the organization. Board Member A gave the same recommendation of not more than two consecutive, three year terms for a board member’s ideal length of service. His reasoning is that this gives consistency in support of the mission, vision of the organization, and the chairperson; and lends itself nicely to the board members assisting the organization in furthering its goals and objectives.

Board Member B

Demographic Caucasian Male	Age 52	Length on Board 2 Years	Board and Mission Row NY: Makes the sport of rowing accessible to young people in NYC	Founded 2002
Number of Board Members 16	Actual Term of Officers Six years	Actual Term of Members Six years	Recommended Term of Officers Five to Six years	Recommended Term of Members Staggered 3 year terms for profit boards, none necessary for non-profit boards

Board Member B believes a 5 to 6 year term for the chairperson would be ideal. He thinks it takes at least 12-18 months for a chairperson to fully take control of an organization and that person should have at least a full four years to implement his/her vision. He also thinks a succession plan where an individual has no less than 3 if not 6 months to transition to take over as chairperson would be ideal. Given that 5 to 6 years is a substantial amount of time, Board Member B believes consideration should also be given to have some sort of recall or removal mechanism for the board to remove a chairperson who is not fulfilling their job. He also suggested a mid-term review. In terms of board members’ terms, he likes the concept of staggered 3-year terms where up to 1/3 of a Board can be up for replacement or re-appointment in any given year. However, Board Member B clarifies this suggestion. He thinks for profit companies should limit the number of terms to 2 consecutive terms for outside directors, stating that this protects against outside directors becoming entrenched in a board seat. He also thinks it promotes better oversight and potentially injects fresh thinking onto a board. However, he does not necessarily think the same applies for a not for profit board. There are different objectives and exigencies for a not for profit. For smaller not for profits, he believes there is a strong argument to be made not to limit the number of terms which a board member can serve so long as they are still fulfilling the mission of the not for profit. This assumes, however, that there are terms and that board members are reviewed at the end of each term. Only effective board members should be reappointed. For larger more established not for profits or foundations, critical oversight is essential and no different than on for profit boards. Thus, strong consideration should be given to applying the same for profit limitations to these larger not for profits.

Board Member C

Demographic African American Female	Age 54	Length on Board 4 Years	Board and Mission CASA of Hudson County: Advocates for abused and neglected children	Founded 2002
Number of Board Members 17	Actual Term of Officers Two terms of two years	Actual Term of Members Seven years (plus can take a year off and return for another seven)	Recommended Term of Officers Two years with a vote for a possible second term.	Recommended Term of Members Five year term with a possible two more.

Board Member C believes that term limits give a consistent train of thought and direction for an extended period of time. It allows the strategic plan a chance to develop as the core group of members provide direction. The term limit also allows the member to step away and rethink their position and determine if they truly want to continue as a board member. Her concern with term limits is with the constant recruitment of new members, as the search is always on going and does take time. There is also a learning curve new members must go through. Board Member C recommends a chairperson’s length of service of two years with a vote for a possible second two year term. The chairperson needs to be a high performer driving the board’s strategic plan. The concern becomes when the member remains in position too long and ideas and creativity become stale. She believes members should be set to a five year term and then have the option to request to stay an additional two years. There needs to be a break in service at some point so that the board and the members have a chance to reset and determine if they are a good fit for the board and is this particular organization a good fit for them. This also allows the board to bring in new members keeping a flow of new ideas and networking opportunities. In addition, Board Member C offered that she felt the term limits need to be structured to the needs of the organization and that several factors should be considered before locking in specific term limits. These include asking: Is the board able to actively recruit new members and keep a consistent flow of new members? What type of Governance does the board have to operate under? She believes the strategic plan should address the board structure and term limits with a clear direction of how the board should be selected. Term limits are needed to allow the board to reset itself and continue to develop new ideas and new thought processes.

Board Member D

Demographic African American Male	Age 42	Length on Board 18 months	Board and Mission Beat the Streets: Help underprivileged youth in NYC get ahead through the sport of wrestling	Founded 2005
Number of Board Members 21	Actual Term of Officers Six years, but Four preferred	Actual Term of Members Ten years	Recommended Term of Officers Three years	Recommended Term of Members None given

Board member D believes that term limits allow people to know that their time is limited and compels them to act with deliberate speed. He sees a chairperson’s ideal length of service as a minimum of 3 years. This is in order to give this position time to clean up and rectify pre-existing conditions as well as time to roll out new initiatives and directives. In terms of members, he offers if there is an abundance of talent available there should be term limits in an effort to give others an opportunity to serve. However, if there is a dearth of capable, high functioning talent, retention should be emphasized. Board member D believes a talented and well balanced team is essential to avoid paralysis.

Board Member E

Demographic Caucasian Male	Age 49	Length on Board 2.5 Years	Board and Mission United Way Canada: Supports United Way activities worldwide.	Founded 1927
Number of Board Members 15	Actual Term of Officers Three years	Actual Term of Members Three years but allowed up to Six	Recommended Term of Officers Five Years	Recommended Term of Members Five Years

Board member E believes that term limits were valuable in that it is good to get a fresh perspective. New board members often bring up innovative ideas. However, he also notes that at times it feels that the board is always starting over and not seeing initiatives through. He recommends board chair and board member terms ideally would be around 5 years so that initiatives could have time to work. Too much turnover would cause too many problems. Board member E does add that depending on the organization the length of appointments can differ. Some organizations may need longer terms based on how long initiatives take to actually measure.

Board Member F

Demographic African American Female	Age 55	Length on Board 4 Years	Board and Mission Figure Skating in Harlem: Assists girls of color grow through the sport of figure skating	Founded 1997
Number of Board Members 15	Actual Term of Officers Two years with possible reelection	Actual Term of Members Two years with possible reelection	Recommended Term of Officers Two years	Recommended Term of Members Two years

Board member F believes that 2 year term limits are good because it brings consistency and keeps the knowledge on the board. If someone is not effective, the length is good to replace that person. To her, 2 years is also enough for members to be effective in reaching the mission at hand.

There are a lot of gaps in the literature regarding board term limits. There is not a consensus on whether there should be limits or how long these limits should be if they are deemed to be necessary. Arguments for having limits center on having a fresh and innovative look at things. Arguments against term limits center on losing the institutional knowledge of members. Since boards are an essential component of running an effective organization, knowledge of how they should be structured for optimal performance is pertinent information.

The research presented here shows that for the six organizations highlighted, all have term limits in effect for their boards. It is clear that there is no standard ideal length of time. Nor does it seem there should be. A consistent message received was that it depends on the type of organization you are with and what they are currently trying to accomplish. It may not be in the organizations best interest to adhere to a predetermined term length if it is not suiting their goals.

Another similar concept that was mentioned during the research was that of having a review and/or a time of reflection where both the organization and the members determine if they are still effective and contributing members. One board member suggested a mechanism for removing board members who are not living up to expectations. Another suggested that it may not be necessary to limit the number of terms which a board member can serve if they are in fact still fulfilling the mission of the organization.

An interesting finding from this study is that the respondents indicated that term lengths for members and chairperson were either the same, or the board members terms were longer. None of the organizations had instituted longer term limits for their chair as compared to the length of the members term limits. Yet, several members mentioned that the chair person needs the time to implement their vision and new ideas and strategies, as well as fix existing issues. I am unsure why they are not provided with longer term limits than board members. One guess is that it is a high stress position that requires more frequent turnover to prevent burnout or stagnation. Another guess is that allowing for a quicker change over gives the organization a chance to take advantage of differing styles of thought and leadership. The sample size of this study was so small that it also could be an anomaly.

Another finding of interest was that out of the 6 board members, only 2 made the exact same recommendations of term limits that their organization currently follows. 3 members proposed higher term limits than what they are currently serving under, and 1 member proposed less term limits. Although the research did not show a consensus for ideal time lengths, it did provide a general sense that they should be long enough for initiatives to take hold and be given the chance to be successful, and short enough to keep a flow of new ideas and creativity.