Saturday, March 29, 2014

Term limits: Worth it or worthless?

Hey there,

So in a number of various situations, term limits is one of those given circumstances to any nonprofit governance situation, particularly arts nonprofits. But for the purpose of this particular post, I am referring to term limits regarding nonprofit board governance, not for-profit, and not elected government officials, which isn't to say that the conversation isn't at least related.

And to answer my own question before you've even read the rest of this blog, I would say it depends. That being said, I put the question out there and received some replies I wanted to share from colleagues.

Here's a reply I received on Twitter from Jess Solomon (thank you!!):
And if you'd like to see the the responses my inquiry received on Facebook, well, check out the post here:

So as not to rely solely on anecdote and personal experience, although all those who replied are professionals whose input I certainly appreciate, respect, and recommend, I Google'ed "nonprofit governance term limits" and thought I'd highlight excerpts from some of the results on the first several pages.

From On Board For Term Limits, The NonProfit Times, 10/1/11:
The Internal Revenue Service (IRS) has endorsed term limits, according to Bruce Hopkins, a partner in the Kansas City, Kan., law firm of Polsinelli Shalton Flanigan Suelthaus. “It’s certainly recommended in many quarters, but there’s ongoing debate whether it’s appropriate or not. Limits can force new blood on a board, which can be a good thing but sometimes organizations lose people who are competent, who can serve and want to serve, but can’t. There’s a valid debate on both sides of the issue,” Hopkins said.
From Five Reasons Board Leaders Should Have Term Limits, The Chronicle of Philanthropy, 1/18/11, specifically having to do with a Board Chair's term limit:
Term limits provide a painless way for people who aren’t doing a good job to retire gracefully and automatically. Admittedly, this is a pragmatic argument—and the downside is that a chair who is doing a fantastic job may get forced out early. But I’ve never heard a real-life complaint about term limits. And I’ve heard many complaints about their absence. 
And from Principles for Good Governance and Ethical Practice, Independent Sector, regarding the core concepts of "Principle 17: Board Member Term Limits":
  • Term limits provide natural turnover on the board. 
  • Staggered term limits prevent the entire board from changing at the same time, providing a way to preserve institutional memory. 
  • Term limits should be enforced in a systematic manner.
One quote from Alyson Ball, President of BoardWorks, LLC, from Term Limits - Critical to Your Nonprofit Board's Success:
Term limits are critical to a board's health because they prevent a single individual or group from monopolizing the spirit of the organization. They ensure that new ideas and approaches are explored - something that's essential to the success of every organization. Everyone is forced off the board eventually. If your board doesn't have term limits, I recommend you start thinking about them now.
And in conversations I've had, the main argument against term limits seems to be worry about loosing great board members, particularly regarding institutional knowledge. But that seems to be more a matter of engagement rather than governance.

But it's all related, because if you don't have a robust process for recruiting and onboarding new board members, of course one would be worried about loosing current ones.

Regarding the institutional knowledge, that not only seems to be more about how new members are onboarded, but also resides largely in the domain of the staff, more so than the board members, who are on the ground working Monday through Friday, 9 to 5, and often times more.

But again, the best answer is "It depends", because this is not a one-size-fits-all kind of question. With that being said, what is your own experience, and where along the spectrum of "Worth it" to "Worthless" would you say term limits lie for you?

- JR
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