Beyond Compliance: The Trustee Viewpoint on Effective Foundation Governance (2005): Identifying the key components of effective foundation governance is not a simple matter. Given that there is no universal, comparable performance measure for foundations – no analog to a company’s stock price or profitability, for example – it is difficult to connect governance practices to foundation performance in order to determine conclusively which board practices correspond with better performance. As a proxy, we sought to understand what best predicts trustee perceptions of foundation board effectiveness. In so doing, we were able to derive a definition of board effectiveness that foundation trustees carry with them, whether consciously or not. This definition has important implications for boards and for the CEOs who ultimately answer to those boards.

Summary of Key Findings:

• Despite the diversity in foundation and board characteristics, there is a shared sense of what constitutes board effectiveness among foundation trustees. Across foundations of different sizes and types and across dimensions of board structure, five key characteristics emerged as the most significant predictors of trustee perceptions of foundation board effectiveness. These characteristics, in order of importance, are
  • Appropriate mix of trustee capabilities and utilization of those skills
  • Engagement in strategy development and impact assessment
  • Focus of discussions on important topics
  • Positive relationship with the CEO
  • Opportunity for influence and respectful dissent in board meetings

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