Join our Nonprofit Good News-Letter
Ain't no board like a nonprofit board
Board Competence refers to the collective skills, experience, and training that enable a nonprofit board to govern effectively. It means having board members who understand their oversight role, grasp the organization’s work, and can make informed strategic decisions. When there are gaps in that competence, such as limited financial literacy, governance knowledge, or relevant sector experience, the board becomes a weak link in organizational resilience. These gaps can lead to poor oversight, blind spots in risk management, and strategic drift away from the mission. I’m an admirer of anyone who wants to serve on a nonprofit board. I have done it myself with many organizations. Yet in my experience, too often, board members do not fully understand how to carry out their roles.
When things go wrong at the board level, the consequences can be severe for both the organization and its beneficiaries. An ill-equipped board may miss early warning signs or fail to ask hard questions, resulting in decisions that put the nonprofit at risk. A competent board is a cornerstone of resilience. When board competence falters, nonprofits are more vulnerable to oversight failures, financial missteps, and mission failure.
Board competence also affects trust. Donors and stakeholders expect nonprofits to be overseen by capable leaders. A competent board inspires confidence, while an unskilled board invites doubt and reputational risk. In Managing Your Nonprofit for Resilience, I identified board competence as Challenge 23 because it so directly affects an organization’s ability to withstand disruption and adapt to change. Even strong staff teams can be undermined by poor board-level decisions if governance competence is lacking. So what has changed since my book was published in 2022?
Recent research presents a mixed picture. On the positive side, awareness of good governance practices is growing. Over half of nonprofits now impose board term limits, most commonly two consecutive three-year terms, which can help introduce fresh skills and perspectives. There is also increased emphasis on skills-based and diverse board recruitment, with growing recognition that boards with broader expertise and demographics tend to perform better in fundraising and community trust.
Funders and regulators are also raising expectations. Major grantmakers increasingly ask about board qualifications and training, and as of 2025, some jurisdictions have introduced targeted training requirements. California, for example, now requires boards of companies with five or more employees, including nonprofit boards, to complete sexual harassment prevention training. These developments suggest incremental structural improvements in board development.
Despite these trends, fundamental competence gaps persist and may be widening as nonprofit challenges become more complex. A late-2023 governance study found that many board members lack confidence in their understanding of financial, programmatic, and risk-related issues. BoardSource’s Leading With Intent surveys continue to show gaps between what CEOs need from their boards and what boards deliver, particularly in technology, fundraising, and external trend awareness.
Many boards still do not conduct regular self-assessments, and effective ongoing education remains the exception rather than the norm. As a result, too many boards continue to rely on individual expertise rather than collective competence. Awareness may be higher in 2025, but progress in closing competence gaps remains uneven.
Recent regulatory actions underscore the stakes. The New York Attorney General’s lawsuit against the National Rifle Association (NRA) highlighted years of governance failure, with a jury finding in 2024 that the organization failed to properly oversee its operations and protect its assets. The judge cited a lack of board-level accountability and signaled the need for significant governance reforms. These cases send a clear message that boards lacking competence and diligence can expect increased scrutiny and intervention.
What does board breakdown look like in real life? That will be the focus of my next blog post.
If your inbox is full of problems and vague inspiration, here’s a change of pace.
The Nonprofit Good News-Letter delivers real wins, practical tools, and replicable solutions from organizations that are moving the sector forward - all in a concise Monday briefing curated by a 35-year nonprofit advisor.
Each issue includes:
Subscribe now and make your next Monday more productive and inspiring.