What Is a Self-Perpetuating Board of Directors?
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Some nonprofit corporations have self-perpetuating boards of directors. These directors have the same organizational management responsibilities as on other types of boards, but they are recruited and elected in a different way. Self-perpetuating boards take responsibility for their own recruitment without external influence or input from other stakeholders.
A self-perpetuating board of directors manages its membership subject to its own regulations. It can set terms dictating how long a director can serve, and can elect and re-elect directors itself without input from external members of the organization. If a director comes to the end of a term and leaves, or resigns mid-term, the board sources and elects a suitable replacement from contacts or recommendations made by its members. This model allows the board to control its own membership composition.
The primary advantage of a self-perpetuating board of directors is control -- the board chooses its own directors and does not have them imposed on it by other members of the organization. This can help build a more diverse range of skills and experience, and ensures that future directors can contribute to the continuity of existing aims and values. The model is also useful if a board feels that it lacks skills or representation -- it can target specific candidates to fill gaps when vacancies arise. The board can also set limits on terms of tenure, and stagger bringing in new recruits to keep things fresh.
A self-perpetuating board can have some disadvantages. If it allows directors to serve indefinitely, or to be re-elected for many years, it may become stale. Boards need to look at the bigger picture of director expertise and avoid always electing directors with similar backgrounds and experience. Directors who serve together for many years may also suffer from entrenchment issues in which everyone becomes too familiar with each other and considers the "feelings" of the board in decision-making processes rather than what is best for the organization. If the corporation has members, they may not feel that this model represents their interests democratically.
Some nonprofits operate a membership-controlled board rather than a self-perpetuating model. Here, directors have to be elected onto the board by members with voting rights. The board may be able to nominate and promote potential new directors, but cannot make the final decision on who serves.
Carol Finch has been writing technology, careers, business and finance articles since 2000, tapping into her experience in sales, marketing and technology consulting. She has a bachelor's degree in Modern Languages, a Chartered Institute of Marketing.certificate and unofficial tech and gaming geek status with her long-suffering friends and family.