Amongst the stories to emerge from the CRC controversy, we learnt that seven Board members had served on the Board from between 9 and 15 years. Board renewal is a cornerstone of Good Governance and it is essential that every Board enjoys a regular injection of new blood and fresh ideas. This is where the importance of term limits comes in.
Setting Term Limits
Charities should have the term limits for their Board members outlined in their Articles of Association and Memorandum but the actual duration of a Board members term will vary from charity to charity. It should be long enough to allow the Board member to become meaningfully involved, but not too long that they become complacent.
For example, Boardmatch’s Arts & Mems specify 3 terms of 3 years for our Board members. Whilst this isn’t necessarily the best option for every charity Board, it has proved optimal in allowing Boardmatch to maintain a refreshed and effective Board.
Why have term limits?
Serving as a member of the Board requires significant commitment and energy. Board members who have a finite time period within which to fulfill their duties are bound to work more enthusiastically for the organisation, than those with an unlimited tenure. A long-standing Board member risks becoming complacent and this can be severely damaging for the organisation.
Term limits will also encourage the Board to develop new leaders. In anticipation of a departing Chair at the end of his/her term, the Board will be encouraged to think strategically about the next appointee. This will help stave off complacency and will encourage skill development amongst Board members.
Above all, term limits ensure that the Board continues to benefit from new ideas and perspectives. Without a departure date, Board members grow accustomed to doing things their way and this can often be to the detriment of the organisation.