What You Need to Know before Putting Staff Members on Your Board

As a general rule, your nonprofit’s paid staff shouldn’t be board members. The situation can get too complicated. For example, conflict of interest is always a potential problem, especially when board and staff have different priorities, such as when employees want raises but the board says no.

Some exceptions to the rule do exist, though. In fact, many nonprofits have at least one staff member on their boards. In startup nonprofits, for example, founders frequently serve as both board members and staff members. This situation isn’t surprising. Who’s better suited to bring the vision and passion needed to create a new organization than the person who formed it in the first place? In many new nonprofits, of course, paying the staff isn’t even possible; resources are so limited that all work is done on a volunteer basis.

If a founder or other staff member serves on the board, it’s recommended that he not be elected board president because doing so tends to put all responsibility for vision and leadership in a single person’s hands. Sharing that leadership can be an important first step toward broadening an organization’s base of support.

Laws vary by state, but in many cases, having a paid staff member on your board is permitted. For example, under California nonprofit corporation law, up to 49 percent of the members of a nonprofit board are allowed to receive compensation from the nonprofit.

But the standards of governance set forth by the BBB/Wise Giving Alliance say that a board should include no more than one compensated member (or 10 percent of members for larger boards). Be sure to check out and follow the nonprofit corporation law in your state.