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One responsibility of the board of directors is appraising the work of the organization’s executive director. An evaluation can help to improve the confidence, support, growth and working relationship between the board and the executive director. It presents an opportunity to identify challenges in programs or performance, reward the executive director for work well done, and strengthen the organization’s overall administration.
Executive directors should receive an annual evaluation from the board of directors. Often the appraisal is conducted as a discussion between the executive director and the board chair, although the evaluation should also be documented in writing.
The executive director’s performance should be measured in relation to his or her job description.
The evaluation may cover:
- staff relations;
- fiscal management;
- external public relations;
- effectiveness in working with the board of directors to achieve the annual plan; and
- success helping the board achieve its own accountability and level of responsibility.
Specific aspects of the evaluation process should be determined by the personnel committee or a task force composed of the board of directors. The executive director should be informed of the process in advance. An executive committee or the board chair should report the conclusions of the evaluation to the executive director. The evaluation can include:
- input from all of the individual board members;
- input from peer staff members;
- intermittent observation;
- a formal rating system;
- an open-ended discussion of career goals and paths; and
- response from the executive director.
One system that often works well for many nonprofit organizations is for the board chair to circulate a survey to all of the board members asking specific questions about the executive director’s performance during the past year. The questionnaire can use a ranking system and include space for comments. Once the board of directors completes the survey, the board chair can summarize and share the responses with the executive director. During this meeting between the executive director and board chair, the two can set performance objectives for the upcoming year. The board chair should create a report for the entire board for review, followed by a discussion about changes in compensation, if necessary.