Over the years, I have worked with many, many boards of directors: As a manager, as a consultant, and as a member of the board. And as we all – managers and board members alike – know, some boards are just better than others at administrating their community and effectively achieving their agenda with grace, dignity, professionalism, and humor. These boards are a pleasure with which to work or on which to serve. One of the main ways these effective boards – or, as I call them, great boards – administrate well is through the mitigation of liabilities, or risk management, which can come in all sorts of forms. Here are just a few:
Great Boards keep rogue Board members in check. Great boards don’t allow a single board member to put the community in jeopardy by making racial, ethnic, or sexual comments at a meeting. Too many times I have heard board members say something they would never think to say in a “regular” business situation, without anyone – including the chair – calling them on this improper and risky behavior. Failing to reign in these types of situations can be a serious liability for the Board and the community.
… And they don’t deny the existence of liabilities. See no evil? Hear no evil? Great boards never wear blinders when it comes to the existence of liabilities. They don’t turn their backs, nor look the other way, hoping that the liability will go away. Great boards have set a policy on dealing with potential and evident liabilities, and they deal with them quickly and surely. Great boards don’t wander off into the weeds when examining their liabilities, either: They obtain information and direction from insurance, legal and management experts to guide them on this path. Great boards understand, and never shy away from, risk management.
Great Boards always use insured vendors and subcontractors. Great boards know they have a duty and responsibility to the community to utilize only professionals.
Great Boards seek expert advice and opinion. A board of directors for a community association is a deliberative body which makes decisions based on solid input. That solid input should include but not be limited to, their own experience, facts, data, standard of care and standard of the industry, precedents set before them, and expert opinion. Using these information gathering tools, Great Boards make informed decisions that are best for the community, even when those decisions may be unpopular with certain community members.
I’ve mentioned expert a few times in this article. But who are your experts? Most of them are at your fingertips:
Your manager or management company. There is a wealth of experience and information to be had not only for your manager, but within your management company.
Insurance agent. Need to understand your liabilities better? Talk to your insurance agent! They will be more than happy to answer any questions you have.
Contractors. You may not think about it, but your contractors in the filed are usually very expert at what they do. Manteca issues? Ask your handyman service. Landscaper problems? Talk to the landscape supervisor, or company owner. The same goes for all those who maintain your amenities. All of these people are more than happy to help you and make recommendations when asked.
It is my experience that most Board members serve as part of their civic duty, and all they really want is to know how to meet that end with intelligence and grace and be appreciated for the difficult job they perform as volunteers. All Boards are potentially Great Boards. Taking your Good Board to Great takes true Vision, and the will to serve yourselves and the community at the highest level.
By Julie Adamen
Julie is the principal of Adamen Inc., a national consulting and employment firm specializing in the community management industry formed in 1997. She is a recognized and designated expert in community management and association and management company operations. She is a prolific author, educator, motivational speaker and trainer for community managers and boards of directors.