Research on Corporate Governance Helps Local Non-Profits Manage Their Boards
It’s a happy circumstance for faculty when their research interests overlap with the needs of their local community.
Business administration professor Denny Garvis, a practicing attorney before he went back to graduate school to earn his doctorate in strategic management, has long been interested in the processes that govern boards. His research into the corporate governance of publicly held companies has shown that, while board governance has little impact on the performance of large companies, strong boards can make a big difference to small firms.
Garvis wondered whether he could use what he’d learned to help non-profit organizations in his own community improve their boards, and thus their overall performance.
“In addition to my academic research, I’d had the personal experience of being on small, community boards. I could see that when organizations had a conscientious executive director and well-functioning board, good things happened,” said Garvis.
With support from Washington and Lee’s Arthur Vining Davis Endowment for Leaders in Law and Commerce, he and students developed the “Tune-Up Workshop for Social Enterprises: Required and Recommended Practices for Non-Profit Board Governance.”
For the past several summers, Garvis has hired one or two student research assistants to help him plan and run the half-day board governance workshop for area non-profits. The workshop is free to attend, and participants leave with lots of ideas they can implement immediately.
This year’s workshop, held on June 25, included 14 executive directors of area non-profits, including Boxerwood Nature Center & Woodland Garden, Woods Creek Montessori, Habitat for Humanity, United Way, the Historic Lexington Foundation, Lime Kiln Theater, Hull’s Drive-In and other local 501(c)3 organizations.
Workshop topics are wide-ranging, covering everything from compiling a board book to managing conflicts of interest to implementing board self-assessments.
Judy Mauck, the recently retired director of Rockbridge Area Hospice, led a session based on the lessons she learned, including the importance of bylaws and articles of incorporation.
“One of the most important things you can do as an executive director is be involved in selecting board members,” Mauck said. “When we went out and interviewed potential board members, we already knew what our needs were and where they were likely to fit.”
Mauck and Garvis were joined by Garvis’ two summer research students, Taylor DeVoe ’15, and Nati Mechale ’15, both of whom gave presentations on principles of good governance. To prepare them for their presentations, Garvis provided a seminar-style introduction to corporate governance of for-profit companies as well as non-profit social enterprises. During the second part of the summer, they’ll apply these principles with internships at one local non-profit, Yellow Brick Road Early Learning Center.
“We had divided up the principles, but we were both surprised to find that we couldn’t get through all the material because there was so much good discussion,” said Mechale, a business and accounting major from Addis Ababa, Ethiopia. “It indicates there’s a need for this type of workshop.”
This was Stephanie Wilkinson’s first year attending the workshop. Wilkinson is the first-ever executive director of Main Street Lexington, a new volunteer group dedicated to preserving, enhancing and promoting downtown Lexington. “I’ve been president of a few boards around here, managing executive directors, and now that I’m on the other side, it’s helpful to see what executive directors deal with—managing the board.”