Board Term Limits
I recently heard David Barton, an expert on cooperatives from Kansas State University, speak on board term limits. Since I see the downside as well as some benefits of organizations having term limits for their board members, I was particularly interested in his comments. David Barton shared that recent research on governance practices among cooperatives in Kansas has shown a move away from term limits. Many organizations have found that the benefits of term limits are not worth the disadvantages.
Almost everybody is in favor of clear terms. When someone becomes a board member it is important that the end of this board appointment is understood – the individual will be a board member until a certain date, say March 31, 2012. If those who select board members wish, the individual can be given another term that might expire on March 31, 2015. There are actually some organizations that have asked people to join their boards, and serving became an ongoing responsibility until the person pleaded years later to be excused from this apparent unending obligation. Let’s be clear and state the date on which the current commitment ends. Three year terms are common. I have also seen one, two, and four year terms.
The item in question around board term limits is how many times an individual’s board member service commitment may be renewed – how many terms may he serve? May he have two 3-year terms, an unlimited number, or something in between? Few organizations limit service to one term. A strong reason to limit board service to two or three consecutive terms is to encourage new people with fresh ideas and energy to join the leadership team. This can keep the organization moving forward and responsive to changes in its environment. When the incumbent runs for re-election she often has significant name recognition and at least perceived experience advantage over an opponent so bringing in new blood can be difficult if incumbents can seek re-election again and again. Fresh ideas are needed on boards and some organizations have under-contributing board members. Those who detract from the organization’s future have to be removed somehow and limiting their years of service does that. However, there are people with so much passion for an organization and its mission that they are continually learning about the industry, seeking innovative approaches, and supporting organizational progress. These people also have their board contribution curbed and without them the organization can lose precious momentum. Supporters of term limits often remind me that after a one year break these enthusiastic contributors can be nominated again.
However, David Barton’s research shows that rarely do these great board members return. I know that many organizations keep their ears open for word that an energetic and experienced person is no longer on ABC’s board. The invitations to serve elsewhere start coming. People who are wired to be productively engaged in their community and the business world seldom want a down year. I can’t count the number of people who tell me their intent to relax for a year after a season of intense commitments was fouled by an interesting opportunity that appeared the first month or two of their intended sabbatical. If your organization has board members who have been key to your recent success, there aren’t other people that can currently fill their shoes with excellence, and there is some turnover on your board to allow for fresh blood, I encourage you to consider the merits of allowing long-term board service. You owe it to the owners or members of your organization to have the best people on the bus.
