Can Our Nonprofit Organization’s Board Vote by Email?

By Eleanor Evans, Counsel, Hemenway & Barnes LLP

If your organization is a nonprofit corporation incorporated in Massachusetts, voting by email is not permitted unless the vote meets the requirements of a unanimous written consent. The board of directors may take an action without a meeting if ALL the board members (also called directors) consent to the action in writing and the written consents are filed with the records of the board meeting. This consent is known as a unanimous written consent. It is permitted unless your organization’s articles of organization or bylaws specifically prohibit it.

It is possible to circulate a vote on an action via email to all directors for them to consent to it in writing. However, for the vote to be valid, ALL the directors must return the consent AND vote in favor of the action. The action becomes effective on the date the last consent is returned. If any director fails to respond, votes against the action or abstains, the proposed action will not become effective.

If an action circulated for an email vote of the board does not receive unanimous written consent, the board may hold a meeting to consider and vote on the action. Unless your organization’s articles of organization or bylaws prohibit it, the board may meet remotely – by conference call or video – as long as everyone participating in the meeting can hear one another.

Generally, actions voted on at a board meeting at which a quorum is present require the approval of a majority of the directors present at the meeting. In some cases, however, approval by a higher number of directors may be required (or approval by a lower number of directors permitted). Therefore, it’s important to check your organization’s bylaws to determine the number of directors who must be present and vote in favor of the action, as well as the type and length of notice required for the meeting.

Note that proxy voting by directors is NOT permitted.

The rules described above also apply if your nonprofit is incorporated in Delaware or in any one of a number of other states. However, if your organization is incorporated in a state other than Massachusetts or Delaware, you should check the nonprofit corporation law of that state.

If your nonprofit is a trust rather than a corporation, the nonprofit corporation rules outlined above do not apply. Instead, the trust is governed by its trust instrument, which should be consulted to determine how many trustees must approve a particular action and how that approval must be documented.

If your nonprofit corporation’s board of directors has permitted proxy voting by directors or taken votes by email that were not unanimously approved, those votes – as well as subsequent actions taken based on those votes – could be challenged as invalid. (For example, if the board voted by email to elect officers and that vote
was not unanimous, the election of those officers could be challenged as invalid, as could all subsequent actions taken by those officers – such as their signing of contracts and checks.) The board should vote at a properly noticed and attended board meeting to ratify past actions that were voted on by proxies or by email without unanimous consent. Consulting with an attorney under these circumstances is recommended.

Highlights of the 2022 MNN Conference

On October 19th, MNN convened members and supporters of the nonprofit community across all parts of the state to connect with one another at our Annual Conference (held in-person for the first time in two years). The event, Impact. Realized., sought to hold up the incredible work that has been done over the past few years, and share stories for collective inspiration. 

The nonprofit sector faced the challenges of the pandemic head on when not everyone didwith innovative ideas and expanded services, it was nonprofit organizations that ensured the needs of their communities were met. The conference began with a keynote panel composed of previous MNN award winners to share what their experiences were like during this time, and look ahead to the future of the sector. 

My project-6 (13)-minGladys Vega of La Colaborativa worked tirelessly to serve her community of Chelsea, one of the hardest hit cities in the United States. Giving out everything from mattresses to vaccines to Chelsea residents, her organization multiplied the work they had already been doing. When asked about how funders have responded, she said, “it took the pandemic for them to notice people like me and the work we were doing…I’m not gonna let that happen again.”

[On funders], “it took the pandemic for them to notice people like me and the work we were doing…I’m not gonna let that happen again.” -Gladys Vega

My project-8 (3)-minThe shapeshifting that took place within organizations was something all of the panelists could relate to. Patrick Remy of Easterseals Massachusetts represented the many organizations that hosted in-person classes prior to the pandemic. In trying to find new and creative ways to reach their target population, they found online gaming became a point of connection. Patrick explained they were able to convert even the most skeptical, and many who never considered the activity before found they enjoyed themselves.

My project-2 (41)-minThe panel also touched on the difficulties many nonprofit organizations face when dealing with grant foundations. Speaking to both nonprofits and foundations, Dan Noyes of Tech Goes Home shared a reminder about where their roles lie, saying, “I hate the phrase ‘let’s bring the community to the table’the community owns the table.” He continued to say these people they are trying to help “are not ‘hard to reach’. If they are, it’s because you made them so”. 

“I hate the phrase ‘let’s bring the community to the table’the community owns the table.” -Dan Noyes

My project-9-minMary Beth McMahon of Special Olympics Massachusetts added on the topic of grants, that the constant pressure of trying to secure limited funds for your own organization has led to isolation from other nonprofits. She advocated for reaching out to those organizations around you instead of viewing them primarily as competition, and shared the value in building a stronger community to share knowledge with. 

Other themes throughout the day included diversity, equity, and inclusion, nonprofit technology, and improved communication with donors. With workshops on pressing topics like these, attendees were able to take away tools for achieving more inclusive, innovative, and efficient working environments. 

In addition to thought-provoking workshops, the conference included expert roundtables, networking, and a luncheon program honoring more MNN awardees and presenting this year’s Lifetime Achievement Awards. The 2022 recipients are Linda Cavaioli formerly of YWCA Central Massachusetts, and Michael Curry of The Massachusetts League of Community Health Centers.

We want to thank all those who were able to attend the live conference. We are already looking forward to next year, and thinking through how to make 2023 even better.

Leaves of Absence

Many employers are starting to see a growing request for leaves of absences, requiring them to navigate the often complex details of a number of different types of leaves.  The introduction of Paid Family and Medical Leave plans and other state leaves has mandated new regulations and added procedures that can complicate traditional leaves.   

Many employees are entitled to a leave of absence under State and/or Federal law.  However, some employees experiencing a situation requiring leave may not be eligible for a certain leave of absence and employers must decide if they will provide time away from work.    In those instances, an employer can offer voluntary leave.  The most common reasons are childbirth, adoption, caring for an ill family member, a serious personal health condition or military leave. 

When speaking with an employee about a leave of absence, it is important to know your State and Federal guidelines and be sure the policies outlined in your Employee Handbook integrate the unique eligibility and requirements of the various available leaves. 

TYPES OF LEAVE – WHAT IS MANDATORY vs. VOLUNTARY? 

Federal/State Laws govern mandatory Leave of Absence benefits. The most common Federal leave options are the Family Medical Leave Act (FMLA), Americans with Disabilities Act (ADA), Military Leave, Jury Duty, and Worker’s Compensation time. In addition, there are currently eleven states, CA, CO, DE, MA, MD, NJ, NY, OR, RI, WA and the District of Columbia, with Paid Family Leave programs and many more in the planning phase. These leaves are mandated and often paid through a “tax” on employers and/or employees.  These leaves may run concurrently with more than one type of mandatory or voluntary leave. 

Voluntary leaves are not required by law.  These leaves are a courtesy to employees based on company culture and policies.  These leaves may run concurrently with mandatory leaves.  Voluntary leaves may include vacation, floating holidays or personal time.  Sick time can be considered voluntary in some states.  Since these leaves are non-mandatory, it is at the company’s discretion to set the approval process and the acceptable length of time off.  Employers should be aware of consistency, precedent and best business practices when granting voluntary leaves while maintaining dialogue and engagement with employees. 

DESIGNING OR REVAMPING LEAVE OF ABSENCE POLICIES

Following certain guidelines will make the process and end results most effective:

  • Don’t design absence management strategies in a vacuum. They are integral to a holistic benefits strategy that aligns with recruiting and retention strategies but also encompasses health and wealth benefits.
  • Paid leave programs should ensure statutory compliance with policies, and they should be stated in a way that truly reflects the organization’s intentions. They also should measure up to competitive benchmarks.
  • Understand that employees can find absence management programs difficult and confusing. Respond accordingly with policy descriptions and explanations that are clearly stated and reflect the value that’s placed on employees.

Workforce absence management programs have become more critical in today’s environment. Managed strategically under an integrated benefits program, they don’t just help shape business cultures, but also make for more efficient organizations that appeal to potential employees.

For assistance reviewing and streamlining your leave policies, please reach out, we can help: insource@insourceservices.com.  

By Karynn Needel, Team Lead and HR Director, Insource Services, Inc.

Volunteer Safety and Management

Volunteers are the backbone of many nonprofits, houses of worship and other organizations that serve the greater good. It’s important, then, to keep them safe—and to make sure they are safe for your organization. One of the first steps is checking your level of insurance to safeguard your organization in the event of an illness, injury or other problematic event. Then, you need to take a close look at your practices.

Church Mutual has developed the following list to help organizations ensure their volunteers, and those they interact with, remain safe.

  1. Defend volunteers against the coronavirus. As we continue navigating the coronavirus (COVID-19) pandemic, remember you need to alter your operations, practices and procedures to prevent the virus’ spread. Provide protective equipment for all volunteers—including gloves and face coverings—and encourage frequent hand washing and social distancing.
  2. Screen all volunteers. Background checks are not enough. When you bring new volunteers into your organization, use an intensive screening process that requires a comprehensive application, references and an interview, as well as a background check. By the time a volunteer starts working, you should have a clear understanding of his or her motivations and prior experience.
  3. Train all volunteer drivers on safe driving practices. Check each volunteer’s motor vehicle records before allowing them to drive on your organization’s behalf. If they will be using their own vehicle, ensure they carry up-to-date auto insurance. Drivers who will be operating a 15-passenger van should review Church Mutual’s transportation safety resources to make sure they understand the increased risks of driving such a vehicle.
  4. Help volunteers avoid slips, trips and falls by maintaining your facility. Install safety mats, ensure you have proper lighting in all areas and keep floors free of tripping hazards.
  5. Safeguard your volunteers against the elements during outdoor events. If it’s a hot, sunny day, provide plenty of sunblock and water and encourage volunteers to take breaks in shaded areas. If it’s a stormy day, stay inside when you see lightning. If it’s raining and your volunteers still want to be outside, make sure they have the proper footwear to prevent them from slipping. If it’s icy, use salt or sand on sidewalks and other areas where people walk.
  6. Provide an easily accessible and well-stocked first aid kit for volunteers. Accidents happen, and you need to be prepared. Church Mutual has created a handy list of items that should be in all first aid kits. Make sure all volunteers know where to find a first aid kit in the event one is needed.

Without volunteers, you wouldn’t be able to accomplish all that you do, which is why you should invest your time in developing a volunteer safety and management program.

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Solving for Gaps in Health Equity

By: Unite Us

The recognition that community conditions and social needs significantly influence health
outcomes is not new. The pandemic has underscored this point and highlighted the known
health disparities and structural inequities existing between communities.

Effectively addressing social determinants of health (SDoH) requires dynamic sets of data
providing insight into local community needs and opportunities. We must address SDoH by
gaining a deeper understanding of individuals’ lived experiences and health outcomes—not by
disassociating them from the systems in which they exist, but by contextualizing them within the
inequities those systems create. At Unite Us, we’ve identified five principles for advancing
health equity through the use of SDoH data.

Five Principles for Using SDoH Data to Improve Health Equity

1. Ensure communities and individuals most impacted have power to make decisions.

CBOs can gain agency through shared decision making driven by the data they produce. This is
an important strategy for dismantling structural and institutional barriers to health equity and
unifying how we reach community investment decisions.

2. Leverage the power of referral data to improve access to social care.

We need to be clear on what we should measure, how often, and why. Data collection practices,
such as client interview questions, should be person centered and avoid asking clients to retell
traumatic stories across different providers. Data analysis should account for biases that lead to
inaccuracies, uninformed conclusions, or exacerbated disparities. It’s critical that outcomes data
indicate whether organizations connect a client to services and address their social needs.
Without it, their story is not complete.

3. Measure and evaluate data.

Health-equity-oriented evaluations should be designed to understand what works, for whom,
and under what conditions. They should reveal whether health inequities have changed over
time. Achieving this level of understanding can be challenging. A good first step is incorporating
health equity activities, goals, and expected outcomes into a program or intiative’s conceptual
framework or logic model to clarify the intended effects of the initiative or program on health
equity outcomes.

4. Remove barriers to data sharing.

Appropriately addressing SDoH requires removing barriers to data sharing across the systems
individuals interact with regularly. The health, social needs, and situations of clients served by
healthcare and community organizations continuously change. As clients move across sectors
and through referral pathways, their changing situations must accurately reflect wherever and
whenever an individual accesses social care. They should receive person-centered and
trauma-informed care, eliminating the need to recount traumatic experiences each time they
access services.

5. Use data to drive action.

The complexity and persistence of health disparities requires an approach grounded in public
and political will for change combined with cross-system collaboration. Across sectors,
stakeholders should consider how enhanced technology and data infrastructure can help
advance health-related policies. Doing so, stakeholders can prioritize meeting community
members’ social needs and developing policies that redistribute resources equitably to prevent
those needs from occurring at all.

At Unite Us, we believe evaluating social care data at scale meaningfully contributes to health
equity, and analyzing the relationship between health and social care data leads to valuable
insights about how to improve overall health. For a deeper discussion on bridging gaps in health
equity, download this white paper to learn more

 

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Mosaic: Creating Community Across Faith Traditions

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In May we invited MNN members to tell us about the work they’re doing to build stronger communities. When Mosaic: Interfaith Action reached out, we knew we wanted to share their story.

Mosaic, formerly known as Kids4Peace Boston, is an interfaith youth organization that works with faith communities throughout Boston to provide experiential learning programs. The organization leads programs for students ages 12 through 18 that instill nonviolent communication and diverse relationship-building skills at a critical identity-development stage of student’s lives. Mosaic connects students that come from the same neighborhood and from different faith traditions to learn from one another.

Last year Mosaic piloted the Circles of Action initiative, a free after school program with a social justice focus. They held a listening campaign and learned that the students wanted to spotlight mental health—at a time when many adults were calling for increased awareness of the same subject. The students created an advocacy plan, reviewed a State House bill, and shared their insights with Mayor Wu*. The initiative concluded with each student illustrating what mental health meant to them on a ceramic tile. Circles of Action will continue in the wake of the pilot’s success, with next year’s focus on climate justice. Executive Director Matt Anderson, said the Mosaic team felt they had achieved their mission when a group of students from different faiths went out for ice cream together after the program.

Mosaic’s story serves as a reminder of the role nonprofits fulfill. In spite of the divisiveness that surrounds us, nonprofits with an array of missions are working tirelessly to establish a more positive, equitable future for everyone.


*Participants of the Circles of Action program received a letter in response from Mayor Wu on their policy recommendations. Read the letter here.

To learn more about Mosaic: Interfaith Youth Action, visit their website at this link.

For comments or article inquiries, please contact Jessica Holmes at jholmes@massnonprofitnet.org.

Time For a Six-Month Check-In

By: John F. Gillespie, Nonprofit and Social Enterprise Practice Leader – Charles River CFO

With the restrictive concerns of COVID receding into the background, nonprofits have been returning to their mission and association work more robustly. This positive energy may be offset by the tightening labor market stretching staff even thinner, as well as the reality of inflation impacting all costs, including salaries. Flexible staffing and the ability to model various operational and financial strategies are critical right now for success. Over the next six months, nonprofits will need to consider what is required to respond to a future that may be financially challenging but hopefully without dramatic economic swings.

Here are several strategies to consider now.

  • Explore new ideas for earned income that set you apart from others. What about a new service or location if you have a strong brand?
  • What is not critical for the next six months? Can a new project, staff development program, or new hire be pushed out six months?
  • Now is the time to start if you are not doing monthly cash flow forecasts projecting out at least three months.
  • Are you getting accurate monthly financial statements on time and having actional data to make decisions?
  • Develop three budget scenarios for 2023. One with expected revenue, one with 20% more and one with 50% less. Model various organizational outcomes at these different revenue levels.
  • Assess your current level of risk and evaluate appropriate levels of insurance. Don’t underestimate the importance of cyber insurance.
  • Review staffing to understand who are the top performers and what is needed to retain them. Evaluate ways to engage them in new responsibilities, invite them to present to a Board meeting, and provide more opportunities to be leaders and have their voices heard.
  • If you think a headcount reduction plan is in the future, make sure you fully understand all the state and federal requirements as well as the best way to implement.
  • Conduct a vendor review to ensure all the terms and conditions are well understood and determine if payments could be optimized. Pay on time, not early, to retain cash. Or negotiate a discount if payments are made before the due date.
  • Mine your donor database to match messaging and additional giving options to appropriate donor segments.

Move forward or fall behind. Those are the only choices. Be proactive. Have an excellent financial/cash model in place but execute your plan. Inaction is not the optimal course. We are at the six-month mark for 2022. Where do you want to see your organization at the end of December 2022?


About Charles River CFO

Charles River CFO (CRCFO) provides outsourced finance, accounting, tax, HR, and recruiting services to nonprofits throughout the eastern seaboard from Maine to Washington D.C.

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Talent Acquisition, Transparency and Compensation: From Posting to Negotiation

By Lisa McKeown, Danisha Martin and Eric Salyers – Nonprofit HR

Successfully recruiting a candidate starts long before the job posting. It starts with understanding the critical role of transparency in your organization’s compensation practices and how it factors into the talent acquisition process. By prioritizing a partnership between total rewards and talent acquisition, your organization can create and sustain a compensation approach that also advances equity in your entire talent acquisition process. 

Compensation: Beyond What Your Organization Pays its Employees 

An internal compensation structure is the foundation on which your compensation offer to a potential candidate is formed. A compensation philosophy comes into play next, which is the outward statement, to your staff and board, of inward practices and a commitment to how diversity, equity and inclusion are infused into compensation decisions. As a guide, this statement ensures equity is at the forefront of your compensation, and talent acquisition, processes. Displaying this statement will also foster greater transparency and trust with both staff and potential candidates.

However, compensation doesn’t just come as a paycheck. For example, offering unlimited paid time off (PTO) or transportation support can be an immense benefit because compensation no longer reigns as the driving force for job seekers. In fact, only 32% of respondents in the 2021 Nonprofit Talent Retention Practices Survey considered compensation/benefits a primary reason to leave a job. Candidates are now embracing the need to work in an impactful role that aligns with their values. Thus, consider how flexible your organization can be when designing new hire offers to add this type of value and reinforce brand differentiation.

Transparency: Getting Comfortable with the Uncomfortable

Posting the position salary range in a job description demonstrates that your staff know the compensation structure for each position, where they fit in the structure and how equity plays into salary decisions. It indicates that the organization has done the work—and that is an organization candidates want to join. 

If you are a leader, you may have a fear of transparent compensation conversations with staff, even if there is an established structure in place. But staff want to know that they’re being paid fairly and are often comparing salaries amongst themselves. Thus, outlining how compensation decisions are made and highlighting opportunities for career (i.e. salary) growth are how to keep staff motivated and engaged, and set the organization up to thrive.

Talent Acquisition and Total Rewards Partnership

A collaborative partnership between your talent acquisition and total rewards teams ensures a continuous feedback loop of understanding the structures, practices and processes in place, which can encourage organizational cohesiveness and efficiency. For example, your total rewards team can partner with the hiring manager to determine specific role ranges and ensure they know how the structures work. It is also imperative to assess whether your compensation structures are attracting the right candidates your organization is seeking, indicating areas of opportunity to infuse equity

To strengthen this partnership, start by providing each other resources. Consider having your total rewards team create a one pager of your benefits offerings for your talent acquisition team, or participate in salary surveys, which will give your organization a baseline of reliable data to begin benchmarking. The goal is to create a symbiotic partnership between each team of subject matter experts to effectively operationalize your organization’s commitment to equity. 

View the accompanying webinar recording here.

 

Originally published on nonprofithr.com.

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Picture a Scorpion’s Tail!

Have you heard of tail spend?

Even if you haven’t, it exists in your not-for-profit organization somewhere on your Statement of Financial Activities. Simply put, “tail spend” refers to the 20% of your administrative overhead that you don’t have time to manage as tightly as you’d like.

The best way to think about tail spend is by recalling the Pareto Principle – the 80:20 rule. On the expense side of a not-for-profit’s statement of financial activities the 80% represents costs associated with the organization’s core purpose: what the organization spends on people and programs. That’s where financial managers direct their time and energy, and rightly so. And consistent with the Pareto Principle, that 80% of expenses is clustered around 20% of the suppliers – the core of key vendors who are closely managed and, for that reason, subject to all the proper controls.

 

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Conversely, 20% of a not-for-profit’s expenses – the “tail spend” – is associated with cost categories that aren’t core to the organization’s mission but are nonetheless essential. On the “tail” you typically find things like copier contracts and printer leases, telecom and data plans, payroll service fees, benefits insurance, property and casualty insurance, uniforms and linen rentals, software subscriptions, merchant card fees (especially relevant for cultural not-for-profits that sell memberships or charge admission), food service, etc.

What’s difficult is that the tail – that non-core 20% of a not-for-profit’s expenses – is where you find 80% of the organization’s suppliers. And unlike the 20% of suppliers who serve the not-for-profit’s core mission (and for that reason command financial managers’ attention), that 80% of the organization’s suppliers – the non-core suppliers – are much less likely to be closely managed or subject to proper controls.
In some organizations – it doesn’t matter whether they’re for-profit or not-for-profit – it’s not unusual to find that the cost of processing and paying invoices related to tail spend purchases sometimes exceeds the value of the goods or services received.

So, what can you do to put controls around your tail spend?

• Chart your total spending: how does the Pareto Principle apply among the suppliers to your organization? (For an example, see the graph below.)
• Study the data: are there cost categories in which spending is dissipated among a disproportionate number of suppliers?
• Prepare a negotiation strategy: are there opportunities to consolidate spending among a shorter list of preferred suppliers – i.e., reward them for giving you better service and lower costs?
• Leverage your dissipated purchasing power; shorten the tail; gain visibility to your spending; create metrics to measure your success in controlling your non-core administrative expenses.

A Pareto-style assessment of your tail spend opportunities will yield between 10% and 30% savings in each and every cost category you attempt. Why leak cash when you can redeploy it to enhance your mission?

Making financial wellness attainable for everyone

How underrepresented groups view their financial health – and how employers can help

When it comes to financial well-being, Americans are generally optimistic. According to new research conducted by The Harris Poll on behalf of Empower Retirement, more than half of people surveyed believe they can attain financial health.

However, this confidence is not consistent across racial and ethnic groups. Only 38% of Hispanic Americans and 43% of Black Americans consider themselves financially healthy compared to 51% of white Americans. While the research reveals critical inequalities in terms of how different groups view their financial wellness, it also identifies a clear opportunity for employers to step in and create meaningful change.

Almost three-quarters (73%) of people of color say the concept of financial health needs a makeover — and companies must redefine it so it is more realistic and attainable.

While the specific goalposts employees set for their financial well-being differ across racial and ethnic groups, Americans generally agree about their big-picture financial ideals. Unfortunately, survey results suggest that some underrepresented groups are less likely to feel they have reached those important goals.

Infographic - Financial goals across racial groups
  • Almost two-thirds (64%) of white Americans say they have bought a home compared to only 47% of Hispanic Americans and 35% of Black Americans.
  • Similarly, 46% of white Americans say they’re on track to retire when they want to compared to 27% of Hispanic Americans and 33% of Black Americans.
  • And while Asian Americans feel more confident about having an emergency fund and being debt free, they still lag behind white Americans on home ownership and retirement.

How employers can help

From an employer perspective, understanding employee progress towards their goals can serve as guideposts for financial well-being offerings. They can help prioritize what financial education, advice and resources may help the most.

And whereas more than six in 10 people of color want help on their financial wellness journey, employers’ engagement and advice efforts can fall short if they are not careful to build trust and connect with their audience in an authentic way. Download the research brief to learn more.

Research paper download - Making Financial Wellness Attainable for Everyone

Download research paper


The Massachusetts CORE Plan is an affiliate member of the Massachusetts Nonprofit Network. The CORE Plan is a 401(k) retirement plan designed specifically for small Massachusetts nonprofits. For additional information about the CORE Plan, please contact Lisa Cardinal at 617-510-4036 or lisa.cardinal@empower.com or visit www.ma-employer-core.com.