What makes for an effective nonprofit HOA board of directors?

(For the record, I am not a lawyer nor work for a lawyer and I am not providing legal advice or opinion.)

First and foremost, an HOA is  a chartered nonprofit corporation given authority to function as such under the AZ Constitution.   The association’s Governing Documents, an agreement between the HOA and the members, gives the HOA the authority and powers to function as the governing body of the subdivision.

As you are well aware, both nonprofit corporation law and the Governing Documents place the ultimate authority and responsibility for managing the HOA – in the true meaning of “managing” and not CAM — in the board of directors (BOD).  CAM keeps the HOA functioning smoothly delivering the services and providing for “groundskeeping.”  In order for the HOA to accomplish its mission and goals, which provide the necessary guidance and direction for performance, it is the BOD that must decide 2 important questions: What is our purpose?  What should it be?

What then makes for an effective BOD? To start at the beginning and get right to the point, my emphasis at this important juncture (Managing the Nonprofit Organization, Peter F. Drucker, p. 171-172, 1990),

“The board needs to know that it owns the organization. But it owns an organization not for its own sake — as a board — but for the sake of the mission which that  organization is to perform.”

“If you find that the board has become inflexible, you have to look for ways of renewing the board with fresh appointments. The more power is concentrated in a few people on a board, the more likely the situation will turn unhealthy.”

And this is where the BOD has failed the members!

As pointed out in earlier posts, “mgmt case study #1”, SCG’s continues to widely publish its nonsensical vision and mission statements providing no guidelines to act or of any value to measure effective performance. What we have witnessed is a BOD deciding on its own where to go and what to do, cleverly masked as fulfilling the wishes and desires of the members.  In actuality, all those meet the board, chats, Q &As, etc. allow for a presentation of grievances without binding the BOD to action.

There is no provision to require the BOD to hold a vote on a member’s proposed amendment to the governing documents as permitted by state law with respect to removing a director or all directors.  Or to nullify an act of the BOD.

Drucker continues with, “Ducking controversy or minimizing difficulty, snowing people with reports that are not realistic either about the quality of the programs . . . or whatever . . . that’s terrible leadership”

It’s well beyond time for a necessary change in attitude and culture before SCG descends into chaos. Adoption of a new approach, as recommended in A Plan toward Restructuring the HOA Model of Governance is needed, today!