Question: Why do the bylaws talk about some of the same things that our Governance Manual deals with? I'm confused about where things like election of board members and officers, quorum of board meetings and things like that should be recorded.
Answer: Most organizations start with bylaws because they are a legal requirement, but at their beginnings organizations rarely have a governance manual. For this reason the bylaws often deal with some of the things that should be dealt with in the governance manual. This becomes confusing when the board finally gets around to writing a governance manual but doesn't remember or bother to update the bylaws.
The important distinction between bylaws and a governance manual lies in the different working relationship that each is designed to describe.
The bylaws of an organization are intended to describe the relationship between the members of the organization and the board. The confusion comes when the bylaws also try to describe the working relationships within the board.
The governance manual is intended to describe the working relationships within the board. Those relationships include: the board/board chair, the board/board member, board/committee and board/committee chair.
It becomes even more confusing when the bylaws deal with yet a third level of relationships, the board/CEO relationship. This important relationship should also be described in the governance manual.
It is of course legitimate for the bylaws to say something to the board in the delegation of authority from the members to the board. Remember that the Relationship Model™ emphasizes the reality that there are always limitations to authority. For example, the members may require the board to meet at least four times per year. They do not want too much time to go by between meetings of the board to which they have delegated so much authority/responsibility to control the organization. That is entirely legitimate and should not be removed from the bylaws just because the board has placed the same requirement into its governance manual. The members have the right to limit the board's authority, even if the board would limit itself without being required to in the bylaws.
Yet some things that we see in bylaws should come out when a governance manual is written. For example, boards should be free to elect their own officers, particularly the chair. The members at Annual General Meetings may not have a full appreciation of the competencies required in a board chair. (Even the board may not be aware.) A chair should not be elected thoughtlessly at an AGM - as a means of rewarding a retiring CEO, for example. It is better for the board to have the freedom to choose the person on the board who is best suited for the responsibilities of the position.
Focusing on the working relationships within an organization is the key to understanding what should be in the bylaws and what should be in your governance manual.
Incidentally, did you know you can now write your entire governance manual from start to finish in a one-and-a-half day board retreat? GovernanceMatters.com Inc. offers this service anywhere in the world. The Relationship Model™ makes it easy to draft the full set of policies required to become a governing board. We can send someone to facilitate the retreat for you or you may have us tailor a Board Retreat - Governance Manual Workbook to fit your organization so that you can do it yourself.
Les Stahlke, President
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