Growing Up, Rules Required
Dear Governance Matters,
I am part of a group of 15 individuals who are raising funds to drill wells in Africa. Although in existence for only a little over one year, we have successfully funded two wells.
With 15 people, making a decision can be challenging. We need to change our organizational structure. We are establishing a board along with various committees. I am trying to avoid problems going forward but a situation has developed that makes me very uncomfortable.
We want to have a board of seven and I have taken the position that board members should not be related to each other. To me having a husband and wife on a board each with voting rights -- could be a conflict of interest. I would really appreciate your input on this situation as well any documentation that would point out the pitfalls of such a practice.
Thanks so much for your help
First things first: Congratulations on your success. In only one year, that's commendable.
Second, do you have your 501 9c) (3) status yet?
As to your question, you are absolutely right to put in place policies that will guide your board in the future. Generally speaking, having spouses on the board is not a good idea. I've decided to send this out to one of our legal eagles, then I'll get back to you with more specific information.
In the meantime, check out http://www.BoardSource.org for help on husbands/wives issue. I'm not sure it is really a "conflict of interest," but it is bad practice. It could lead to the perception of power cliques on the board and, although it may never happen, could create problems if the marriages go through rocky patches (most do!).