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    Reaffirming AIGA's governance and financial practices

    In the February 7 issue of Insight, we announced that several committees had been formed to assure that AIGA is launching its second century as a “sound, accountable, focused and relevant organization.”

    We wanted to look hard at the way we are governed and organized, and to assure that our financial practices are adequate for proper oversight and accountability. In particular, two committees of the board undertook the deepest review of current policies and practices in two decades. Many of the issues they reviewed were raised by members.

    A broad range of professionals participated on the committees

    The Governance and Finance Committees joined forces to facilitate review of all current policies.

    The Governance committee was chaired by co-president Drew Davies and included past board members Robin Tooms and Connie Birdsall, with a full review of all policies by AIGA’s governance counsel, Hugh Webster (Webster, Chamberlain & Bean in Washington, D.C.).

    Current AIGA treasurer Darralyn Rieth headed the Finance committee that included former president and treasurer Doug Powell and chapter presidents council chair Andrew Twigg, with AIGA’s auditor, Amish Mehta (Friedmann LLP) serving in an advisory role.

    AIGA’s performance against The Independent Sector’s checklist

    AIGA is determined to adhere to the highest standards of integrity and accountability. The Independent Sector, the respected organization promoting effective and responsible nonprofit practices, publishes a checklist of the hallmarks of a well-governed nonprofit. In the committee reviews, AIGA has ensured that its policies meet each of these expectations. All governance and finance policies are available for member review. They are reviewed and approved annually by the board at its May/June retreat, in order to keep them current with the business environment and laws or regulations.

    Review of governance policies and practices

    In addition to reviewing all adopted policies and practices against both legal requirements and best governance practices, the Governance committee focused on a number of areas affecting board participation, weighing the pros and cons of change based on board, chapter leader and member questions voiced in the past year.

    Length of board members’ terms

    The length of a member’s board term was considered in the context of assuring continuity. One third of the board rolls off each year, replaced by a new class of five board members serving three year terms. This rotation assures that two-thirds of the board always has had some involvement in previous issues and decisions. A three-year term for national board members aligns with industry best practices.

    Should chapter experience be required for new board members? Should they have been members for a certain number of years?

    The current criteria for the board nominating committee lists chapter experience and AIGA involvement as a preferred, but not necessary attributes. The committee believed the flexibility to add new perspectives to the board representing a rapidly evolving profession outweighed requiring all members to have the same connections with AIGA’s legacy activities. Overall, the nominated slates tend to represent both chapter and AIGA leadership experience.

    Length of president’s term

    A two-year term for AIGA’s president aligns with industry best practices, although the committee recommended a new position of president-elect to provide greater continuity.

    Recommendation to implement a president-elect position

    After consideration of best practices, the committee recommended that AIGA implement a “president-elect” position. The president-elect would be selected by the same process currently used for the president. The position would be selected one year into each president’s current term, so that the president-elect would serve as an “understudy” to the president for the second year of the president’s term, and the president-elect would then serve a full two-year term as president. The president-elect could be selected from newly incoming board members, from current board members, or potentially selected from those who previously served on the national board, although the candidate would be expected to have had at least one year of national board experience.

    Election of president

    The current process of selecting and electing a president aligns with industry best practices and contributes to a nomination that serves both governance and strategic needs. No changes to current practices are recommended.

    Composition of executive committee

    AIGA’s executive committee is comprised of the president, treasurer, executive director and typically a second-year and a third-year board member. The executive committee also serves as the finance committee and the audit committee. The current makeup and structure of the executive committee was judged as satisfactory and in alignment with industry best practices. No changes to current practices are recommended, other than recognizing that an additional member, the president-elect, will be added.

    Ex officio positions for special interest groups

    There was a consensus that AIGA should not establish standing ex officio positions on the board for segments of the membership or special interest groups. AIGA board members are charged with representing the interests of all members; ex officio members can change the culture of a board by advocating the interests of the group they represent over the broader interests of the entire membership. The board has experimented with ex officio positions in the past and found those members less fully engaged with broader member interests. No changes to current practices are recommended, although the bylaws permit appointments in special cases.

    A culture to reinforce continuity

    The committee recommended that board members be encouraged to think of their tenure as a three-year experience in which the first year is spent becoming oriented to the role of the board and the issues; the second year be one in which a board member becomes fully engaged by the issues; and the third year include an additional role in helping the first-year class become effective board members. In this way, there is continuous mentoring.

    Review of financial practices and policies

    The Finance committee reviewed all current financial practices and reporting procedures on finances, most of which had been recently updated and approved, in May 2013, to meet current legal requirements and investment practices. Current practices were deemed appropriate to provide both transparency and accountability. Practices were also reviewed by AIGA’s independent auditor, Amish Mehta, and corporate counsel, Hugh Webster.

    The committee affirmed the appropriateness of the following financial policies:

    Actions taken by the AIGA board

    In a meeting on April 24, 2014, the board approved adding the following language to Section 9 of the AIGA Bylaws:

    “(f) A president elect may be identified and elected a year in advance of the completion of the incumbent president’s term to facilitate effective preparation for assuming the responsibilities of chief elected officer. In the case of the nomination of a candidate not currently serving on the board or present on the slate for election, the president elect may be appointed to the Board ex officio for one year. The process for selecting the president elect will be consistent with the provisions of Section 9 (e).”

    The board also approved adding the following language to the end of the document titled “Process of selecting a president”:

    "The president-elect will be on the board currently, on the slate for election to the board, or appointed to the board, ex officio, for a term of one year prior to being elected by members. The term of the president-elect will be from July 1 in the year preceding assumption of presidential responsibilities until June 30 of the next year.

    There are no formal duties for the president-elect although he or she shall be a member of the executive committee of the board."

    If further comments requiring consideration and change are not received beforehand, at the board meeting on May 30, the board will perform its annual review of policies and adopt them for the next year.

    Your comments and questions are welcome

    A webcast is scheduled for June 19, 2014 at 2:00 p.m. Eastern to review all of the policies. Comments and questions are welcome at any time. The board and management take the adopted policies and procedures very seriously in guiding the responsible and consistent action of the organization.

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