There are pros and cons to board term limits, for sure. Knowing that, organizational leadership must chart its own approach to the issue, weighing unique circumstances in the organization's development. But I must admit, I have my own preference.
What are the pros and cons of term limits?
The Pros
With term limits a board can refresh itself over and over again, gain many new insights and renewed enthusiasm.
A board can say goodbye to those individuals who have not shown adequate interest or have not performed well--no hard feelings, there are term limits.
Time affects every organization: what was needed once in the life of the organization may not be needed currently--terms give the organization an opportunity to align new knowledge with current needs.
Term limits enable groups of board members with insider attitudes to rotate off the board; self interest is not sustaining as a result.
The Cons
No doubt that with term limits, when a board member rotates off, institutional memory is eroded on the board.
Dedicated volunteers--and often strong donors and supporters--are also sometimes lost and this deprives the institution of their support and dedicated knowledge. A true loss.
What Is Critical?
There is no doubt that rigorous evaluations of the board must be done on a regular basis, preferably by an outside organization.
If board members are valuable and you don't want to lose them, then perhaps considering allowing board members to rotate back on after a period of non-involvement is a good solution.
Never let a good person and volunteer get away. Perhaps considering giving them the "honorary board member" or "emeritus board member" title is a good approach, inviting these members to participate in special initiatives like recruitment of leadership for the organization, leadership involvement in a capital campaign, legislative advocacy, in other words, a place of honor in collaboration with current board members, etc.
Board Members and Philanthropy
There has never been a period more important for philanthropy than during and following this epidemic. An organization needs to rely on its trustees more than ever, not only for their financial commitment, but for their help in fostering and deepening relationships with high level donors.
Donors are far more likely to get involved if a respected board member invites them.
This circumstance argues for ensuring that board evaluations are regular, that outstanding board members be retained, stewarded and cultivated for future roles, and that the board be refreshed regularly with interested, influential members of the community. This is vital.
A Short Story
I saw the need for term limits on a first hand basis when I was introduced to a regional volunteer board representing an outstanding institution in North Carolina. These were not my clients, but I was doing a favor for a long standing colleague and lending an objective view of the very complex situation.
As I learned, the institution did not always have a recognizable name and the mission was important but not well known. In the first years of the organization's existence, there were some very fine individuals who stepped in, forming a loosely defined board, to determine how to remedy that and begin to bring a critical mass of resources to the situation.
A few years into their tenure they recruited a corporate executive and asked him to chair the board. With his executive experience, he knew how board meetings are conducted and proceeded to ensure that the approach was very professional. This was a wonderful contribution to launching a meaningful board and provided a solid platform for success.
However, there were no term limits. Not for board members and not for officers. The then Executive Director and board chair argued for the fact that they were unnecessary.
A problem slowly and persistently began to emerge as the next 20 years went by. The executive was firmly ensconced in his role. He was influential, his corporation was supporting the organization, and no one wanted to offend him. He continued to chair the meetings and, although there was a nominating committee, he continued to choose the board members, many of whom were his friends. And, of course, he wanted to ensure that he never offended any of them by asking them off of the board--dead wood stayed on although they didn't attend meetings and were not involved in a meaningful way. Little or no diversity existed.
Although the fundraising program began to grow rapidly in importance (less state funding available required a more professional development team to raise private funding), he wanted to ensure that his friends were not asked to give, providing a distinct disadvantage to the development team.
He dominated the meetings with his own agenda and refused to provide a meaningful role for other board members. To further protect his position of power, over time he cultivated some very unhealthy attitudes, some might say, attitudes laced with self interest. Conflicts with staff and executives became more common with some staff members leaving their positions as a result of their involvement with this individual. In other cases he formed alliances with powerful executives internal to the organization and succeeded in protecting their agendas whether in concert with the needs of the organization or not.
Of course, there are solutions to such an issue, but because of the time involved (more than 25 years) and the duration of his organizational friendships, few of his executive friends within the organization wanted to rock the boat--and they persuaded the overall system's CEO to do the same. So no action was taken. As a result, the organization lived around him and just could not be as effective or as powerful as its mission should have inspired.
In conversations with the executive team, the executives of the organization and the staff readily admitted to each other that having terms of service would have mitigated this problem. The Executive Director was most forthcoming of all. He had been recruited in the last three years so he inherited the problem. He called recently and told me in utter frustration that he would never allow another board to go forward without term limits as a result of his experience with this organization.
I will readily admit that this situation is the extreme, but it surely adds a note of caution to such decisions at other organizations.
In Conclusion
So when the options are there, having term limits for board members (and officers) can be a very important choice. Ensure that there is a role for those excellent board members who do rotate off as a result of the term limits, cultivate them, keep the most outstanding people and continue to recruit excellent volunteers for the future. This approach can truly be a sustainable advantage for the organization.