Chapter 4 When Management and the Governing Board Disagree – Best of Boards, 2nd Edition

Chapter 4
When Management and the Governing Board Disagree

Martin is an investment banker. His firm encourages partners to become involved in the local nonprofit community and in service projects. Because of this and his interest in eradicating child abuse, he agreed to his nomination for the board of a local family violence prevention agency. The nonprofit was excited, too. The executive director and board president were eager to bolster the “money know-how” on the board and anticipated that Martin might be willing to serve as treasurer in the future. In the meantime, they assigned him to the Finance and Investments Subcommittee (FIS). At the first meeting of the FIS, Martin was astonished to find that the agency had exclusively allocated its investments to highly restrictive socially responsible funds. Although his plan had been to be a silent “learner” until he got more familiar with the board, he could not contain his discomfort. "Look, I’m all for socially responsible investing, but you also have to look at return on investment and diversification. You are missing a lot of opportunities for income that you sorely need. It seems irresponsible to stick with this investment plan."

Martin’s lecture was met with silence, but the air was filled with the unspoken reactions of others around the table. One committee member thought, "Who the hell does this guy think he is, coming in here and telling us what to do?" Another thought, “This is the classic corporate patriarchy! I don’t know why we keep recruiting these people for our board. They just don’t get what we’re about.” Still another thought, “Good luck, buddy. I’ve already tried that. It’s like hitting your head against a wall.” The executive director and subcommittee chair both winced. They privately agreed with his position but knew he was taking on a sacred cow that had consumed the board’s deliberations for over a year. On the other hand, maybe his position would help tip the scales toward change that had eluded the FIS thus far.

As in most areas of life, opportunities for conflict abound in the nonprofit sector. Board members may disagree with one another about CEO candidates, new initiatives, or assuming a particular level of financial risk. Members of the management team may clash with each other about strategic directions, budget priorities, or recessionary cuts. Board members and paid staff may conflict over fundraising prospects, organizational growth, or the cultivation of new board members. "Conflict may be defined as a struggle or contest between or among individuals with opposing needs, ideas, beliefs, values, or goals….Conflict exists even if only one person perceives it." 1

Although there are limitless possibilities when it comes to the parties and issues that give rise to disputes, the strategies for dealing with them follow only a few well-worn paths:

  • Concerns go unaddressed but are raised in private conversations, creating distrust and subterranean alliances. These coalitions and disingenuous communications affect group functioning in the short term and can create lasting schisms that affect team performance.
  • Conflicts are avoided, but then they erupt in new forms unrelated to the issues at hand. The group then focuses on the immediate issue and misses (or avoids) the chance to address the deeper, underlying conflict.
  • Difficult issues are raised but are belittled, papered over, or discussed at length with no apparent resolution. The spokesperson is eventually marginalized as a malcontent, idealist, stick-in-the-mud, bleeding heart, or partisan.
  • In an effort to maintain harmony, conflicts are avoided. Members focus on areas of consensus and avoid difficult decisions. There is a superficial feeling of comfort often to the detriment of the organization.
  • Difficult questions and topics are raised in the proper time and setting, issues are aired, members are heard, options are considered, and decisions are made in keeping with the board’s agreed-upon practices.

How can organizations such as Martin’s move from conflict avoidance to conflict management? How can difficult conversations be initiated to foster the best possible outcome in the event of disagreements? And ultimately, what options exist to address schisms that arise between elected and appointed nonprofit leaders? This chapter draws on the literature on intrapersonal and interpersonal perspectives on conflict to help the reader weigh options and strategies for successfully resolving governance conflicts. The dilemma facing Martin may also be construed as one of strategic change management, inviting the use of other concepts and tools for resolution. These strategies are introduced and applied in chapter 10.

The Head Game

Why are conflicts so often avoided or mismanaged? To paraphrase the comic strip Pogo, “sometimes the enemy is us.” Most of us are simply conflict averse. Conflicts create friction and tension when we would much prefer friendliness, warmth, and ease in our relationships. Conflicts are uncomfortable. They create stress, trigger fear, and ignite our competitive urges. Addressing conflicts head on can invoke negative stereotypes and labels: the complainer, the nit- picker, the contrarian, the person who just couldn’t leave well enough alone. Although the title of this chapter is “When Management and the Governing Board Disagree,” at their essence these are disagreements between people, and thus they are unavoidably personal and laden with meaning. The classic response to conflict is “fight or flight,” 2 though Algert and Stanley cite research that indicates women may be predisposed to a “tend and befriend” response instead. Conflicts cannot be avoided, and even with outstanding skills, they may persist. The key is to develop the mindset and abilities needed to manage them and keep them from exacting a destructive toll on the work of the organization or unit.

Beyond acknowledging the ways in which conflict itself is a deterrent to action, a second part of the head game involves understanding our individual responses to conflict. Thomas and Killman developed a classic instrument for appraising conflict management styles across axes of assertiveness and cooperation. 3

Most individuals have a dominant or preferred approach for addressing conflict, and those approaches tend to cluster in one of five styles. Each style presents particular strengths and weaknesses, suggesting that we should consciously select and use a style for a particular situation, rather than default to the one that comes most naturally. For example, a competitive approach, in which one “pulls rank” or forthrightly states a position and stalwartly defends it, is most appropriate for high stakes conflicts or unpopular decisions. 4 At the other end of the continuum, avoidance may be the preferred strategy for insignificant issues, “no-win” situations, or instances when the timing is not right to take a stand. It is distinct from accommodation, in which one party concedes a point to keep the peace or to achieve a higher purpose or a longer term objective. Compromise involves a give and take, in which common ground is sought and each party settles for less than he or she might have hoped. In contrast, collaboration builds upon each party’s wishes and ideas, creating an outcome that is greater than the sum of the original positions.

Finally, beyond being aware of the antipathy toward conflict and the preferred style for managing it, each of us must be attuned to our own hot buttons and biases. Hot buttons are those statements and situations that trigger a disproportionate emotional response in us. Biases are our prejudices, presumptions, and preferences (some examined, some not) that influence the positions we take and the meaning we give them. The perceived put down, the loaded issue, the colleague who grates on our nerves, and the subordinate for whom we are willing to go the extra mile are all artifacts of our experiences, and they play themselves out in the present.

Self-regulation starts with self-understanding. Be attuned to the moments that incite intense reactions in you and examine their deeper meaning. What rests behind your response? What does the incident symbolize? Are you prone to attribute negative motives to others? Do you see any patterns in your reactions—distrust, sympathy, harsh judgments, rescuing, or pessimism? Next, enlist the help of others. Who among your trusted others (mentor, colleague, supervisor, partner, pastor, coach, or therapist) would be forthright in sharing insights about your blind spots and helpful to you in working on them? Develop a repertoire of alternative responses when you feel a bias creeping in or a button being pushed: count to 10, breathe deeply, manage physiologic responses, remind yourself that the outcome matters, or recite a mantra like “Calm. Connected.” Conflicts are often, by their very nature, high stakes situations. To effectively handle them, we must be at our best to call upon and use our skills and strategies to reach an effective resolution.


Effective communication skills are necessary to bridge the gulf that divides individuals in conflict. Although persuasive arguments or compelling oration are fine abilities, other communication abilities are more important for managing difference. These include active listening, reflection, empathy, inquiry, and self-involving statements. These can then be bundled into models to facilitate difficult discussions.

Most people speak better than they listen (and more than they listen). Even when we think we are listening, we are often constructing our reply or playing a tape (“I knew that’s how he’d react” or “If she thinks I’m buying that excuse again, she’s mistaken”). Both responses keep us from truly hearing what the other person is saying. Active listening requires open posture, attentive eye contact, and careful listening, both for what is said and for what is not said. It means creating the space of time and silence to allow people to get past the superficial to the meaningful. It requires patience to let others’ positions, concerns, and feeling unfold without interruption.

Active listening is demonstrated and augmented by reflection, empathy, and inquiry. Reflection involves restating what you heard the other say, thereby checking for accuracy and demonstrating attention. “So you see investing in socially responsible funds as an expression of our mission for social change.” Empathy involves hearing the other’s underlying message and feelings and being able to put them into words. It is akin to putting yourself in the other’s shoes. “It sounds like you worry that FIS is being hypocritical by investing in goods that contribute to the injury of women.” Active listening is also advanced by earnest inquiry. Questions are used to enhance dialogue and expand understanding. In this, open-ended questions are more generally more effective than closed (yes or no) questions, which can seem accusatory (“What industries would you rule out for investments?” versus “Do you object to investing in corporations that make alcohol?”). The communication skill of confrontation differs from the typical definition, which implies anger and argument. In this context, confrontation is a form of inquiry. It means calmly presenting contrasting messages in an effort to seek clarification (“You’ve said you are worried about the stability of our endowment, and you’ve also said you want high risk, low yield investments”). A final salient skill is the use of self-involving statements. In these, the speaker owns a position, concern, or feeling. “I’m discouraged that we keep revisiting this topic at each meeting without progress” or “I’m worried that we’re violating our fiduciary responsibility in making this decision without current data.”

It is crucial to note here the importance of regulated emotions and, related to them, tone of voice. Conflicts incite intense physiologic reactions. The failure to manage these, along with the emotions and cognitions that give rise to them, will undermine effective, constructive communications. And of course, tone is everything. You can summarize a position in a snappish tone or in a tentative one. A question can be posed in a curious tone or as a cross-examination. Empathy can be sincere or superficial. Self-involving statements can be offered with humility or domination. Confrontation can be curious or, well, confrontational.

A number of excellent texts are available to help leaders master high stakes interpersonal communications. They address the internal and external elements of conflict resolution and offer memorable frameworks for successfully utilizing communication skills. One example is “Situation-Behavior-Impact.” 5 This strategy requires description of the event, the behavior observed, and the effect it had on others. For example, “When we were discussing investment options, you turned away and started checking messages on your phone, and the rest of us felt disrespected and dismissed.” An alternative recommended by Patterson, et al., is “Content-Pattern-Relationship.” 6 In this, an event is linked to past events and the future health of the relationship. “This is the third meeting in a row in which we have discussed the investments without any progress. I’m concerned that people are checking out of the conversations and losing their confidence in the board.” These techniques are used to greatest effect when linked to change strategies, 7 which are addressed in depth in chapter 10.

A final significant element in communication requires avoiding detrimental communication skills. This involves more than simply eschewing incendiary statements and postures. Scott identified five errors, 8 commonly made with the best of intentions, that diminish the power of the message and the success of the sender. The first error is beating around the bush instead of calmly and clearly addressing the concern. Asking, “How do you think things are going between us?” rather than saying, “I’m concerned that you and I seem unable to agree on anything in our meetings” presents a false and deceptive opening that masks the true intentions of the conversation. In the second error, “the sugarcoated spitball,” the key issue is sandwiched between two compliments. 9 This both obscures the central concern and demeans all future compliments as simply a prelude to complaint. Similarly, with “too many pillows,” the message is softened to the point where the intent is lost. 10 In the fourth error, the speaker is so consumed by internal dialogue and expectations about how the conversation will proceed that he or she responds to that script instead of the conversation itself. As a result, statements are mechanistic or defensive in anticipation of reactions that have yet to occur. In the final scenario, “Machine Gun Nelly” unloads on the listener as a result of anxiety or a pent-up series of grievances, which fails to differentiate concerns or allow for reaction or damage control. 11

Constructive Norms

Successful conflict resolution in nonprofit organizations (NPOs) involves more than effective individual communications. It also requires a climate that supports respect, transparency, and straightforward treatment of differences. Several strategies help to foster positive norms in regard to conflict. Orientation for new board and staff members should address the organization’s values; policies regarding respect, diversity, and other matters; the expectations associated with various roles in the organizations; the short-term and long-range goals of the organization; and the processes for change.

Some organizations have articulated codes of ethics that specify expectations for employee and volunteer conduct. These documents serve multiple purposes. They set forth an expectation of integrity and fair practices, mitigate risk, enhance public image, create a culture set on “doing the right thing,” and provide guidance about steps to take when violations occur.12, 13 Regardless of whether an organization has such a code, individual units can adopt standards or ground rules for their operations. Algert and Stanley offer one such "Code of Cooperation for the Management Team:

1. Remember that every member is responsible for the team’s progress and success.

2. Listen to and show respect for the contributions of other members.

3. Criticize ideas, not persons.

4. Do not allow hidden agendas.

5. Do not allow collusion.

6. Strive for consensus.

7. Resolve conflicts constructively.

8. Pay attention; avoid disruptive behavior.

9. Avoid disruptive side conversations.

10. Allow only one person to speak at a time.

11. Ensure that everyone participates and that no one dominates.

12. Be succinct; avoid long anecdotes and examples.

13. Understand that pulling rank is not allowed.

14. Attend to your personal comfort needs at any time but minimize team disruption…" 14

Boards, teams, departments, and other groups can also create their own ground rules. Rather than simply offering a list of guidelines and asking for the group’s endorsement, thorough conversation about the rules and how they will be implemented can help members consider and internalize the expectations. For example, what does “confidentiality” mean? Does it mean that no one on the board talks about the organization outside the meetings? That seems draconian and at odds with the role of the board as ambassadors of the NPO. Does it mean that no one will discuss what happens in meetings? How then will decisions and context be explained to new members or those who missed a given meeting? Will viewpoints be shared without attribution? Will members be encouraged to share their personal insights and viewpoints outside the meeting but not those of other members? Might this lead to inappropriate communications about proprietary or sensitive information affecting the NPO? In any given group, the individual interpretations of confidentiality could vary along these lines. Systematic and detailed discussion clarifies divergent viewpoints and encourages buy-in.

After such rules are set, the group should revisit them regularly to avoid drift and evaluate the extent to which practices actually conform to the group’s intentions. Some boards will highlight their code or ground rules by posting them or having a distinct (laminated) sheet in each member’s packet. Others review the guidelines at the end of each meeting and ask for written, verbal, or electronic feedback about the climate and content of the meeting. 15

A final element in creating constructive norms about conflict has to do with the actions of those in power. Leaders (both formal and informal) play a role in both shaping the organizational culture and sustaining it. That is, by their actions they create a safe place for disagreement, model civil discourse, and remind others of the values and ground rules that guide the group. They can make observations about the communications taking place in the group and shape the process of discussions as well as the content. When leaders neglect this role or, worse, act in a contrary manner, they still shape group culture but in a manner in which conflict is mishandled.


Fisher, Ury, and Patton16 offer several recommendations for successfully negotiating the end to conflicts. The first is to avoid positional bargaining. When disagreeing parties stake out entrenched positions, it is difficult to then move toward agreement because any compromise is perceived as a loss. Further, the outcome or agreement may be achieved at the expense of the ongoing relationship and future cooperation.

The second step in successful bargaining is to “separate the people from the problem.” This involves separating the relationship or interpersonal issues from the substantive differences between the parties. To be successful, a negotiator must listen well and put himself or herself in the other’s place, perceiving the situation from that perspective without making presumptions based on his or her own fears and biases. This may be accomplished by inquiry and by seizing opportunities to defy negative expectations. If a veteran board member anticipates being challenged by the newcomer about the investment policy, the adept newcomer would empathize with the difficulties in crafting an investment strategy and ask the veteran his or her ideas about making it a less arduous process in the future. “Imbedded in this strategy are the skills of being in touch with one’s own emotions, not reacting defensively when others express strong emotions, and communicating in a non-judgmental and non-inflammatory manner. When dealing with difficult people over difficult problems, the temptation is to avoid them at all costs. Symbolically, this raises difficulties in bridging the emotional barriers between the parties, and it raises practical difficulties because people are naturally suspicious if they feel they haven’t had sufficient input into a given plan. When the urge is to withdraw, the best strategy is to reach out.” 17

The third step involves moving from positions to interests. This requires taking proactive steps to find existing areas of agreement, uncover different but complementary needs, and recognize multiple interests so that areas of disagreement are minimized and a greater range of possible, mutually satisfying outcomes can be reached. It involves looking behind the positions of each participant and behind the emotions and statements to ask the questions why and why not. “Why is it important to invest in socially responsible funds?” “Why won’t she support other investments?” “What interests of hers stand in the way of saying yes to my suggestion?” “If she agrees to my request, what are the possibilities for her? What if she says no?”

A deeper look behind Martin’s position might reveal his concern for the costs of selective investing and the poor rate of return, especially for a small agency with few resources and such a vital mission. The veteran board member’s interests may reveal that she fears FIS will appear hypocritical if it supports violent and unhealthy industries, and that she thinks scarce resources shouldn’t be used to invest in industries that harm, on a large scale, the women FIS serves. In this case, the concern for FIS’s clients is shared by both parties. Both are also interested in wise use of scarce resources. Based on these mutual and complementary interests, they might agree to look at data on the different funds available to see if any maximize return while avoiding troubling industries. They might also consider other ways for FIS to exercise its social change ideals apart from its investment strategy. Perhaps the additional dividends from a better performing fund could be used to support social change efforts. These might ultimately have a greater impact than withholding a meager endowment from a particular mutual fund.

The fourth step in the negotiation process involves inventing options for mutual gain and avoiding premature solutions. This does not mean that mutually acceptable agreements should be deferred but that it is dangerous to offer premature criticism and premature closure. As Fisher, et al., put it, “Judgment hinders imagination.” 18 The discomfort of disagreement can lead either party to accept the first viable option, if only to draw the conflict to a close. Agreeing to forestall a decision and to make a concerted effort to generate a range of possibilities helps keep participants from viewing the negotiation as a zero-sum game and allows innovative, mutually beneficial options to emerge.

The fifth element in negotiating conflicts involves the selection and use of objective criteria with which to evaluate the options generated. A board member and CEO may be in disagreement about the appropriate deployment of endowment funds, but such impasses can be unblocked if the parties can agree to external standards to determine their course of action. For example, they might agree to research the investment recommendations of similar agencies, their local coalition of providers, or their national association and consider those in making FIS decisions. In light of the varied holdings of multinational corporations, it might be difficult to achieve the purity in social investments desired by some on the board. Therefore, the board might agree to a balance between a reasonable rate of return and an acceptable type of investment. Discussing and setting these tolerance thresholds externalizes the benchmark away from individual board members and places it on agreed upon standards.

A final suggestion in difficult negotiations involves the use of “negotiation jujitsu,” 19 wherein one negotiator embraces the other’s positions rather than resisting them. In some ways this strategy is the culmination and integration of all the preceding recommendations. The skills for this step include asking questions, being open to correction, using silence, looking behind opposing proposals, and inviting criticism of your own proposal. Martin might approach the reviewer in the following ways (and remember that tone is everything!):

“I appreciate your concern that FIS support social causes congruent with our mission.”

“I agree that it’s important to be true to our organizational values in everything we do. Are there some areas besides investments in which that is difficult to do?”

“What do you see as the shortcomings of more robust investments?”

“I’m concerned about FIS’s finances, as I know you are. How did that play in to the investment strategy?”

“Can we agree on a plan that will maximize the use of our funds without betraying our mission?”

Beyond the steps in conflict resolution process, Fisher, et al., recommend that each party develop his or her BATNA (“best alternative to a negotiated agreement”), which serves as a basis by which to evaluate options. 20 Establishing a BATNA requires thinking carefully about what will happen if the parties can’t reach a negotiated agreement and simultaneously serves as an impetus to engage in a process to reach such an agreement. Thus, establishing a “no agreement” position involves analyzing the alternatives at one’s disposal if agreement isn’t reached and anticipating what the other side’s default position might be. 21 If Martin and the others fail to find a mutually agreeable alternative, what are each person’s best possible options? For Martin, it might be to accept the investment plan limitation for the time being and work on it as a longer term change process. Alternatively, he may feel that the decision is so flawed that he can no longer serve on the board. The BATNA for board members who favor socially responsible funds is that status quo. Clearly, not reaching an agreement hurts Martin more than the veteran board members. This illustrates the fact that the better one’s “no agreement” alternatives are the more power they have in the dispute. In fact, the quality of one’s BATNA may determine whether he or she is willing to negotiate at all.

It is important to recognize that BATNAs are not static. Negotiators can take steps to improve their options and shift the balance of power. For example, if Martin decides to defer the battle over investments to a later time, in the interim he may accrue more legitimacy as an important, knowledgeable contributor to the board. His increased stature may move others to his position or make the risk of his resignation a more troubling prospect. External conditions can also alter non-cooperative alternatives. Failing endowments, court cases alleging NPO boards with lax financial oversight, and other events may shift the power to Martin’s position and away from the status quo. The issues of power and power differentials are addressed at length in chapter 10.

Assisted Resolution

Sometimes, conflicts are so entrenched or serious that they require assistance from an outside party for successful resolution. Alternative dispute resolution (ADR) refers to options that rest outside of the legal system and are alternatives to legal remedies. The two most common strategies are mediation and arbitration. Participation in either can be compulsory or voluntary, and their results can be binding or nonbinding. In both models, a neutral third party gathers data, hears positions, and identifies common goals. Mediators may also address the emotional elements of the dispute and help the parties to better communicate, thus facilitating better conflict resolution in the future. Some mediators may suggest novel solutions to entrenched problems and encourage the parties to do the same. The primary difference in the ADR models is that the mediator’s role is to help the disputants find common ground and a mutually acceptable outcome. Arbitration results in a ruling or decision by the third party rather than by the individuals in conflict.

There are a number of advantages in ADR; perhaps foremost among them is the effort to preserve the relationship between the parties while crafting a practical outcome that is responsive to their respective interests. The disadvantages can arise when one party is not behaving honestly or sharing all pertinent information. ADR is also compromised when one party is passive or easily intimidated by the other.

NPOs may engage third parties to assist with a variety of challenging issues with the hope of avoiding or addressing conflict. Consultants may assist leadership with strategic planning, compensation studies, merger and acquisition decisions, and other matters. An ombudsman’s services may be invited to deal with ethical issues, interpersonal frictions, or staff-management disputes. Some consultants and ombudsmen can facilitate negotiations and mediate disputes, or the NPO may retain specially trained mediators to assist with conflicts.


Despite his best intentions, Martin may have violated committee norms from the outset by speaking up forcefully as a newcomer on the board. As such, he may have alienated other, powerful members and discouraged possible allies from speaking up. If his intent is to encourage the committee to reconsider its investment plan, he must begin by healing the rift from his initial meeting. Many of the skills and strategies advised in the preceding paragraphs would serve him well. First, he must apologize, acknowledge that the other committee members have a far deeper history with the issue than he, and adopt a stance of inquiry to learn about the positions of others and the options they have considered in the past. He should also allow time for the committee members to get to know him. As they understand his concerns, intentions, expertise, and dedication to FIS, his input will have more value. If Martin’s concerns about the investment priorities continue, explicit change strategies (chapter 10), negotiation, or mediation may be required in order to bring the conflict to a successful end.

Martin may also face a common question that plagues conflict resolution: “Is it worth it?” To answer this, one must consider the alternatives. Conflict resolution strategies are well regarded for use in a variety of situations in which the emotional, financial, and personal stakes are high, such as divorce, child custody, and victim and offender confrontations. The alternatives to attempting collaborative agreement are unpleasant: harboring feelings of anger, frustration and powerlessness, having to invest further energies as disputes crop up in another form, or withdrawing from disagreements altogether and just “doing time.” The last option is a dangerous precursor to burnout and an abdication of the individual’s ethical and legal responsibilities to the organization. As a volunteer, Martin has the option of resigning entirely from the board. This may seem like an easier path than addressing conflict or being a passive member of the board. Unfortunately, leaving in the midst of a dispute may prove unsatisfying and ultimately more troubling than staying to work it out. If he resigns, can Martin really let go of his concern for FIS’s decisions? Even if Martin can resign with a clear conscience, quitting may be in his interests but not in FIS’s. Conflict is a part of everyday existence. Family life, corporate life, and civic life all rely on the ability to bridge differences of opinion and the willingness to try. Sometimes, it is necessary to vote with one’s feet, but resignation at the first sign of resistance diminishes the individual and the systems of which he or she is a part.