When establishing subcommittees you also need to be conscious of who will be appointed to the subcommittee and who will be the chair.

As previously mentioned, the benefit of a sub committee is that it can spend more time being focused on the purpose for which it was formed.

It is important that you understand that even though it is a subcommittee of the main board, you as a board member, have not transferred the responsibility and accountability to the subcommittee.

One mistake often made by board members is thinking that the subcommittee is solely responsible for the decisions it makes, and therefore they don’t need to understand the issues or the implications of the recommendations that are made. They are wrong.  Can you imagine the rest of the Merry Men not paying attention to Little John’s subcommittee decisions about arrow supply?  Those decisions affect the entire group so it is everyone’s responsibility to understand what those decisions mean.  In the case of Robin Hood and his men, it could be a life or death decision.

As a board member you must understand all the issues and, if not, then it is your responsibility to become educated.  This may form part of the board review process and be incorporated in a board training program.  In addition, the finance specialists of your not for profit organisation may provide additional resources to guide and help members understand the complicated financial recommendations.

The core membership of the subcommittee should include people who have a detailed understanding of the issues related to the subcommittee, but it also should have a board member who may not be as skilled on the issues but is able to provide a different perspective.  This provides an opportunity for the board member to be educated on the issues while sharing a fresh point of view with the rest of the subcommittee.

The Treasurer for the organisation, and therefore the chair of the Finance Subcommittee, should have good experience with finance and accounting and fully understand the role they are performing.  If the board decides there is not enough expertise to adequately discharge the responsibilities of the subcommittee then there should be the capacity to appoint an external expert who can provide relevant advice and assistance.

Do you have a Finance Subcommittee in your not for profit?