No matter how great the leader of your non-profit may be, there will come a time when a new hand will take the helm of your organisation. Taking some time to plan for the eventual change in leadership of  your NFP is an important task, and the exit agreement is an indispensable tool for both the board and retiring executive.

A timely article has recently been published that provides helpful information on this subject for board members of non-profits. It can help them to plan for the retirement of their leader and help them to distinguish when an exit agreement is needed. It also includes additional information that explains the differences between a separation agreement and release, and the exit agreement.

Also covered are the many common scenarios where an exit agreement might be used, and the meanings of the four main types of exit agreement are explained: Catch up, Incentive to stay longer, Post retirement services and Honorific.

The article also includes key considerations that board members should take into account when drafting the exit agreement and planning how they will say “thank you and goodbye” to the departing leader. Some of these considerations include topics such as financial capacity, stakeholder dismay, and notification to the incoming leader.

The article should be considered a beginning guide for boards as they plan for the exit of their leader. A skilled solicitor and possibly an accountant should also be consulted as part of this process, to ensure that a legal and binding agreement is reached that does not void or come into conflict with any pre-existing contractual obligations.

To learn more about how to plan for the exit of your NFPs leader, please visit Exit Agreements for Nonprofit CEOs: A Guide for Boards and Executives.