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When the Senior Leader of Your Non-Profit Unexpectedly Resigns – Three Safeguards Boards Can Enact

It was an unforeseen, and serious, complication for the board of directors.

After the mid-size charitable organization had navigated a series of challenges through the pandemic, the long-time executive director tendered their resignation. It came with an additional challenge. This individual had surgery scheduled within a few weeks. There was no flexibility for the date of departure. The board of directors had less than two months to find a new organizational leader.

This situation is far from unusual. While resignations of all staffing levels surged during the pandemic amid uncertainty and stress, the number of executives who resigned between January and September 2023 increased 50% from the same period the prior year. This is the highest rate for this period since US firm Challenger, Gray & Christmas started tracking this statistic more than 20 years ago. 

Notably, the number of CEO/ED turnovers was highest in the non-profit and government sectors.

While these figures apply to the US, anecdotally it would appear that Canada is experiencing a similar scenario. Part of this trend is attributable to retiring baby boomers. Within six years, the youngest of this generation will turn 65.

Why is this a concern for boards of directors of non-profits?

Because hiring a CEO or executive director is a critical, complex and time-consuming undertaking. And many boards are inexperienced and unprepared to assume this responsibility.

At the same time, a well-executed executive search and placement typically requires at least four, and sometimes up to six or more months.

So when a non-profit faces the unexpected resignation of its operational leader, there are too many instances where the organization finds itself leaderless or the board appoints an unqualified staff member to assume the role. Both situations can place extreme pressure on boards of directors as well as the entire organization.

Fortunately, there are three strategies that boards can leverage to prevent or alleviate this type of stressful and risky situation.

  1. Develop or revisit a succession plan, which should include contingencies
  2. Weigh the value of hiring an interim leader
  3. Evaluate the merits of utilizing the placement expertise of an external search firm

1. Develop or revisit a succession plan, which should include contingencies

If your non-profit’s senior leader were to resign immediately, what would the board of directors do? If you don’t know the answer, you need a succession plan.

And if you have a succession plan, but it hasn’t been updated in some time and doesn’t reflect the current situation, then it’s time to revisit it.

An effective succession plan should identify key positions in the organization as well as job descriptions for these positions. It should also identify any staff members with an interest in and potential for advancing into key positions. And it should provide a framework for developing their skills and transferring knowledge. The plan should also include strategies for assessing turnover risk and for planned and emergency vacancies.

You can establish an ad hoc nominating committee to manage the process or assign succession planning to the governance committee. Either way, the committee should provide input and guidance related to those who serve in leadership positions in the organization and should be responsible for recruiting and succession planning for the ED/CEO and board roles.

Committee members typically include at least one board director, the senior operations leader, and a high-level staff member or team leader. It can also be helpful to involve an experienced executive recruiter in the succession planning process who can provide insights into developing candidates internally or identifying potential external candidates for future needs. A professional executive recruiter can also help to create candidate profiles and lead the search for prospects if and when needed.

Since an organization’s needs change over time, the committee should regularly update the succession plan. Annual performance reviews are an ideal opportunity to do so, and help to align this plan with personal development plans for key employees.

2. Weigh the value of hiring an interim leader

Another aspect of succession planning to consider is determining the potential value of interim leadership.

Experienced interim leaders are becoming increasingly common in the non-profit world as senior executives retire and finding replacements tends to be a lengthy process.

In situations of unexpected leadership resignations, interim executives can help to stabilize an organization during this stressful period. They also provide a board with breathing room, giving directors time to manage a well-thought-out hiring process.

Whereas hiring the right permanent ED or CEO may take months, interviewing and hiring a qualified interim executive generally only requires a couple of weeks. Immediately stepping into a temporary role, they focus on helping the organization navigate through change, contributing extensive knowledge and leadership expertise to generate immediate impact.

Non-profit interim executives are skilled professionals who bring a fresh and experienced perspective. They utilize proven strategies to align staff and the board of directors and to develop solutions for the most pressing challenges. They can also help the board define the non-profit’s needs for the next leader, prepare the organization for this transition, and establish a foundation to set up them up for success.

While terms for interim leaders range from three months up to a year for situations such as parental leave, this tenure can vary widely, depending upon an organization’s priorities. For example, if the board wishes to leverage the departure of a long-serving CEO or ED as an opportunity to consider a major organizational change such as a review of programs or services, an interim leader can spend additional time helping the board examine these.

In fact, the professional, objective perspective of an interim executive can be invaluable in addressing both entrenched organizational problems as well as new possibilities. Because they aren’t embedded in an organization’s internal dynamics, these temporary leaders can offer an impartial review and expert knowledge to remedy persistent challenges or to move promising opportunities forward. This can be a major advantage for many non-profits.

3. Evaluate the merits of utilizing the placement expertise of an external search firm

Every non-profit board of directors wants to ensure an effective hiring process to find the right person for the senior leader role. But this is especially challenging in today’s post-pandemic environment characterized by an elevated level of retirements, intense competition for talent, a challenging economy and growing demands on non-profits.

Many boards of directors simply don’t have the capacity or the expertise to conduct such a demanding search. Hiring a non-profit leader is a highly specialized process. It encompasses detailing the  organization’s requirements for the role; identifying the responsibilities and qualifications for this role; developing a detailed job description; finding, qualifying and interviewing candidates; verifying  references; facilitating the negotiation process; and onboarding. These all involve significant time and knowledge.

By partnering with an executive search firm experienced in the non-profit sector, a board of directors gains access to a professional, objective perspective; an understanding of trends and best practices; a transparent, collaborative search process; an established and often extensive network of potential candidates; and tested search technology and strategies. These firms are also able to conduct searches confidentially, which can be important in a variety of circumstances.  

When working with an executive search firm throughout the recruitment process, board members participate in candidate interviews and evaluations and also provide guidance and feedback to the search firm, ensuring alignment with the organization’s needs.

Ultimately, the support of an executive search firm can help to streamline the recruitment process, freeing up board and staff resources to focus on core organizational needs.

While contemplating the departure of a valued senior leader may not be an appealing thought for many non-profit boards of directors, understanding that you have control over the process can be reassuring.  

A succession plan, interim leader and professional executive search support are three safeguards available to you that can help to ensure the continuing success of your non-profit.

Deborah Legrove, CFRE (2002 – 2017), is President of crawfordconnect and has more than 35 years of experience working in non-profit fundraising, marketing, leadership and executive placement. You can reach her at 1.866.647.5149 / 416.977.2913 ext. 233 or deborah@crawfordconnect.com.