This article is by Sean Kosofsky of Mind the Gap Consulting.
While the nonprofit sector is incredibly diverse in how we operate, there is one key position nearly every staffed organization needs: the nonprofit Executive Director or CEO.
Unfortunately, many nonprofit leaders—along with their board and staff—do not have a clear understanding of the executive director’s role, responsibilities, or job description.
This is a mistake and a missed opportunity. Everybody inside a nonprofit should know what the executive director does. It’s time to pull back the curtain and demystify the role.
Why You Need a Clear Executive Director Job Description
Lack of clarity in an executive director or CEO’s role can lead to internal and external challenges. These include misaligned expectations, internal dysfunction, and limited ability to achieve your impact goals.
In my consulting work, I’ve found that when employees and board members learn the specifics of the executive director’s role, there is a newfound appreciation for what these leaders do. Similarly, when the executive director is clear on their goals and role, they are empowered to succeed.
One tricky point though:
The executive director role will look slightly different in every organization.
This is okay! I have been an executive director for five different nonprofits, all of them very different.
The key is making the executive director’s role clear from the very start. That includes a solid job description (you can start with my customizable executive director job description). You also want to keep that job description updated and shared with the board and staff.
If you are hiring a new executive director, the job description is also important for making sure you find the right person for the role. If the job description is too vague, applicants may have a very different idea of the work and responsibilities involved.
For example, some new executive directors are drawn only to doing program work because it is sexy and rewarding. Others will cling to the administrative or operations work and ignore fundraising.
To be successful, the vast majority of nonprofit executive directors will need to push out of their comfort zone. They cannot outsource or delegate the unpleasant parts of the job (at least not forever).
To help you get started, in this article, I want to go through the 10 key roles of every executive director. Think of this guide as the background to help you craft and customize the most effective job description for your current or future executive director.
Executive Director Role #1: Leadership.
The board technically governs a nonprofit, but the executive director (sometimes called the CEO in nonprofits) runs the day-to-day operations. That means all organizational stakeholders see the executive director as the most visible and clear embodiment of organizational values and commitment to the organization.
The executive director was hired to get results. This means they have to make tough decisions, while also modeling good behavior.
Being a leader, almost by definition, means you won’t be liked by all people. But ideally, you will be respected by most.
The executive director should be able to:
- Articulate the nonprofit’s vision, mission, theory of change, statement of need, unique value proposition, and overall strategy and direction of the organization.
- Build alignment across the organization. This doesn’t mean everyone must agree on everything, but everyone should be rowing in the same direction. If this isn’t happening, it’s the ED’s job to uncover the misalignment and make the correct adjustment.
- Serve as what I like to call the “Chief of Enthusiasm and Optimism.” This definition of a nonprofit CEO emerged from my experience working in political campaigns. In any campaign, even if the candidate is going to lose, they and the campaign manager must exude hope, optimism, and a bold vision, or your base of support will dry up. It is the same for executive directors. Donors, volunteers, and staff will have lower morale and probably leave if the executive director is not also this kind of CEO.
- Embrace ambiguity. The executive director must also be comfortable embracing ambiguity because sometimes they need to proceed when the field ahead isn’t obvious. Leadership means being able to navigate or avoid dysfunctional conflict (personal and emotional) while embracing functional conflict (professional and healthy disagreement about strategy and direction). Leaders also should work to interrupt groupthink and mission creep. They should be aware of group dynamics and foster healthy differences of opinion.
- Ask hard questions. Executive directors should be attuned to cognitive biasesthat distort organizational decision-making. Leaders should ask: “Are we doing things right, or are we doing the right things?”
Executive Director Role #2: Fundraising
Fundraising is the one part of nonprofit leadership that I routinely see executive directors try to give away. Yes, the board and staff have key fundraising roles. But at the end of the day, the executive director must provide fundraising leadership and ensure the funds are there to execute the budget.
The executive director is responsible for creating the conditions for fundraising success (vision, materials, pitch, call-time, training, technology, etc.).
Executive directors should be providing direction while making themselves available to the development staff and board development committee. I am also a firm believer that nonprofit boards need to fundraise, though executive directors and staff will need to actively support that board fundraising.
There are, of course, a few fundraising roles that executive directors cannot delegate. For example:
- Donors often want to talk to the executive director, not necessarily the development staff. Especially with major gifts, the executive director should be the person bringing in the most dollars from major individual donors. In practice, this means the development staff set up the meetings, but the executive director closes the deal.
- The executive director makes the powerful pitch from the podium at a gala or other major event. The executive director does not need to be a charismatic extrovert to accomplish this. But they must know how to effectively persuade people to dig down and contribute.
- The executive director creates a culture of fundraising. This means making sure board and staff can tell the organization’s story well. It also means helping create as many “right places at the right times” fundraising moments.
Every executive director position I have been offered (five) has probably been because I promised to do what the other applicants hated: fundraising.
I have heard every possible excuse for avoiding fundraising. “I was brought on as a subject matter expert,” or “I was told I didn’t need to fundraise,” or “We have an endowment.”
Resist the temptation to succumb to these excuses. Step into your leadership and become a great fundraiser.
Executive Director Role #3: Board Development
The board owns the nonprofit.
That’s uncomfortable to read, but it’s true. All not-for-profit corporations are still corporations, and all owners of all corporations are responsible for revenue. It’s corporate law.
The executive director works in partnership with the board and for the board. However, because the executive director is staff, it is considered a best practice to assist the board in their operations, administration, planning, and information dissemination.
Executive directors should help build, sustain, and strengthen all board functions, like meetings, policy compliance, and committee work. The executive director should work to build alignment while also maintaining role clarity (division of labor between the board/chair/CEO).
The best investment an executive director can make for their own tenure is supporting the board and building rapport with board members, especially the board chair.
Executive Director Role #4: Financial Management
An executive director must demonstrate competence in reading, creating, and understanding financial documents, including budgets, cash flow, income statements, balance statements, and statements of functional expenses.
The executive director does not need to understand bookkeeping software. But they do need to understand the financial picture.
This means being familiar with the basics of 990 tax returns, audits, and compliance. Creation and adherence to financial controls are also important.
If this is all Greek, then the executive director should get some training. My favorite company for helping nonprofits is Fun with Financials.
Executive Director Role #5: Human Resources (HR)
When it comes to human resources, the executive director must ensure that onboarding, recruitment, retention, management, development, and compliance are carried out with excellence.
This means the executive director is responsible for delegation, decision-making, creating clear staff roles (job descriptions), and supervising collaborative tasks (projects/meetings) to ensure that they are done efficiently, inclusively, and with respect.
Some executive directors hire a deputy director to help with this, but ultimately it is still the CEO’s job.
Executive Director Role #6: Diversity, Equity, and Inclusion (DEI)
In seeking to achieve the organization’s mission, executive directors will constantly be challenged by questions of diversity, equity, and inclusion. Your organization is better positioned for mission attainment, funding, and building your base if you make this a priority.
Increasingly, community stakeholders will expect your organization to be making progress so that women, people of color, LGBTQ people, people with disabilities, or religious minorities don’t feel disrespected, excluded, or isolated in their roles.
Many organizations believe that if they simply prohibit biased behavior, they have done all they need to do. But we live in a culture that is filled with insensitive comments, implicit bias, and unequal treatment.
We owe it to the people we serve (and to everyone else) to dismantle these inequities whenever possible. This is hard work, which means it requires a certain level of humility, patience, and diligence to root out oppressive and biased patterns.
DEI work, at a minimum, may take the form of respecting the pronouns people use, noticing if women and people of color are being interrupted or passed over in group conversations, and ensuring that you compensate people fairly.
It may mean training, ongoing conversation, and learning. But it is not, I repeat, it is not some optional add-on.
You cannot reach your mission without DEI work, because if you try, you will leave people behind and you will never attract the top talent to your team.
Executive Director Role #7: Operations and Technology
Executive directors must create the conditions for success at all levels within the nonprofit. This means:
- Ensuring the organization operates correctly and functionally. This means vendors and staff get paid, obligations are met, meetings aren’t missed, and you have safe working conditions or physical space for your service population.
- Ensuring proper hardware and software are in place for fundraising, collaboration, document creation and storage, communication, productivity, and record keeping.
- Creating and maintaining policies to ensure the use of the most relevant and efficient technology and planning/budgeting for upgrades needed for future success.
Executive Director Role #8: Programs and Activities
Executive directors must work with the board, staff, and other stakeholders to ensure that the mixture of programs and activities is achieving the organization’s mission.
CEOs may not be “in the weeds” on program matters, but they should be creating the big picture with the board, while also ensuring the quality and effectiveness of each program and activity. This comes with internal and external expectations.
- Stakeholders expect the executive director to set the organization’s strategy and achieve outcomes. This includes tackling big-picture strategy questions, like balancing charity vs advocacy. For example, should the organization feed the hungry or work to end hunger or both?
- The executive director needs to ensure the nonprofit’s strategic vision is clear to internal and external stakeholders. For example, in a nonprofit strategic planning process, the board, executive director, and staff all have key roles to play. However, the executive director is responsible for serving as a liaison between the board and staff to ensure implementation of the plan.
- Deploying staff most effectively is essential. Staff play a key role in the day-to-day leadership and implementation of programs. Their technical and subject matter expertise is vital to an organization’s success. Remember, just because you are responsible for overseeing almost everything, doesn’t mean you have to know everything.
- Leaders of nonprofits must be open to accountability from stakeholders. If you are naturally defensive, you may end up isolating yourself. People appreciate authenticity and vulnerability on your journey as an executive.
- The executive director should also be an industry thought leader and be on top of the trends and developments in your sector. This usually just happens in the normal course of the job, but you’d be surprised (or maybe not) how many leaders get stuck in an old way of doing things.
Executive Director Role #9: Community Relations and Communication
The executive director should develop and maintain strong relationships in their sector and their region, with peers, donors, industry associations, the media, and more.
Strong and strategic nonprofit leaders build alliances and strategic partnerships. Executive directors should be collaborative with other organizations and be transparent.
Make sure you communicate regularly with stakeholders and the public. Normally this comes in the form of regular impact reports, an annual report, public events, or newsletters.
If you are too insular, you will miss many opportunities to help your organization and your own career. When you engage the public, you’ll find future donors, leaders, and volunteers. If you keep your head down in your work, you’ll miss it all.
Executive Director Role #10: Compliance and Best Practices
As an executive director, your job is to get results while minimizing risk to the nonprofit organization.
Stay in compliance with all laws and regulations. Create systems to monitor all of this. Even beyond legal compliance, ensure your organization is meeting the highest standards possible for your industry and region.
Be sure you understand the legal frameworks of creating and running a nonprofit. There are federal rules to follow from the IRS and elsewhere. There are also rules in the states you are operating or are incorporated in (if they are different), and there may be local rules as well.
Finally, being a successful executive director requires having good judgment. None of the tasks outlined in this guide are easy. They certainly can’t be checked off on a list.
Leading a nonprofit organization is a juggling act. Sometimes you will fail, and that is OK. No one runs an organization or a company without mistakes. Running a nonprofit should be joyful. Sure, it can be stressful too, but by keeping a bird’s eye view on the 10 areas outlined here, you can safely say you have done what you were hired to do.
For more support, you can grab the Top 10 Responsibilities of a Nonprofit Executive Director Infographic that goes along with this blog post and my Free Executive Director Toolkit.