Carl LaBarbera – Policy Governance for Nonprofit Boards

“Under Policy Governance, the Board’s role is governance – not management.  That is a critical element of governance.” -Carl LaBarbera

[00:00:00] Carl LaBarbera: I met a guy, Dick Berry, who was a professional in the Policy Governance arena. And once I took his class, I was convinced that this was what I needed to do board work. And the reason for that is because primarily my own work in aerospace industry, knowing that systems and procedures are essential to do any kind of job that’s going to be effective.


[00:00:26] Carl LaBarbera: And when Policy Governance was presented that’s the kind of system that I was seeing. And so, a complete, scientific system with procedures and thinking about all the elements of governance was something I needed.


[00:00:42] Tommy Thomas:  My guest today is Carl LaBarbera. I met Carl several years ago at his home in Southern California.  He was gracious to give me a couple of hours that afternoon, and we’ve maintained some loose contact with each other since then.  One of the areas of expertise he has is that of Policy Governance, and I’ve known that, from the afternoon I met him, so as I was thinking about more guests we could have in the area of board service, Carl was one of the ones I wanted to have, so thank you, Carl, for joining us this afternoon.


[00:01:14] Carl LaBarbera: Thank you, Tommy. It’s my pleasure to be here and look forward to our conversation.


[00:01:19] Tommy Thomas: Before we dig too deep into Policy Governance, how did you get interested in or involved in nonprofit board service?


[00:01:29] Carl LaBarbera: That goes back 40 years. So, it’s interesting. I don’t know how far back you want me to go.


[00:01:37] Carl LaBarbera: I can go back to my childhood because my dad had a company in inner city LA which is a very difficult area.


[00:01:48] Tommy Thomas: Back then, especially,


[00:01:49] Carl LaBarbera:   When I was a very young child, I was 11 years old when the Watts Riots occurred. And my mother and I were driving into the business in South LA.


[00:01:59] Carl LaBarbera: And the Watts Riots were underway. And my mom swears that a black woman flagged off attackers.  She was in front of us, and we were able to drive into the business, but we had no idea. The news was not like it is today.  We literally drove into it. So that obviously left a big impression on me as a kid.


[00:02:22] Carl LaBarbera: And I’ve had a heart for the inner city ever since. And we continued, actually, my brother and I took over the business that my dad had started and in 1957 after the war and in continued in that Watts area, but then we were bought out by the freeway and moved just slightly south of there in an area in Linwood, which is still South LA


[00:02:48] Carl LaBarbera:  So that connection of having a business in that community and actually knowing the neighbors in that community, in the Watts community, which was primarily African American gave me that heart. And then I was listening to Focus on The Family. I would wake up in the morning, six o’clock in the morning, with Focus on The Family on the radio.


[00:03:09] Carl LaBarbera: And Dr. Dobson was talking with Keith Phillips, who is the founder of World Impact, and talking about Watts. And I thought to myself, wow, that’s literally across the street. And so, I made a journey to introduce myself to World Impact. At the time it was a Canadian director who was leading that Watts ministry.


[00:03:33] Carl LaBarbera: And we got to become good friends in our company partnered with World Impact to help the missionaries in the Watts community and help them in any way we can to support them in their ministry.


[00:03:45] Tommy Thomas: Wow. That goes back a long way.


[00:03:49] Carl LaBarbera: We’re talking 1990s. Yeah. At the time I met him, it was late eighties or early nineties.


[00:03:55] Tommy Thomas: Did you have any kind of mentorship relative to board service? Did you have a model or a role model?


[00:04:03] Carl LaBarbera: I think, my interest in board work really began with our own company. That was the work that I love to do, having a 30,000-foot perspective, being able to work at that high level, conceptual level seeing all the pieces in an organization the teamwork necessary to make an organization successful.


[00:04:25] Carl LaBarbera: I got a hunger for that level of leadership in our own company, but where I was introduced to Policy Governance was at the Christian Management Association. So, I was a member of the association, which was called the Christian Management Association. Now it’s called Christian Leadership Alliance.


[00:04:44] Carl LaBarbera: And I met a guy, Dick Berry, who was a professional in the Policy Governance arena. And once I took his class, I was convinced that this was what I needed to do board work. And the reason for that is because primarily my own work in the aerospace industry, knowing that systems and procedures are essential to do any kind of job that’s going to be effective.


[00:05:11] Carl LaBarbera: And when Policy Governance was presented that’s the kind of system that I was seeing. And so, a complete, scientific system with procedures and thinking about all the elements of governance was something I needed. And then of course, serving with a friend from church who was an urban ministry leader when he started his nonprofit Urban Youth Workers Institute and asked me to join his board and chair his board, John Carver.


[00:05:44] Carl LaBarbera: It was like, what do I use to run a board? Because there’s really nothing other than best practice information as to how you actually chair and run a board, how you lead a board. And so that’s why policy governance just rung a bell for me, and I knew it was something I had to learn and be very good at.




[00:06:05] Tommy Thomas:  Get up at 50,000, 100,000 feet and look down. What’s the primary purpose of the nonprofit board?


One role of the Board is dealing with the risk factor.  Mitigating or at least evaluate risk to determine what’s acceptable and what’s not acceptable.


[00:06:12] Carl LaBarbera: Yeah, there is one, one primary purpose with two parts actually. And I can just simplify that to say get the mission done and stay out of trouble. So, there’s two elements. And what we say, what we call mission, and we call ENDS is what benefit for what people at what worth.


[00:06:33] Carl LaBarbera: So those three elements make up the mission or the ENDS. And then there’s the risk factor. So, a board is there to mitigate risk or at least evaluate risk and to determine what’s acceptable and what’s not acceptable but that’s the keeping the organization out of trouble part, right?


[00:06:51] Carl LaBarbera: So, get the mission done, stay out of trouble. That’s their primary purpose. And, but let me add that all that’s done on behalf of someone. Especially in nonprofits, in a corporation, right? You are beholden to the shareholders. A board works on behalf of the shareholders. There are no shareholders in the nonprofit world, but what Carver was smart enough to know is that we’re, the board is beholden to some, they don’t own the organization, the CEO, the staff, they don’t own the organization, who owns the organization?


[00:07:25] Carl LaBarbera: In the church, we say Jesus owns it. Of course, he owns it all, but Jesus owns the organization, which is cool because he left us a whole book of values that we know that we are beholden to, that we need to comply with. But secondarily, there are owners or what we call care holders or stakeholders on the organization.


[00:07:49] Carl LaBarbera: I could talk about the global church as owning a nonprofit. So, we need to be aware of the values of the global church. We could talk about those that the organization impacts. Not the beneficiaries so much, but the communities that would have an interest in the organization. So, when we determine who the owners are, the moral owners, we call them, who is interested in seeing this organization succeed, who is interested in the benefits that this nonprofit will bring.


[00:08:24] Carl LaBarbera: And those are the people that we are beholden to, not in a democratic way, not like we’re looking for them to give us majority rule direction, but in a way like a doctor or a lawyer would work in the best interest of their ownership. So, the client comes to the doctor. Obviously, the client knows something about their ailment, but the doctor knows more, they’re an informed agent.


[00:08:50] Carl LaBarbera: Or Robert Greenleaf would say a trustee. So, a trustee, their job is to follow the direction of the trust that is given to them. And that trust is the trust that the ownership holds. And so, the board is to determine what are those values and determine what is in the best interest of those stakeholders.


[00:09:12] Carl LaBarbera:  That derives a whole set of policies, which then give direction to the organization.


The role of the Board Chair is that of Chief Governance Officer – making sure that the Board accomplishes what is says it is going to do.


[00:09:21] Tommy Thomas: Under this model, what’s the primary role of the Board Chair?


[00:09:25] Carl LaBarbera: The Board Chair is called the C.G.O. So Chief Governing Officer.  So, the Chief Governing Officer, the primary role really is to assure that the board accomplishes what it says it’s going to do.


In a sense, the chairman is a manager of the board itself to assure that whatever they said they were going to do, because they have a role, they have a job description, and to assure that they get that job done. But I’d also say that the chair is the interface or maybe the primary interface with the CEO.


It’s very important that chairman has a really solid relationship with the CEO, that there’s a clear understanding that there’s complete communication on both sides in order for that chairman to do his job well.


[00:10:16] Tommy Thomas: Give me some words and phrases that maybe would describe the skillset that this chair needs to do his or her job well.


[00:10:25] Carl LaBarbera: Yeah, that really starts with character. Especially in a Christian organization, but any nonprofit really, but it’s the character. So that’s essential. I think essential elements are wisdom over a lot of experience, preferably humility is very important.


I think a humble leader, a servant leader. So, I love Robert Greenleaf and all his writing on servant leadership, and I’m deeply indebted to Robert Greenleaf and his description of what a servant leader does. So that chairman really needs to be that servant leader like Jesus commanded. If you want to be a leader in the kingdom, you have to be the least of all. So that chairman serves the board, and they serve the CEO and they serve the organization.


[00:11:13] Tommy Thomas: I know this would vary, but just from your experience, how often does the chair meet with the CEO to maintain this relationship and this esprit de corps?


[00:11:25] Carl LaBarbera: World Impact is a good example. And Alvin Sanders, the CEO, and I have a standing meeting once a week on a Monday morning. And we try to communicate with one another on a regular basis just to have that regular flow of communication, what’s going on in your world.


What’s going on from my perspective. And, of course, planning together what the agenda is going to be for the year and for the next meeting. All those things are critical and talking through what issues are important for the CEO to comply with the board policy manual.


The board has created, in helping that process.  A lot of times I need to help educate the CEO in the process of Policy Governance. Because there are not a lot of Policy Governance experts out there. And yeah, you don’t see that a lot. So, part of it is educating as well.


[00:12:19] Tommy Thomas: When you get a new board member what’s the best way to onboard this person?


[00:12:25] Carl LaBarbera: Yeah. The first thing we do is provide the documents that we’ve created. So, it’s really important for a new board member to understand the process, certainly. So, what is this process called Policy Governance? It’s very different from what most people experience. I think I know beyond several boards that many board members want to show up and display their wisdom and their good decision-making skills.


And that’s really not, that’s not what the board is all about. We want that, certainly, but the board needs to understand the process. The beauty of Policy Governance is that all of the things that need to be known are in a policy, a board policy manual, and that manual is less than 30 pages, and it covers all four aspects of what we would call the policy circle regarding CEO role the board role, the chairman role the interaction between the board and the CEO what the mission is and what the limitations are, the things that we can’t do as an organization, even if they worked, things illegal or unbiblical.


A good Board Policy Manual provides invaluable information for new Board members.  This manual is usually less than 30 pages.


So that board policy manual really provides invaluable information to anyone coming on board gives them all the information they need. They’re not going to get it all in the first read through, but all the information is there, and they can study that. And the other thing we do is, obviously we want them to know what the bylaws are and what the expectations are in terms of meetings, etc. So, it’s really just a quick update getting board members up to date on where we’ve been, where we’re going, and how we operate.


[00:14:14] Tommy Thomas: Let me ask you to get you to respond to this quote about a board service. Somebody said, “You need a director on a board who will be a pleasant irritant, someone who will force people to think a little differently. That’s what a good board does.”


[00:14:29] Carl LaBarbera: I love that because one of the things I strive for is called healthy, I call it healthy conflict. There’s probably a better word than conflict, healthy discussion, which means we really want honest feedback from all our board members. So having that, and we definitely have those.


A good irritant is someone who really is just thinking through. They’re thinking from their perspective, and they’re offering their perspective, and we need to hear it. Even if it’s opposed to the direction that, we think we need to go, we need to know who was it that talked about Ruth Haley Barton.


She talked about working together, finding God’s will together. And you really need in teams, and I think it’s any team, but including a board team, you need to know what the no people are saying. If someone’s really objecting to where we’re going, it’s pertinent on us to determine what God is saying to that person.


Why are they adamantly opposed? And if we don’t take the time to figure that out, then we’re neglecting our duty. As a board, so not again, obviously, you don’t always achieve consensus, but I’ve been in situations on boards where we have worked it through taking some time and ultimately say there are two people that maybe don’t agree, but they relent and say, we will submit to the wisdom of the board. And of course, one of the principles of Policy Governance is that we speak with one voice. After all the discussion and we finally get to the end of the day and we vote and some have to acknowledge that we don’t agree, but we are going to speak with one voice when we’re done with our work.  So that’s critical.




[00:16:23] Tommy Thomas: Your thoughts on bringing younger people in their thirties and forties onto a nonprofit board?


[00:16:30] Carl LaBarbera: Yeah, I would love to see that.  And I would love to see young people have that interest. My experience has been that young people aren’t the younger generation, millennials, maybe is my experience aren’t as interested in what they might consider business-like work. So, say in a church setting, right? Or even in a Christian ministry setting, this is a business job in which I really have a problem with that because I’m a firm believer that God owns it all that he works through business and churches and our ministry happens in all realms of life, right?


But that kind of perspective is, yeah, I don’t want to be involved in that kind of business process, but every time I’ve seen young people engage in the process, it is so helpful. So, I would be a big fan. Where do we find them? I have seen them in the governance organization governed for impact, which I’m a fellow with, and we have seen their young people take a real interest in governance.


And when they do, then it’s highly valuable. We need their perspective, right? This is where the world’s going.


[00:17:49] Tommy Thomas: For sure.


[00:17:51] Carl LaBarbera: Yeah. We need millennial perspective. We need Z perspective. Yeah, I value that. I wish we could get more of it.


[00:17:59] Tommy Thomas: I run into this a lot in my work and has to do with the past CEO being a member of the board when, when you bring a new CEO on, your thoughts just from so many years of experience that you’ve had any observations there.


It can be very difficult when a retiring CEO, especially a founder wants to remain as an emeritus Board Member.  That can restrict the ability of the new CEO to make mistakes and/or go in a different direction if that’s what the organization needs.


[00:18:14] Carl LaBarbera: Yeah, that’s tough. I’ve seen that in churches. I’ve seen it, I’ve seen it in other nonprofits. It’s just, it’s very difficult because when a CEO, who’s especially a founder, CEO or a founding pastor and wants to be an emeritus board member or emeritus leader, even that really restricts the ability of that new CEO to be free to make mistakes and go in a different direction to bring their unique skill set because each leader has a unique skill set and they should be allowed to use that.


And so I just, I see it often doesn’t work out very well. And you hear the phrase that you don’t want to be the next guy. You want to be the guy after the next guy. Because oftentimes that first guy is still hanging around and influencing where it’s going. And that could be debilitating.


[00:19:06] Tommy Thomas: This is probably in your Policy Governance manual but tell us about CEO evaluation.


[00:19:13] Carl LaBarbera: That’s an ongoing process. So, it is not a once-a-year process, although we do a summarized once-a-year process, but in the board policy manual the policies pertain particularly to the CEO or the executive director or the lead pastor. Those things that are called the Ends. So those are what benefits for what people at what worth. And then there are the executive limitations. And there are quite a few of those limitations, as I said before, that are not allowed, even if they work, because they’re illegal or biblical or other reasons.


And so, we constantly have a calendar of monitoring. So there’s a very specific process of monitoring those limitations, how that CEO is complying with the limitations, and how they’re complying with the accomplishment of the mission or the end. And so that’s done, I think the Ends probably are mostly done on a biannual basis, but the executive limitations as I said, on a calendar, they’re done every meeting.  We’re evaluating some aspects of that CEO’s performance.


[00:20:30] Tommy Thomas: So, under Policy Governance, do you use closed session or executive session a lot? Or is that not a part of the M.O.


[00:20:40] Carl LaBarbera: Yeah, no, not a lot at all. These are, there’s nothing that is considered, not transparent unless there’s something to do with, specific HR issues or something where it would be a problem legally, but otherwise now I believe in transparency. I believe this, everything we do at the board level should be transparent. I know as I chaired or on the executive committee at our church, everything we do there should be transparent to our membership. But it’s, we do have, I know at World Impact, there is a session at the end of the year where we look at all the policy governance elements that either were complied or not complied with, but then we also get a little more personal and try to talk about their spiritual life, their personal life how, the communication with the board.


So those are, those get to be touchy conversations, but necessary because that’s part of the board’s job is really to assure it’s one of three responsibilities the board can’t delegate. And that is to assure the success of the CEO and thus the organization.


[00:21:57] Tommy Thomas: On strategic planning, from your perspective, how deep should the board get into that, or is that something that the CEO and his or her cabinet brings to the board?


[00:22:08] Carl LaBarbera:  I’d like to think of strategic planning as a continuum of planning, right? When we do the ENDS work, the ENDS, again, are the high-level mission.


It’s what benefit, what people, at what worth. That is, that’s the highest level of the strategic planning process. The board can get more specific about that policy of ENDS or mission, but then they stop. The job of the board is to stop communicating at the point which they’re willing to allow any reasonable interpretation of that mission, right?


It’s hard work to determine that. So, trying to determine what it is that the board has to say to a CEO about the mission, but then allow freedom for him to have any reasonable interpretation or any strategic plan that can accomplish those ENDS.  That’s the delicate part of developing that particular set of policies. It takes a lot of wisdom, prayer, and determination. You don’t want to say too much because if the board is saying too much and prescribing too much, then that is not allowing our professional CEO to do their job well.




[00:23:30] Tommy Thomas: Let’s go to something that happened in mine and your era. People younger than us may not remember this, but certainly we do – the Enron scandal. And although they weren’t a nonprofit, I’m sure there are things a nonprofit board can learn from that. But one of the writers that did some analysis there, his perspective was that probably the board didn’t ask the tough questions that they needed to ask.  How do you get that done in a nonprofit?


[00:23:58] Carl LaBarbera: Absolutely. And the way we get it done is through the policy manual. In the manual itself, in those executive limitations, we’re asking the hard questions up front. There are limitations regarding financials. There are limitations regarding asset protection.


There are limitations regarding staff. There are limitations regarding the relationship with the CEO to the board and all these things, safety issues. So that is the role of the board, is to think through. And Carver was genius about this in a scientific way. He thought through a dozen different categories of risk that the board needs to think about ahead of time.


And of course, you’re not going to think about all risks that can happen, especially today. It’s so hard to figure out what’s going to come at you at a pretty hard and rapid pace, but for the most part, to think in general, in a systematic way, what are all the risks that an organization might encounter?


And to think about that in a systematic way and do it ahead of time and have those boundaries in place, which then provides the CEO freedom to do anything else. The beauty of policy governance is it lays out the boundaries of acceptability, like a football field and says, you have to stay within these parameters, within these limits, within the rules that we’ve outlined.


You could do anything else to achieve your end if they haven’t already been stated. So it’s empowering to the CEO. It gives freedom to the CEO. It gives them freedom to make mistakes. But does provide those boundaries, which is clear communication between the board and the CEO.


[00:25:45] Tommy Thomas: Go back to the Board Chair for a minute.  So you got but the two or three questions that I like to ask that, that I think the answers are good and one of them is, you get all the high power, which you want people that have got experience in making tough decisions dealing with complexity, dealing with risk But sometimes it’s difficult for the, for those people to take the CEO hat off when they walk into the boardroom and become a member of the whole.


Have you experienced that in recruiting board members and how have you effectively coached them into good board service?


[00:26:19] Carl LaBarbera: So, are you asking, I just want to be clear, you’re asking about those who have been or are CEOs that now become a part of the board, that kind of leader?


[00:26:29] Tommy Thomas: Yeah, they’re probably still the CEO in their organization and they’ve got an expertise that you need on the board.


[00:26:34] Carl LaBarbera: Yeah, exactly. Now that is a difficulty because, CEOs by nature are built to want to do strategy and make decisions and get things done. That is not the job of the board. And so, they really have to, and that’s one of those characteristics of a good board members, you need to really set aside maybe your own leadership gifts to allow yourself to be a part of this team who is now going to operate from a 30,000 foot perspective, not at the operational level.


Under Policy Governance, the Board’s role is governance – not management.  That is a critical element of governance.


Because that’s not where we work. We are governance is not management. That is a critical element of governance. It is not management. We shouldn’t be doing management work. We have professional CEOs that we’ve hired. We feel that the board members should be as professional as the CEO.


Why shouldn’t they be as trained and have as much expertise about their job that the CEO has about hs or her job and but to do that job and not someone else’s right that there’s another training element that high level leaders just need to be trained that this, you are not operating the organization.


We are governing the organization. And that’s a big difference. You’re taking your leadership.  Your directive often becomes a trustee, which is a different role.


[00:28:03] Tommy Thomas: You mentioned the CLA for people who might be members. There are people that might be Christian organizations. What about your standard, other kind of nonprofit? Where might they get this kind of training? Are there seminars or Policy Governance training that one could attend or sign up for?


[00:28:23] Carl LaBarbera: Absolutely. I belong to the Govern for Impact Association.  They have an annual conference, and they have sessions throughout the year as well. And it’s been a great place for me to really learn the process.


It’s a complex process and it should be.  They have classes, they have seminars, they have this conference once a year. There is training, future board members and chairmen, chair, chairwomen, chairpersons to do this work. And the interesting thing, this organization, started originally with the Carvers and those who are Carver-trained and but now has become this international organization, literally.


And actually has been participating in in Europe to develop ISO standards. I was in the aerospace industry, everything we did, especially for government and military work had to be done to international standards or Boeing standards or Lockheed’s or McDonnell Douglas standards.


So now Policy Governance has been embedded in an ISO standard for governance, what we’re hoping to see is that will trickle down and that will become expected of boards to adhere to a set of, international best standards. Policy Governance will be included, and will be a framework for that.


[00:29:49] Tommy Thomas: What advice are you giving somebody who comes to you and said they’ve been approached by an organization to serve on their board? What questions are you telling them to ask?


[00:30:00] Carl LaBarbera: Yeah, that’s a good question. Yeah, I guess I would warn them or ask them. They should know everything about that organization and how it operates that they can.


And one of those things would be to see if there is Policy Governance in place. Just obviously, if you want to read the bylaws, to read those governing documents that will affect their role because the worst thing that can happen is someone get on a board and have to spend so much time and tedium and making decisions that are management decisions.


When I first began serving with our church, there was an old process developed over many years where you had elders who each one represented an area of ministry in the church, and then they would come together as an elder board as a governing board. And then each 1 would be reporting out from their area of ministry which could be a dozen different ministries. And so, you have 20 people on a board and you are spending hours and hours listening and thinking about things that you really shouldn’t be thinking about. That is not your job. And so, I definitely would not want to be a part of that board. And I would advise others not to be a part of that board.


If the organization is not clear about that. The board’s role in their job. I wouldn’t advise being a part of that board.


[00:31:34] Tommy Thomas: Thank you for joining us today. If you are a first-time listener, I hope you will subscribe and become a regular. You can find links to all the episodes on our website:


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“One role of the Board is dealing with the risk factor.  Mitigating or at least evaluating risk to determine what’s acceptable and what’s not acceptable.” -Carl LaBarbera


Links and Resources

JobfitMatters Website

Next Gen Nonprofit Leadership with Tommy Thomas

The Perfect Search – What every board needs to know about hiring their next CEO

Christian Leadership Alliance

Govern for Impact

Robert K. Greenleaf Center for Servant Leadership

Ruth Haley Barton

World Impact


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