The most common mistakes include:
- Finance Committee is too small and lacks key expertise.
- The full board abdicates too much authority/responsibility to the Finance Committee.
- Finance Committee does not take an active role in educating the full board about the organization’s short- and long-term financial health.
- Senior staff does not have the expertise and experience to guide/support the Finance Committee.
- During the founding and start-up period, the Finance Committee is called upon to compensate for the lack of financial expertise on the staff (i.e., no qualified CFO). They delve too far into management, and over time, have a hard time extricating themselves from this role.
- The CEO lacks financial skills and has a hard time hiring and supervising a CFO with strong expertise.
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