What Makes a Director Outstanding Part 3 – How The Role Is DIFFERENT

All the knowledge and experience from the working world (“day job”) can actually hinder a volunteer’s effectiveness in the world of HOA governance if the differences between the two worlds are not understood. Outstanding directors have learned that much of what worked for them in their day job will likely work poorly in the context of board governance. The chain of command is completely different in a community association. In the workplace, there is usually a person who is the “big boss”, somebody who is your immediate supervisor, and someone who you supervise. In the association, no single person is in charge. Decisions are made by the board, so the chain of command is horizontal and not hierarchical. The president in a common interest development is not the “big boss.” The president has far less power in most nonprofit corporations since all important decisions are made by the board, and so the president’s vote is no more important than any other.

In this very different paradigm, the individual director typically has no personal power. Once directors embrace the framework of the board as decision-maker, they understand that they cannot make individual promises. This restraint can be very freeing since no individual is responsible for the association and its actions, as all decisions is made by board vote. So, when confronted at the pool or parking garage by homeowners demanding action, the director can truly say they can’t individually do anything and suggest the homeowner bring their concern to management or to a board meeting.

Directors failing to adapt to the group decision-making process will often stray outside of corporate authority and are also prone to unilateral actions without waiting for input from their board colleagues. Such directors often view themselves as “action-oriented,” but their actions without board authority can be precipitous, create exposure to liability, and engender conflict with the other directors. The “Lone Ranger” in the HOA context is in great personal danger, since such a crusader is outside the protections of the corporate process and the Business Judgment Rule.

A director’s role is in the title; A director directs. Directors are not normally required or expected to act. The board receives information and advice from many possible sources, and then responds to that information by directing the association manager, employees, and service providers to act.

The best directors experience less stress, understanding that they are not called upon to do the work but rather to decide who will do it. Such directors are less likely to micromanage the association’s professional manager, if it has one. Superior directors allow, and insist that, the manager and service providers perform. Outstanding directors do not perform the work of a failing manager or service provider; but instead they find a new one when things are not working out.

Healthy associations have a healthy and orderly rotation of leadership, so be prepared to let someone else take a turn. Volunteer HOA service should not be a life sentence. Begin identifying and preparing your replacement on the board. Committees are a great place to identify people who have the interest and demonstrated commitment to the association and proper attitudes of service and governance. Don’t simply assume it always has to be you!

Written by Kelly G. Richardson

Kelly G. Richardson Esq., CCAL, is a Fellow of the College of Community Association Lawyers and a Partner of Richardson | Ober | DeNichilo LLP, a California law firm known for community association advice. Submit questions to [email protected]. Past columns at www.hoahomefront.com. All rights reserved®.