In today’s regulatory environment, boards of not-for-profit organizations are being held accountable for appropriately fulfilling their fiduciary duties. The primary fiduciary duty of oversight requires, among other things, that boards help management set and monitor the organization’s strategic direction. However, most of the governance effectiveness practices that have been published recently have not provided sufficient clarity regarding this crucial area of board responsibility.

Strategic direction-setting is an overarching respon-sibility that includes all longer-range thinking and decision making done on behalf of the organization. For most organizations, the principal representation of the strategic direction is the strategic plan—the document that articulates the organization’s mission, core values, longer-term vision, and shorter-term goals. Thus, it is the strategic plan and planning process that are the primary focus of this white paper.