ABSTRACT
Voluntary boards face a dilemma when making financial decisions that arise from the legal framework under which boards operate. The legal framework requires trustees to act together, taking collective responsibility for decisions, arguably at their most critical in relation to organisations’ financial resources. This presupposes board members have a shared understanding of, and implicitly, shared expertise in reaching those decisions. Yet, in practice, expertise is often unevenly distributed and some board members’ reliance on their more financially literate colleagues can imbalance this collective responsibility model. Dependency relations may thus develop on boards between financial specialist and non-specialist colleagues, as well as between boards and their paid staff. Paradoxically, in order to attract trustees, organisations may downplay the degree of financial understanding required by each trustee. Boards therefore face a continuing dilemma, as they are simultaneously encouraged to develop their financial expertise while valuing the contributions of nonspecialist board members.
