A Higher Calling
Ethical Issues and Lutheran High School Board Service
Seldom does a day go by without a major new story describing the fall from trust
of people in leadership. In the corporate world, names like Enron, WorldCom
and Arthur Anderson have become synonymous with corruption and scandal.
Leaders in these organizations are criticized, and sometimes even prosecuted,
for their failure to live up to standards of behavior expected by the American
public.
Unfortunately, disappointing values and unethical practices are also evident in
public institutions and in the not-for-profit world. Government officials are
regularly accused of illicit activities. Not-for-profit organizations, some as well
known as the American Red Cross, are criticized for their decisions regarding the
use of donated resources. Church officials are accused of criminal behavior,
such as sexual abuse and fraud.
The governing boards of our institutions are also in the news. Valid questions
abound regarding the competence of board by individual board members and
conflicts of interests that effect their decisions. Boards are also criticized for their
lack of awareness of unethical and sometimes, illegal activities taking place in
their organization and for their failure to provide adequate oversight of their staff’s
actions. The public is increasingly aware that the consequences of such failures
can be widespread and devastating to individual investors, to important
charitable causes, and to the morale and well being of society in general.
But not in a Lutheran high school!
Most of us express great concern and disappointment about the values and
ethical standards in so many of our institutions, and rightfully so. We wonder
what these situations mean for the future of our country. We worry about the role
models to which our children are exposed.
Are Lutheran high schools immune to the situations that cause these concerns?
Does the mission and environment in a Lutheran school isolate leaders from
ethical dilemmas? Consider these snapshots from life in a Lutheran high school:
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The school board is voting on a significant tuition increase
that would increase tuition by several hundred dollars. If
adopted, this would have a significant financial impact on Mr.
Jones, a school board member with two children in the
school.
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Mrs. Kelly, also on the school board, is a sales person for a
paper and small office equipment supplier in the community.
Having the school’s business would be very valuable to her.

Ms. Schmidt, a math teacher at the school, is the faculty
representative to the school board. She is regularly privy to
information about school families and about her colleagues
as the board discusses various issues.
These situations may not be newspaper worthy, but they require similar
important ethical choices. Lutheran school leaders are not immune to these
decisions.
What is unique about board service in a Lutheran high school is the context in
which such choices can be made. Some educators describe their schools as
“laboratories of Christian living.” This is a great description for the boardroom as
well as the classroom! Lutheran school leaders are blessed to make choices not
based on fear of exposure, but rather on the knowledge that their choices are
joyful responses to the love and forgiveness they experience through Christ. As
they live, learn, and are forgiven, board members serve as models to others in
the school family and larger community, governing with integrity, honesty, and
high ethical standards.
This monograph intends to help Lutheran high school board members and other
leaders explore the ethical challenges they face. It provides suggestions for
creating an atmosphere that encourages and supports high standards of
behavior. This resource does not attempt to provide legal advice. Rather, it
highlights daily opportunities school board members have been given to
celebrate and witness their faith by serving as effective role models and stewards
of the many resources God provides through the Lutheran high school.
For further discussion
 If you were prioritizing a list of personal qualifications for school board
membership, where on the list would you place the quality of high
personal integrity and ethical standards?
 When was the last time your board discussed the topic of board member
ethics?
A Matter of Trust
An appropriate place to begin an exploration of board member ethics is with the
important relationship between the board and the school’s owners. This
relationship is often described as a ‘trust.’ Board members are elected or
appointed by the owners and the good of the institution is entrusted to them.
They are chartered to oversee, or govern, in order to keep the vision of the
institution alive and to ensure the long-term effectiveness of its mission.
The National Association of Independent Schools refers to board members of its
member schools as “trustees.” (Independent School Management, 1992, p.7)
Robert Greenleaf describes the trustee role in this way: “Trustees are
accountable to all parties at interest for the best performance of the institution in
the service of the needs of all constituencies and society at large. They are the
holders of the charter of public trust for the institution.” (1991, p. 6)
As Greenleaf indicates, a governing board’s accountability extends beyond
responsibility to its owners to the wider community. For an organization to
operate with the public’s consent and with its support, someone must be
understood to be acting with the public’s interest firmly in mind. (Robinson, 2001,
p.8) People who utilize the services or products of a Lutheran school, or any
other not-for-profit institution, and those who support it financially expect
oversight by an objective, informed and highly ethical group of people. Robinson
contends that “Behind that trust is the perfectly reasonable assumption that
someone somewhere is keeping track of things, is assuring themselves, and by
extension, the rest of us, that things are in order. This reassurance is truly
reassuring only when it comes from a person who appears to have nothing to
gain from offering it.” (2001, p.9) Broholm and Johnson concur: “The degree to
which board and staff can build trust will influence the organization’s ability to
build trust with its publics.” (1993, p. 49).
Another way to highlight the importance of the trust relationship is to consider the
value a board brings to the organization it governs. It is the place where
responsibility for maintaining accountability and safeguarding trust resides. It
provides “transparency,” keeping the operation of the organization and the
actions of its leaders in the public view. It provides the capacity to bring diversity
and balance to the organization’s leadership. It is a source of advocacy for the
mission of the organization. And, it has the power to gather resources needed by
the organization. (Robinson, 2001, pp. 7-12) The values and ethical framework
of board members impacts the board’s ability to meet each of these expectations.
The concept of holding the good of the institution “in trust” applies to the core
values and ideals of the institution. “…Trustees hold in trust something much
deeper and elusive – the legacy of the institution. Legacy includes the dreams of
the institution’s founders and its history of accomplishments and failures. It
includes deeply-held values and beliefs which have shaped its character over the
years.” (Broholm &Johnson, 1993, pp. 40-41). Referring to the trustee role of
today’s school boards, Independent School Management states that the job of
the school board member is to make decisions in such a way that “your current
students’ children will be able to come to the your school and to experience your
school’s mission 20-30 years from today.” (Independent School Management,
1992, p.7)
Stated simply, a governing board is a group of people representative of the
institution’s owners. These owners place the good of the institution “in trust” to
those who serve as board members. When board members earn the trust of
owners and other stakeholders, the value of the organization is enhanced. The
degree to which board and staff can build trust will influence the organization’s
ability to build trust with its publics. (Broholm and Johnson, 1993, p. 49)
Being entrusted with the welfare of an institution can be a daunting task to a
Lutheran high school board and to the individuals who are members of the board!
From a Christian perspective, however, this challenge also provides a great
opportunity to respond to the good news of Jesus Christ! In the title of an article
included in the book Building Effective Boards for Religious Organizations,
Malcolm Warford refers to trustees as “stewards of hope.” (Warford, 2000, p. 3)
Warford reminds members of church boards that they are managing resources
belonging to God and they have been entrusted to faithfully articulate and
ardently pursue the vision of the congregation or institution. This noble title,
“steward of hope,” certainly assumes the highest degree of personal
responsibility and integrity from those serving on church boards.
For Further Discussion
 Who would you identify as the owners of your Lutheran high school?
 Can you give an example of an individual who you believe has an
ownership interest in your school, even though he or she is not a member
of the congregation(s) or other entity that owns the school?
Board Service as Vocation
Lutheran church members are familiar with references to the “divine call.” It is
used regularly to recognize God’s act of matching the special gifts of individuals
to specific ministry roles in the church. For Lutherans, the calling process also
affirms the relationship and mutual accountability of the individual called to
service with a ‘calling body,’ usually a congregation, school, or church body.
Most often, one thinks of pastors and certain teachers in Lutheran congregations
and schools as “called” workers.
However, God calls all His people to serve. As members of the body of Christ,
we are each set aside for service and called to use our unique gifts to accomplish
the work God intends for us. This includes volunteer service, such as that
carried out by Lutheran school board members. Our service is more than just a
volunteer activity; it is a vocation.
The Christian board member’s understanding of board service as vocation
provides a great framework for serving with a high degree of integrity. A sense of
vocation heightens a board member’s awareness of the importance of the
board’s work and establishes a high standard of personal accountability.
For Further Discussion
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What is your reaction to the term “trustee” as descriptive of your work as
a Lutheran school board member?
In what ways is the concept of vocation helpful as you consider your
responsibilities as a board member?
With what special gifts and abilities has God equipped you for board
service?
Ethical Dilemmas
The concepts of trusteeship and vocation provide a helpful foundation for
addressing the ethical challenges facing Lutheran high school board members.
The privilege of such service carries with it high expectations from a variety of
stakeholders who have various agendas as owners, employees, donors,
vendors, parents, or students. In the midst of these expectations, the board
member is called to be a faithful steward of the school’s mission. Those who
serve on the board of any organization know how difficult this can be.
A variety of situations and circumstances can cause ethical dilemmas for
Lutheran high school board members:

Conflicts of Interest
Many of the challenges board members face result from being placed in a
position where one must make a choice among conflicting interests. Such
situations are not uncommon in Lutheran high schools. They can include:
o Representing Special Interest Groups
You are the chair of the Athletic boosters. At your school, this position
entitles you to a seat on the school board. The boosters want the school
to institute a football program. Doing so would divert funds from a library
expansion project recommended during the school’s last accreditation
visit. Whose interests receive the highest priority as you serve on the
board?
It is not unusual for a Lutheran school board to include representatives
from various groups, such as the parent-teacher league, the faculty, or the
athletic boosters, as a member of the board. The ethical dilemma facing
the board member who also represents a particular interest group is
obvious. Is this person’s primary allegiance to the school’s mission and
the best interests of the entire school community or to the priorities of the
organization whose “reserved seat” on the board she fills?
o Parental Interests
The school board is considering a special academic program. The
program will be very expensive to implement and will benefit a small
percentage of the students in the school. Your child is one of these
students. As a board member, do you support this new program?
Every parent wants the absolute best learning opportunities for his child.
Participating as a board member to help the school achieve its mission is
a great way to achieve this goal. However, if a parent’s primary motive for
service is the best interest of his child, rather than the good of the entire
school ministry and all who are served by it, effective board service is
impossible.
o Business Interests
You have recently been asked to be a candidate for the high school board.
You are aware the school is in the early stages of considering a significant
building project. You own a construction company that will likely submit a
bid for this project. Should you let your name stand for board
membership?
Lutheran schools often benefit from the generous contributions of people
who believe in the mission of the school. These contributions can include
discounted prices for goods or services purchased from a local business.
However, a board member who is in a position to provide these goods or
service must be extremely careful to avoid a conflict of interest, or even
the perception of such a conflict. Typically, this is done by making the
board aware of the conflict and excusing oneself from the decision-making
process.
Michael Mosher, a Chicago attorney specializing in legal issues effecting
not-for-profit organizations, contends that a director or officer who may
receive a tangible personal benefit as a result of a decision affecting the
corporation’s business or assets has a conflict of interest. Mosher also
states that today’s directors and officers of nonprofit organizations are
generally held to the same legal standards of conduct applied to the
directors and officers of business corporations. This also means that
other board members who are aware of and allow such situations to exist
can also be held accountable by law. (Mosher, 2002, p. 5, 6)
o Personal Interests
As a violinist, you would love to see the school begin an orchestra
program. Is it correct to use your position on the school board to advocate
for this program?
Many board members have hobbies and special interests. Promoting
such interests for possible inclusion in the schools curricular or extracurricular programs is not necessarily a bad thing. However, caution is
always in order. A board member who is a chef “by day,” may think it
would be great to have a cooking lab in the school. He may even know a
donor who would pay for the cooking lab. However, it would be unethical
for this board member to place undue pressure on the board to implement
this program if it is clear that it is not consistent with the mission and
direction of the school or crucial to achieving the school’s outcomes.

Confidentiality
A key premise of board governance is that a board is a group of individuals who
operate as a single entity and speak with one voice. Since not all members of
the school community are aware of and understand the importance of this basic
principal, operating according to it requires board members to exercise both good
judgment and self-control. While policies adopted by the board are public
information, the content of discussions leading up to these decisions are not.
Board members need the freedom to discuss issues openly and, in the course of
discussion, even change their opinions. The contents of such discussions can
easily be taken out of context outside of the boardroom. Unfair conclusions
about the beliefs and opinions of individual board members can easily be
reached. It is unethical for board members to disclose such information.
Similarly, board members are often privy to information related to internal
operations and to personal information about fellow board members,
administrators, faculty or staff members. Acceptable standards of ethical
behavior also require that this information be kept confidential.

Special Privileges
Recently, the headline article on the front page of a Chicago newspaper
questioned the high cost of special ‘perks,’ such as private charter jet
transportation to special conferences, that are available to members of the board
of regents of various public universities in Illinois. Lutheran high school board
members are not likely to have access to jets, expensive meals, or high priced
hotels related to their board service. However, the article is a good reminder that
the public’s trust is affected by public perceptions of personal gain available to
persons serving on governing boards.
Perhaps more likely in Lutheran high schools are questions related to special
treatment for children of board members or access by board members to
information unrelated to the board’s work. It is important to remember that
outside the boardroom, a board member has no special authority. Board
members are subject to the same rights, privileges, and opportunities as other
school volunteers or parents. It is highly unethical to expect or demand special
treatment or to exert influence based on board membership. To uphold the trust
of the school community, every effort should be made to avoid the perception of
things.

Failure to Exercise Due Diligence
A basic fiduciary responsibility of a board member is exercising care in fulfilling
the duties of board membership. Those who elect or appoint board members
expect them to understand the charter and responsibilities of the board, to attend
meetings regularly, to prepare thoroughly for each meeting, and to use
discernment in the decision making process. Especially important for today’s
boards is financial oversight, including the development of appropriate policies to
ensure regular audits and to guide the school administrator’s activities relative to
financial practices.
Why is the exercise of due diligence as a school board member an ethical issue?
When one willingly accepts the responsibilities of board service one is making a
commitment to carry out these responsibilities to the very best of one’s ability.
Failure to meet the test of due diligence constitutes a breach of trust with the
school’s owners and supporters, who expect board members to do everything
possible to preserve and extend the school’s mission.
For Further Discussion
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Which of the ethical dilemmas described above do you find to present the
biggest challenge to you as a board member?
Recall a recent situation that created an ethical dilemma for you as a
board member. How did you resolve this situation?
How does your board help build awareness by its members of situations
that can cause ethical difficulties?
Keeping the Standard High
Lutheran school boards are stewards of the resources God provides. For a
board to be a good steward requires personal diligence and mutual support from
every board member. It also requires continuing effort by the board to establish
and maintain policies and procedures that help individual board members carry
out their responsibilities ethically. Helpful things a board can do include:

Governing through policy
A fundamental principal of board governance is that a board speaks with one
voice. Individual board members have no individual authority. The device
through which a board speaks is written policy. Boards keep minutes of their
meetings, but it is only through policy that the values and perspectives of the
board are formally communicated. A board’s diligence in making it clear that it
speaks primarily through written policy helps prevent situations in which
individual board members are asked by constituents to interpret the board’s will
and situations in which board members are tempted to exercise authority as
individuals.

Board Self-Governance
Self-governance is one of four categories of governing board policies developed
by John Carver in his Policy-Based Governance model (Carver, 1990, pp. 3439). Regardless of whether a board adopts the entire policy-based model,
developing self-governance policies can be helpful.
Self-governance policies are established to guide a board’s own behavior. They
typically include policies that reflect the board’s expectations of its members in
areas such as meeting preparation, attendance, decorum, and board member
activity outside the boardroom. In addition, self-governance policies describe the
ways the board intends to conduct its business, including the election of officers,
the responsibilities of officers, procedures for placing items on the agenda, etc.
Self-governance policies also often include procedures to be followed when a
board member fails to meet the board’s expectations. Typically, many selfgovernance policies mirror information included in corporate by-laws.
Self-governance policies are an ideal way for a board to express its values and
perspectives regarding ethical standards. Speaking through policy allows a
board to have a clear record of behaviors and activities it considers acceptable.
Written policy also allows for regular review is a useful tool for board member
orientation.

Code of Ethics
Another helpful tool for encouraging high standards of ethical behavior is a
written code of ethics. This document does not need to be lengthy. It can
include, very simply, a list of expectations for board members addressing issues
such as those highlighted in this monograph, including conflicts of interest.
Boards who utilize self-governance policies can include many of the expectations
stated in these policies in the code of ethics.
One effective procedure for using a code of ethics is to require each board
member to sign the code annually. Doing so serves as a regular reminder of the
responsibilities of board service.

Legal Requirements
Earning and sustaining the trust of the school community as a board member
involves more than meeting legal requirements. However, as mentioned earlier
in this monograph, board members are required by law to meet certain fiduciary
responsibilities. Since these requirements vary by state, it is a good idea to ask
legal counsel to review all board policies and procedures and to meet with the
board regularly to help assure that the board and its members are in compliance.
In today’s litigious society, it is much wiser and more cost effective to minimize
the risk of such problems than to resolve them after the fact.

Systems Review
Is it true that every system is perfectly designed for the results it gets? If so, one
can make the case that those systems within which a board operates effect the
probability of ethical difficulties. Systems related to decision-making, lines of
authority, communication, financial control, board member selection, and others
should be reviewed regularly.
The process of board member selection merits a special word of caution.
Perhaps the most important thing a board can do to prevent ethical problems is
to recruit individuals with the skills needed by the board that possess high levels
of personal integrity. When a board does not select its own members, this
‘quality control’ can be very difficult. This difficulty can occur, for example, when
a Lutheran High School Association is structured in such as way that each
congregation selects its representatives to the board. School boards subject to
this type of selection process should do all in their power to provide as much
input to the process regarding the needs of the board and the screening of board
candidates as possible.
Similarly, the practice of reserving a board seat for a representative of internal
groups such as the faculty or the parent-teacher league can create similar
difficulties. Once again, the board often is not involved in selecting such
representatives. In addition, the person who is representing the other group is at
high risk for conflicts between the interests of the board and those of the
organization he or she is representing.

Continuing Education
A great way to maintain a focus on issues related to board member ethics is to
keep learning! Continuing education opportunities can include board retreats,
special workshops, reading assignments followed by discussions of articles and
books, and case studies. Reserving a few minutes on each board agenda for
board development is one way to ensure attention to this important process.
While time is always an issue, an investment in board development will ultimately
result in improved efficiency and effectiveness.

Providing Mutual Support and Encouragement
Lutheran school board members enjoy the great gift of God’s grace as they do
the important work of school governance. The call to school board service is a
call to join a community of Christian colleagues working together for a common
purpose. As in every Christian community, participants enjoy the gifts of
friendship, spiritual support, forgiveness, and celebration. Time at each board
meeting dedicated to prayer, Bible study, and personal sharing helps nurture the
faith of individuals and build a caring community. What an advantage this
community provides for people who desire to do their work at the highest level of
service, integrity, and ethics!
For Further Discussion
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
What policies, procedures, and activities does your board have in place to
help board members maintain a high standard of ethical excellence?
What other policies, procedures, or activities would be helpful to you live
out your call to service as a board member?
A Final Word
In her recent book Trust and Teams, Jane Fryar contends that the concept of
trustworthiness includes three corresponding dimensions: competence - the
ability of the trustee to live up to the trustor’s confidence, willingness - the
trustee’s desire to live up to the trustor’s confidence, and character - the moral
commitment by the trustee to live up to the trustor’s confidence regardless of the
difficulties that it may involve or the price that may have to be paid. (Fryar, p.
22).
These dimensions form a fine picture of the gifts those called to be stewards and
trustees bring to Lutheran schools. They also bring to mind the encouraging
words from I Peter 4:10: “God has given gifts to each of you from his great
variety of spiritual gifts. Manage them well so God’s generosity can flow through
you.” (New Living Translation). May God grant all who serve on Lutheran high
school boards the ability to use their unique gifts competently and to His glory,
the willingness to earn and sustain the trust of a community focused on the
mission of the Lutheran school, and the moral commitment to consistently act
with honor as Christian stewards!
References
Broholm, Richard and Johnson, Douglas (1993). A Balcony Perspective:
Clarifying the Trustee Role. Indianapolis, Indiana: The Robert Greenleaf Center
Carver, John (1990). Boards that Make a Difference. San Francisco, California:
Jossey Bass Publishers, Inc.
Greenleaf, Robert K. (1991). Trustees as Servants. Indianapolis, Indiana: The
Robert Greenleaf Center.
Fryar, Jane L. (2002). Trust and Teams. St. Louis, Missouri: Concordia
Publishing House.
Independent School Management (1992). How to Put Your Board Together In
Ways That Make Sense: The ISM Trustee Guidebook. Wilmington, Delaware:
Independent School Management.
Mosher, Michael P. (2002). Legal, Financial and Ethical Issues Every Board
Member Should Know. Presentation notes. Presentation to the Chicago
Chapter of the Christian Management Association, May 16, 2002.
Robinson, M. (2001). Nonprofit Boards that Work: The End of One-Size-Fits-All
Governance. New York, New York: John Wiley & Sons, Inc.
Warford, Malcolm L. (2000). “Stewards of Hope: The Work of Trustees.”
Building Effective Boards for Religious Organizations: A Handbook for Trustees,
Presidents, and Church Leaders, edited by Thomas Holland and David Hester.
San Francisco, California: Jossey Bass Publishers, Inc.
Biography
Richard Herman currently serves as Vice President and Chief Operating Officer
at Wheat Ridge Ministries. He formerly served the church as Executive Director
for Parish Services, Florida-Georgia District, L.C.M.S. and as a Lutheran school
teacher and principal at both the high school and elementary level. He is a past
president of the Lutheran Education Association. For the past fourteen years, he
has authored “On Board,” a resource for Lutheran school board members.