WittyBizGal Nonprofit Management; How Much Should Your Nonprofit Rely On Required Board Member Monetary Donations?

Standard

WHAT ARE OTHER NONPROFITS’ POLICIES ON REQUIRED BOARD MEMBER DONATIONS? (Based on a 2007 Board Source survey)

Image & Data Sourced From: Should Board Members Be Required To Give? by Jan Masaoka 

I’ve been thinking about this issue for awhile now, gathering information, organizing my own thoughts on the subject, and would now like to address this arguably sticky wicket. Why is it sticky? I have come to the conclusion that it is one of the most uncomfortable management and governance problems the board will face, all because we’re human. Yep, we are impressive, professional, governing bodies comprised of flawed human beings–and discussion of personal financial matters makes most of us so uncomfortable that we don’t…discuss them, that is. This often leads to confusion, embarrassment, and less than effective governance and management, as poor organizational communication always does. 

It may not be common knowledge, but most nonprofit professionals are aware that it is traditional in the nonprofit sector for members of the organization’s Board of Directors to donate substantively to the nonprofit. This is because donations on the part of board members represent a gesture of good faith to the organization, as well as personal belief in, and commitment to, the entity’s vision and mission, as well as a tangible partial fulfillment of board members’ responsibility to fundraise. Financial donations in particular, according to some sources, render board members better able to approach donors to ask for major gifts and other types of charitable donations, although I disagree with this stance. Why do I disagree? Because I believe that substantive, meaningful donations on the part of individual board members do not necessarily need to be financial. There are a variety of ways in which board members can donate to the nonprofit in order to fulfill that generally accepted requirement to donate substantively as an individual–the traditional fiscal contribution of course, but also donations of the in kind variety, meaning special professional expertise, actual volunteer man hours, goods and services donations, etc. 

And here is where I will buck the system and attempt to radically overthrow the nonprofit sector as we know it and state without hesitation that I do not believe the traditionally accepted custom of requiring annual financial contributions of board members is a good one. Not only do I think this is an outdated notion which has been carried forth in the sector simply because it is tradition, but I also think it can be unhealthy and harmful to the organization in certain circumstances. While I completely agree that board members need to display commitment to and belief in the organization via donation, as I’ve stated, those donations can and should come in a variety of forms in addition to financial. In fact, nonprofits adhering to the tradition of large, required monetary donations to the nonprofit run the serious risk of maintaining a homogenous board, with only members of one particular socioeconomic background, which can lead to harmful groupthink, or even unnecessary discrimination against worthy potential members of lesser personal means. 

Board members of nonprofit organizations can and should be so much more than large gift donors. Great, effective board members….

  • Display exceptional leadership skills
  • Demonstrate ability to keep simultaneous focus on both long term and short term organizational goals
  • Bring diverse professional skill sets to the table
  • Have the inclination and ability to volunteer hours of their time to make a difference
  • Offer varied perspectives in order to foster effective teamwork and problem solving
  • Skillfully and strategically plan organizational activities from year to year which effectively support the organization’s mission, vision, and purpose in the community

Nonprofit organizations, quite frankly, are lucky if they can find these qualities in board members willing to donate their time and expertise to the organization…and these qualities don’t always co-exist with a fat personal bank account. Board members from all walks of life, cultural backgrounds, and socioeconomic status should be sourced by organizational leaders in order to assemble the best team–a team with diversity of perspective, and a desire to do something wonderful and meaningful with their lives. Overreliance upon the Board of Directors for fundraising from their own wallets, and overemphasis upon members’ ability to donate financially, can cheat nonprofit entities, and more importantly the clients we serve, out of an optimally functioning board. Not to mention the fact that honing an ability to gather such donations from the community, corporations, and other sources is equally, if not more important than simply reaching for one’s own checkbook to finance organizational activities, programs, and services. 

For additional reading on the topic of board member contributions of all varieties, I recommend BoardSource  for trustworthy, up to date governance articles and resources. 

What is your take on mandatory, or strongly expected and heavily emphasized board member monetary donations? Do you hold with the traditional school of thought that this is a large part of what makes a board member worthy and desirable as part of the team, or do you agree with me that we need to start a bit of a revolution in our sector? Weigh in below! 

3 responses »

  1. Though questioning traditions makes for stronger organizations, your position takes the board directors off the hook. Making “pay to play” a requirement for board service limits the type of candidates, agreed. Board responsibilities require selection of qualified leaders fitting the strategic needs of the organization, but some words about facilitating fundraising relationships should be written into board director job descriptions. Too many directors focus on internal efforts and very few go forth making the ‘Ask’.

    Granted, many should NOT make the ask personally. Facilitating introductions to the right connections help immensely.

  2. Thanks very much for reading, and especially for joining the dialogue! I do have a question though–“off the hook” for what exactly? IF board members could be sourced, trained and groomed to facilitate fundraising AND “making the ask”, then what would we be letting them off the hook of? I tend to believe that simply because qualified board members were not born into money, did not marry money, are not necessarily “prominent” members of the community with access to money, does not mean that they cannot do the nonprofit a LOT of good! Thoughts?

  3. Pingback: WittyBizGal Nonprofit Management; 3 Common But Fatal Governance Mistakes « wittybizgal

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s