If Boards don’t raise money for charities, who will?

Jack Siegel at Charity Governance takes umbrage at the Nonprofiteer’s endorsement of a fundraising requirement for Board members, claiming it interferes with their ability to govern the agency.  But governance is nothing more than making sure that the agency is fulfilling its mission–and no agency without sufficient resources can possibly do that.  A Board member who doesn’t give and get money is abdicating his/her responsibility for the agency’s well-being to (at best) other Board members and the Executive Director and (at worst) the government, corporate giving departments and foundations–because those are the people who are making sure its bills are getting paid so it can function.

Charity Governance further claims that a give-or-get requirement produces enormous, and therefore irresponsible, Boards.  This is false: many large agencies have both large Boards and fundraising requirements, but these are not causally connected.  Small agencies can and do have relatively small Boards but the members of those Boards nonetheless have to figure out how the agency should secure the funds it needs, and that includes giving and getting money themselves. 

(The size of Fortune 500 Boards, which Siegel mentions, is completely irrelevant in this context: the role of a for-profit Board is quite different from that of a charity Board.  For-profit corporations have sales revenue with which to power their growth, as charities mostly do not and should not–unless the proposal is that nonprofits stop being "dependent" on generosity and start charging their clients enough to support themselves.  In that case, we’re arguing about something way beyond "governance.")

Siegel then claims that a give-or-get requirement will interfere with the diversity of Boards, particularly the representation of low-income people.  But every study of the subject reports that low-income people are in fact more, rather than less, generous to charity than their wealthier counterparts.  So the argument that a Board member donation requirement will exclude low-income people is simply false.  If the minimum were in the thousands, we might have a different conversation; but the Nonprofiteer specifically recommended $500, an amount within the gift or raising capacity of most people.

(Agencies are welcome to put clients on the Board, and to exempt them
from fundraising if they choose–but most of the agencies with which
the Nonprofiteer has worked have client representatives who participate
in fundraising.  Only rich people pretend that money doesn’t matter;
poor people know better.)

Charity Governance suggests that governing Boards give pride of place to experts.  But the Nonprofiteer has worked with too many charity Boards where "expertise" was employed to second-guess the Executive Director instead of to support her in accomplishing the agency’s mission.  The most meaningful–not the only, but the most meaningful–form of support is financial.  You can’t pay your rent with a Board member’s expertise or time; you can’t pay your staff members with those commodities, however otherwise valuable and virtuous they may be.   And without these, your agency can’t do its job.  To argue otherwise is like claiming that "a thousand points of light" can replace Federal programs providing food and education: it’s wishful thinking masquerading as an operational plan.

Finally, Siegel argues that requiring Board members to give and raise money is the equivalent of legislating a ceiling on Executive Director salaries or fundraising expenses.  But actually, it’s quite the opposite: it’s the exemption of Board members from their financial responsibilities that puts an irrelevant external limit on salaries and other appropriate forms of expenditure.   

For some reason, Siegel expects that Board members who care enough about charities to make financial sacrifices for them–and encourage their friends to do the same–will be unable to read a balance sheet or evaluate the success of a program or determine whether the Executive Director is doing his/her job.  It’s not clear to the Nonprofiteer why competence in one area should dictate incompetence in these other areas; quite the contrary.  It’s the people who refuse to admit that charities need money, and that securing it is their responsibility, who are most likely to fall down in other areas of governance.

Charities are real institutions with real tasks to accomplish that
require real financial support.  Any member of the Board of Directors who doesn’t
participate in providing that support–and by "support" the Nonprofiteer means something flat and green–isn’t doing his/her job. 

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2 Responses to “If Boards don’t raise money for charities, who will?”

  1. Tom Durso Says:

    As I reported recently, foundations are very aware of which boards are more giving, and they tailor their own grant decisions accordingly. I’m with you, Nonprofiteer.

  2. Nonprofiteer Says:

    Though I’m often a critic of foundations, this is an arena in which their influence is both huge and positive. When foundations insist on being part of a group of givers–including all Board members, or as close to all as is feasible–they’re performing a great service. Thanks for reminding us of that.

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