September 4, 2008

Sacred Cow: Do Boards Really Have To Fundraise?

By Nancy Withbroe, CFRE and Joel Zimmerman, Ph.D.
Many nonprofits today view fundraising as a major responsibility for board members. Every board member is expected not only to make their own monetary donation, but also to successfully solicit significant donations from their personal or professional contacts.

Some nonprofits are taking this idea too far.

And, it might not simply be a misdirected emphasis on one board function versus another. In some organizations this practice has become a convenient way both to keep troublesome board members from meddling where the executive director does not want them, and for nonprofit managers to avoid accountability for their own shortcomings.

What should board members be doing? Before everyone gets steamed up, everyone can probably agree on two generalizations about virtually all nonprofits and their boards. First, all board members should donate money to their nonprofit, at a level that is a stretch for them, to demonstrate their own commitment to its mission. Many foundations and major donors expect to see personal donations from every board member, as a precondition to adding their donations to the organization’s funds.

Second, every board member should be willing to assist the executive director, development officer, or any other staff person in approaching potential donors about monetary support. Every board member should be willing, and fully able, to describe their nonprofit’s mission, explain the case for additional funding, and unashamedly participate in the organization’s request for support.

The practice that can be troublesome is requiring every board member to act in the capacity of a fundraiser and making this the (or a) primary responsibility for the members.

Let’s review the basics on the most important functions for board members. (Go check your reference books if you don’t agree with these.) The most important activity for a board is to set organizational strategies and policies. Second most important, boards must provide governance and broad organizational oversight. Down the list a bit, boards are often said to be responsible for ensuring sufficient organizational resources (including funding), although even this responsibility does not necessarily require directors to be fundraisers.

Most board members have limited volunteer hours they can contribute. The time they spend acting as fundraisers is time they do not spend in strategic planning and thinking, policy-making, organizational governance and oversight. These latter functions truly require board activity and cannot succeed without board participation.

Fundraising, on the other hand, can be greatly assisted by socially skilled and well-connected board members. But directly raising money should not be a fundamental requirement for board members, nor one of their top priority activities.

There is a possible dark side to this, a downside of board fundraising
In nonprofits where board members are assigned to do fundraising as a major responsibility, it is easy for executive directors and development directors to use the board shortfalls as excuses for their own inadequacies as fundraisers. “The board doesn’t do a good job of fundraising. That’s why our fundraising revenues are down.”

Then, when the board evaluates the executive director’s performance, a revenue shortfall can become the board’s fault, not the fault of the executive director.

Furthermore, it could be argued that if a board is doing oversight of the organization’s fundraising, then its own involvement in fundraising would at least blur its objectivity, and at most could constitute a conflict of interest.

Aren’t the public’s interests better served by having the board oversee the fundraising done by the nonprofit’s staff, rather than themselves bearing primary responsibility for fundraising?

When boards are actively involved in setting policy and strategy, and conscientiously performing oversight and governance, they often are not warmly beloved by nonprofit staff. Board members perceived as micro-managing operations frequently annoy executive directors. A convenient way to prevent the board from meddling in operations and disengage them from their pesky oversight is to distract them with fundraising tasks.

Rather than spending board meeting time talking appropriately about policy and governance, or even inappropriately about operations, an executive director can run out a lot of the meeting clock by encouraging board members to feel guilty about their nonperformance in fundraising.

Organizations with strong requirements for board fundraising suffer in yet another way. This probably makes it impossible to acquire and retain, and effectively discriminates against, board members who have fewer resources and affluent contacts. The result is over-representation on boards of older, wealthier, more-conservative individuals -- frequently straight, white men.

The lack of youthful, less-established, more diverse board members might penalize the nonprofit in terms of visionary thought, out-of-the-box problem solving, knowledgeable counsel, youthful energy and contemporary ideas.

The most critical requirement for board members is to engage with the organization’s mission. Every board member must honor a nonprofit’s purpose, share its values, recognize its vision for the future, and promote its programs.

This fundamental empathy with and passion for the mission is required for board members to satisfactorily carry out their core functions: strategic guidance, governance and oversight. In addition, these same characteristics make board members -- or anyone else for that matter -- powerfully effective fundraisers. The best fundraisers are people who know and love nonprofit missions, colorfully describe programs, and tell inspirational stories about the people whose lives have been changed.

If you have recruited, oriented and educated the board correctly, the members will become fundraisers. Their enthusiasm for mission and their personal dedication to the work will sell itself to the people with whom they associate. Nonetheless, the reason they need to engage with mission is to do the work of a board --- not to stand in for other people who must be dedicated to fundraising.

Of course, for top-end fundraising activities, such as capital campaigns, board members are irreplaceable in the fundraising process. Here, some board members -- involved, informed and highly articulate -- play special roles in support of fundraising. Here, our nonprofits depend on people who are socially well connected and comfortable rubbing elbows with donors capable of making major gifts.

Here, you need people who remain composed and unruffled in casual conversations about seven-figure gifts. Here, you need board members. But here is not a place that all board members necessarily need to go.

Some organizations have recognized that many people who could effectively help them with policy and program are not the same people who are well-connected for fundraising. In such cases, nonprofits have established two boards, at times referred to as a board of directors and a board of advisors.

The board of directors is asked to do fundraising, while the board of advisors, chosen on the basis of substantive expertise rather than social position, assists the organization in programmatic and substantive ways. From a governance point of view, though, the fundraising group is usually still the “official” board.

This invites other questions. First, why is the group with substantive expertise not the “directing” group? Why does the group chosen on the basis of social connections have official dominion over strategy, policy, governance and oversight, rather than the more knowledgeable advisory group, which is directly involved with programmatic decisions?

True, the fundraising board of directors has a more objective vantage point from which to exercise oversight (though the members might have less skill or desire to do so). They might argue that as stewards of the money they have raised, they should direct how the money is spent. But, the expertise-based board of advisors is probably more qualified to develop policy, execute strategy and promote governance.

Boards would work best if the responsibility for fundraising were left to executive and development directors or fundraising committees, and boards of directors concentrated their time on strategy, policy, governance and oversight. Well-connected fundraising friends could be courted and dearly welcomed as very special volunteers, and recognized with special titles as patrons. A few board members could serve as liaisons between the fundraising committee and the rest of the board.

But it’s time to rethink the sacred cow of burdening the entire board of directors with a primary responsibility for fundraising.

***
Nancy Withbroe is a consultant with CDR Fundraising Group in Bowie, Md., who specializes in fundraising planning, major gifts, capital campaigns and foundation relations. Her email is nwithbroe@cdrfg.com. Joel Zimmerman is director of consulting services for CDR Fundraising Group. He provides management and marketing consulting services. His email is jzimmerman@cdrfg.com.

***

This article is from NPT Instant Fundraising, a publication of The NonProfit Times.

Subscribe to The NPT Instant Fundraising eNewsletter or any of our other enewsletters and get the latest news and ideas related to fundraising delivered to your inbox.