When the Board Members Don’t Make Philanthropic Gifts
I'm working with a client on a feasibility study. To begin with, the client, through their mission and data confirming results, is one of the more outstanding nonprofits I've ever seen. To be candid, I'm kind of blown away. The feasibility study deals with capacity building, directly and indirectly, as they try to increase their impact on people in their community.
What's staggering is that many of the nonprofits board members do not make a philanthropic gift, and maybe even more concerning, don't consider it part of their responsibility. I've pushed and prodded trying to find a middle ground in the conversations about explaining why it's important. In doing so, it led to thoughts as to the true importance of philanthropic leadership coming from the board. Nonprofit boards where members do not make financial contributions can face several challenges:
• Lack of Financial Support: One of the primary roles of board members is to ensure the financial stability of the organization. When board members do not contribute financially, it can signal a lack of commitment to the organization's financial health, potentially leading to budget shortfalls.
• Fundraising Challenges: Board members are expected to leverage their networks for fundraising. If they aren't donating themselves, it might be harder for them to ask others to contribute, potentially reducing the organization's overall fundraising effectiveness.
• Credibility Issues: When board members contribute financially, it can serve as a powerful endorsement of the nonprofit's mission and management. Without this personal investment, it may be difficult to convince other donors and stakeholders of the organization's worthiness.
• Engagement and Commitment: A financial contribution is seen as a litmus test for engagement. A lack of personal financial commitment might correlate with lower overall engagement in other areas, such as strategic planning, advocacy, and attending meetings.
• Setting a Precedent: If board members do not donate, it may set a precedent for minimal financial commitment from the board, which could be difficult to change over time and might affect the organization's culture and values around giving.
In conversations with different funders, both individual and organizational, this issue has come up. Multiple funders, who must have some type of disclosure requirement regarding board giving, articulated very clearly that the organization for which I am working isn't a top priority because they're deeply bothered by the fact that board members either aren't required to give or choose not to give. Several have said that they won't give any gifts of any size until this changes.
None of the above addresses a dollar figure requirement. And I'm not sure I agree with having a requirement that's tied to a specific dollar amount. Some people can give more than others. Some people's philanthropy is through their time and their talent. But there can't be an excuse, if we truly are to have best practice, where board members have the option not to make a philanthropic gift to the charity in which they are fiduciary.
