Assessing The Commitment Of Nonprofit Leadership

You don't need to be an expert in the nonprofit metrics from Charity Navigator or another source to understand a nonprofit's performance. A significant indicator of whether a charity is worthy of your philanthropic investment is the commitment of its leadership.

Some of the questions to ask as a measure of a board's commitment, consider the following:

Do all members of the board of directors or trustees meet on a regular and consistent basis appropriate to the scope, level and nature of work required to successfully direct an organization of its size?

When meeting as a board, do members focus their attention and discussions on those matters requiring policy-level attention? Or do they spend their time discussing matters more appropriate for staff attention?

Does each member have a clear understanding of the specific reason they were asked to serve on the board and what their unique role on it is? Is that understanding reflected in each board member's assignment to and participation in committee work?

And - most telling - has each board member made an annual financial contribution to the organization at a level reflective of the priority that organization's work holds in their life.

This issue of determining whether every board member contributes financially to the organization should be critical to your own donation decision. Would you make a major investment in a company or venture in which the owners and founders had no stake? You would at least think twice before putting money into the firm, and you would probably maintain some level of oversight or control over that investment once it was made.

Yet every day, philanthropists and major donors make significant contributions to charities without verifying the participation of board members - essentially the owners of the organization.

There's good reason why many corporations and foundations demand to know what percentage of directors on a given board contribute to a charity before making a grant. Board members managing their own contributions in addition to those of the public will often be more deliberate in their financial and planning decisions. The internal standards for accountability are often higher when board members' own money is at stake.

Donors are often surprised — if they even ask — to find out how few directors contribute at all. The size of the contribution is almost irrelevant. For some trustees a donation of $10 might constitute a personal sacrifice, while for others a gift of $10,000 isn't a problem. A financial contribution is a tangible sign of a director's faith in the organization, its mission, its leadership and its direction.

Before making your philanthropic investment, inquire about the board's donation track record. Then decide if you would trust them to manage your money.

Adapted from an article for Community Foundations of America, Copyright 2002.

Carla E. Dearing

Posted at 1:01 AM, Oct 13, 2008 in Accountability | High Net Worth Donors | Nonprofit Management | Performance Measurement | Philanthropic Strategy | Permalink | Comment