Nonprofit governance: Starting with the purpose in mind
In governing their nonprofits, boards should start by asking a simple question: “How do we define programmatic success?” With the answer in hand, boards will go a long way to help their nonprofits navigate the ever-changing environment.
When talking recently with the executive director of a Pittsburgh-based nonprofit, we asked what his ideal Board of Directors would look like. His answer? “A bunch of billionaires.”
This response, though likely in jest, goes far to illustrate a failure of nonprofit governance. Often more benefactors than leaders, we’ve seen that the path of least resistance for nonprofit boards is to spend time on themselves – rounding up new members, fundraising – rather than focusing on the critical issues of managing a dynamic organization in a changing environment. It’s one reason so many nonprofit institutions are often stuck in the vicious, self-perpetuating circle of funding crises and staff turnover.
The single most pressing consideration that any nonprofit board needs to address is defining what constitutes programmatic success. Just like any good start-up company begins with a business plan, nonprofits need to, first and foremost, understand their reason for existence.
The “bigger is better” concept, prevalent in our culture, results in a backward form of analysis. The objective of any nonprofit should be impact, not size. And to gauge impact, nonprofit Boards should start with programmatic objectives, which flow naturally from asking the question: “How do we define programmatic success?” The budget, the staff, the composition of the board – these all follow. Staff and board leadership should work together to answer this question.
Bigger boards, leading to bigger budgets – this doesn’t necessarily lead to bigger impact. If your nonprofit’s board raised twice as much, and you served twice as many Baltimoreans in need, does that mean you had twice the impact? Not necessarily. Does it mean the lives of your constituents are twice as good? Maybe yes, maybe no.
The example of Green Street Academy comes to mind. GSA is a public middle-high school in West Baltimore – the only school that is both sustainability-focused and delivers a school-wide project-based learning education.
When we co-founded the school with Lawrence Rivitz and Edward Cozzolino, the immediate programmatic objectives established at GSA were front and center:
- Create a culture of high expectations and academic outcomes in a previously failing school;
- Pioneer a learning paradigm called project-based learning; and,
- Build a durable, motivated team of teachers to carry out the task.
This laser-focused approach led to a unique board structure. Our main decision making body, the Board of Trustees of Green Street Academy, Inc., the school’s nonprofit operator, is made up of three founders and eight individuals – all under 40. The board members are ethnically and racially diverse, active in the field of sustainability, and passionate about the GSA mission.
The school board also makes use of online fundraising platforms such as GoFundMe to generate money for the causes it supports. Above all, while traditional or offline methods are still important, the rise of online fundraising platforms has opened up a whole new world of fundraising possibilities that cannot be ignored by educational establishments.
This choice spoke directly to our programmatic goals: To set a culture of high expectations, we needed successful board members in whom the students could see a reflection of themselves. And, to pioneer a new learning paradigm, we needed to a young board to motivate and communicate with staff – to share each other’s stresses and aspirations in ways that board members in their 50s simply cannot.
We’ve had much success with this model. Yet, most boards simply don’t talk about programmatic objectives with much vigor – and they certainly don’t set their own goals around them.
We envision a nonprofit sector where boards are actively engaged in not only the setting of programmatic objectives, but the measurement and evaluation of programmatic quality. We envision a nonprofit sector that takes its programmatic quality as seriously as its fundraising. We envision organizations who focus on programmatic outcomes with the same rigor that audit committees review financial statements.
Laser-like focus on programmatic outcomes is increasingly important in today’s funding environment. Without it, foundations and funders – many of whom have access to sophisticated software to analyze data and track performance – will measure your nonprofit according to their own definition of success. And you may not like their definition.