Are Nonprofit Boards a Good Idea?

On a trip to China last year, a leader in their nascent philanthropic community asked me if China should introduce the idea of boards to their social sector. It caught me by surprise. It had never occurred to me that a nonprofit sector could exist without them.

Are nonprofit boards a social innovation worthy of export or would you recommend other countries find a better model?

It is pretty easy to make a case for not having boards in the social sector. We just did a national survey of nonprofits (mostly under $5MM and in urban areas) and the data painted a pretty bleak picture.

According to BoardSource, the role of a board is to establish organizational identity/direction, ensure resources and provide oversight. So, how are boards measuring up to those standards?

Our survey showed that only 23 percent of nonprofit leaders reported that they adhere to a strategic plan. While personal giving is not the totality of a board's role in ensuring resources, the average nonprofit only generates around $10,000 from its board member donations. And oversight, well only 44 pecent state that their board is more focused on oversight than day-to-day operations.

Based on this data, it is hard to recommend boards to China. There is, however, one fact that prevents me from making that recommendation: Taproot wouldn't exist without our board.

Our board constantly keeps us focused on our mission and strategic plan. In the past 12 months, our board has helped raise $1.32MM (more than 30 percent of our revenue) and there has been 100 percent board participation in giving. The board has also proactively owned the oversight of our finances and other fiduciary responsibilities and pushed us to always do better. Perhaps most importantly, board members have been amazing mentors for me -- especially in my early years as an inexperienced social entrepreneur.

It comes back to something else nonprofit leaders reported in the survey. Only 6 percent of nonprofits feel they successfully recruit the right kind of board members. At Taproot, we make this a large priority and generally secure 25 nominations for each open seat so we can be sure to get the right people on the bus.

Nonprofits boards are worth exporting, but we need to solve for the board recruitment challenge. It is only if we can fix this issue that we are doing other countries a favor in replicating our model.

This week in Atlanta, BoardSource hosts the BoardSource Leadership Forum. Addressing this challenge needs to be at the core of the agenda and will certainly be the focus of my conversations in the sessions and hallways.

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