Is your board more like a chef's salad or mixed greens? It may seem odd to refer to a board of directors as a salad, but the simile just popped out the other day as a way to explain the importance of diversity on nonprofit boards. And by diversity I mean not only ethnicity, but also skill sets, socio-economic background, profession, personality, and the myriad other characteristics that inform people's decision-making capability, and thus contribute to a nonprofit's governance.
One of the biggest challenges of board development is reaching constituencies in the nonprofit's community that are, as yet, un- (or under-) represented on the board. It's far easier to simply bring on more of the same kinds of folks that are already members. But this isn't healthy for the nonprofit in the long run.
I learned this lesson early in my career. I was working in development for an opera company. The company was just three years old, and building a board had been - as it is for most nonprofits just starting out - challenging. When I got there, the board was populated by people, not surprisingly, who loved opera. This was a good thing. They were passionate about the mission, supported it with personal donations, and willingly helped spread the word. Sounds ideal, right?
Well, the downside to all this love of opera was a distinct lack of anyone on the board with the background to review financial statements, to make long-term projections, or to question the artistic director's plans. The result? The company had racked up a million dollar debt in its first three years. Ouch.
The remedy wasn't easy, but it also wasn't impossible. The starting point for changing the situation was the board. We needed to recruit members who had a strong business background to complement those with passion for the art form. We set about meeting with corporate representatives from banks and energy companies, the telephone and cable industries, and soon we had a cadre of folks who appreciated opera, but weren't star struck and also had good business heads.
I remember the turning point came at a board meeting during which the decision over whether or not to bring in Placido Domingo was made - his popularity had reached its zenith and so had his fee. After impassioned debate, it was finally agreed that our small company just couldn't afford Mr. Domingo. That was a first.
With more decisions like that one and a good debt reduction plan developed by an experienced banker, the company retired it's debt in just three years. And the company was able to bring in Domingo for a fundraiser that was a huge success.
So take a look at your board: does it look like a chef's salad in terms of the breadth of backgrounds, skill sets, ethnicity, socio-economic level, and other characteristics important to the organization's mission? If it looks more like mixed greens, or worse like a chunk of head lettuce, it's time to work on board development!
Nonprofit-KnowHow addresses the nonprofit board, its unique role and challenges and how to develop yours to best serve your mission.