Show Me The Money

Nonprofit board leadershipphilanthopy is typically a pay to play/give or get proposition. Nurses often ask me about this – the philanthropy of board leadership. As board leaders of nonprofit organizations, it is important to understand the mechanisms of philanthropy. To begin, nonprofit organizations rely on a combination of philanthropy, grants, and revenue generation to survive. There is a myth on the street that nonprofit organizations cannot generate profits. Actually, laws allow nonprofit organizations to generate profits as long as a percentage of the profits are re-invested in the organization. That’s a good thing. It allows nonprofits to grow, re-vitalize, and continue to meet the changing needs of their stakeholders. If nonprofit organizations continuously ran in the red; debt-ridden with no profits at all – they would not survive. So profits are good!

Nonprofit boards of directors are the role models of nonprofit organizations. They are loyal, obedient, and care about the mission as it relates to stakeholders/constituents/individuals served by the organization. As role models, board members must set the example to provide philanthropic funds in support of the mission. In fact, many grant making entities will not provide grants to nonprofit organizations unless there is clear demonstration of 100% philanthropic donations from board members. If the board is not vested in the organizations, why should anyone else invest?

That is the premise behind pay to play/give or get. Pay to play literally means if you want to be on the board, you must make the promise of philanthropy. Somewhat different, but very similar, is give or get – meaning board members are either required to give philanthropic donations or get donations from their networks. Both can be powerful sources of funds for organizations. Nurses who serve on boards should consider both sources of philanthropic funding. If personal funds are tight, a donation that is personally prudent is acceptable if funds can also be solicited and secured through other sources. Together, these philanthropic sources can add up and make a difference for a nonprofit organization.

What sources of funding can be considered in the give or get model? Family and friends are always a first line of inquiry. If you are vested in an organization, perhaps  you can convince your family and friends to support the organization, too. What about friends and family who own or work in for-profit companies? Do those companies have philanthropic foundations? Many do and look for good causes to donate to. Approach them about donating to the organization you care most about – the one whose board you serve on. What about your great-Aunt So-and-So who always saved and now has a large sum of money to donate to a good cause? Maybe the organization on whose board you serve is just the cause.  Approach her about the organization. Describe the mission, great outcomes, and people whose lives are changed by the mission. Invite her to visit and see the mission in action – and let her know you would like her to consider a donation – no need to create mystification. Be upfront about philanthropy. Philanthropy is a good thing!

Some boards require large annual donations. Other boards are less intensive about philanthropy. However, all nonprofit organizations expect their board members to give or get/pay to play. As nurses, we often shun the money talk – after all, we are about the caring, right? Well, yes, and to serve on boards of directors we must shift our sometimes-negative relationship with money. Understanding philanthropic expectations is a critical conversation to have as part of the board nominations process – reduce the mystification! If you cannot meet the expectation, ask about attracting funding from others in lieu of personal giving. If that is not an option and you cannot meet the philanthropic expectations, politely bow out of the nominations process. There are plenty of boards with different expectations for philanthropic giving. You can find one that fits your budget. But you must expect to give or get/pay or play if you want to serve.

If you are considering engaging in board leadership, inventory your philanthropic capacity first. What amount can you afford to donate? What about philanthropic capacity of your networks? Are there sources of funding you have not yet considered? Perhaps now is the time to engage in these conversations with family, friends and other contacts. Broadening your influence through philanthropy development is a key skill for board members. It’s never too soon to start!

 

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