We have both been asked many times about our views on board member giving so this week offering a freshened version of a column from 2015. It’s always surprising to us, no matter how many times we know it happens, when board members don’t make monetary contributions to the organization.
Nonprofits depend on the generosity of donors in the community and if the group most responsible for the welfare of the organization doesn’t give, why should anyone else? We believe board members should all make an annual personal gift.
Here are several ways boards choose to address this important board responsibility.
Our favorite is for the board to set a goal for 100% giving in which every board member is asked and expected to make a personal gift that is meaningful and significant to them. Meaning and significant can best be described as being a bit of a stretch to make. We’ve worked with board members where this was $100,000 and others where it was $10 a month. 100% giving significantly demonstrates the board’s commitment to people outside the organization. Most funders, and many savvy donors, ask about board giving as part of their application or decision making process. If your board’s answer is less than 100%, the likelihood of receiving a gift or grant is greatly diminished if not eliminated.
Alyce Lee: I encourage nonprofits to treat board members like any other donor and approach them individually for a gift. Avoid asking everyone as a group which is essentially not asking them because it’s not done from one board member to another. I also ask board members not to ask, expect or assume the Executive Director will handle this task. Board giving is a board responsibility and is best done on a peer to peer basis.
Another method is for a board to require a minimum gift amount. Some organizations use this strategy because it ensures everyone gives equally. The biggest challenge with this method is determining the required gift amount. Set the amount too high and you eliminate some people with other skills and perspectives from serving on your board.
Set the amount too low and you may shut down bigger gifts from board members with the capacity to give more. This method can also create a glass ceiling and discounts the 100% giving principle in which is everyone is asked to make a gift that is meaningful and significant to them. Human nature has demonstrated and donor research confirms 70% of donors give the lowest possible amount.
Kelly has told me she’s seen the big giver give more even when there’s no minimum giving level but the rest of the board won’t give at all or will give a very minimal gift without a required minimum gift.
We both agree the answer to 100% board giving is education. Board and staff leaders must continue to educate people before they join a board about what is expected. Every board should have written board expectations that are shared with prospective board members before they agree to serve. If you are thinking about joining a board, ask about giving expectations in advance. Once you have joined the board, make your gift before asking others.
An area where we don’t agree is around board members raising their gifts. I believe selling tickets and recruiting sponsors to special events should be expected of all board members in addition to making a personal gift even at modest amounts. Events typically provide benefits back to the donor so it’s common for only a portion of the ticket price to be a donation to the organization. Contributing to and supporting special events is important for many reasons and has even greater credibility when the asker is also a donor.
Kelly: My favorite method for addressing board member giving is for the board to set a minimum “give or get” amount. In my experience, fundraising can be successful when board members can raise the money through sponsorships in addition to writing a check. It allows for more diverse members of the community to serve on the board.
If you require a $1,000 gift and it has to be cash there are a limited number of community members who can do that, which means the organization loses out on the input and hard work of others willing to serve. I agree with Alyce Lee that selling tickets doesn’t count. Every board member should sell tickets to big annual events and smaller ones if they can.
We’ve both seen boards waive the minimum giving requirement for one or two board members, typically because they are subject matter experts. Neither of us think this is a good idea and both agree it can create an unhealthy division within the board and beg board members to value their services above their giving, so we don’t recommend doing this.
Alyce Lee: I’m all about board members asking others to give but not as an alternative to making a personal gift. It all goes back to 100% board giving. Board members must be buying what their selling to have credibility when asking others and advises people not to join a board if they are not willing to make a personal gift.
We both agree in every example gifts need to be cash. In-kind goods and services are extremely helpful and welcome as a regular part of board service but they are not a replacement for a cash gift. Like any business, nonprofits run on money.
Over the years, many board members have told us their time is valuable and that’s how they choose to give. We recognize the importance and contributions of volunteers who serve the organization by donating their time. Board members require an even higher level of commitment.
Board members agree to serve by giving their time, talents and financial contributions. On this issue we both hold firm.
We absolutely agree board member giving is important. As with everything else about nonprofits, there are 1,400 examples of circumstances that might be exceptions. Start-up organizations are different than organizations that are fully developed.
A small nonprofit might set a small giving level and then still have trouble identifying board members willing to join while a university or hospital foundation might have a waiting list with a $20,000 giving expectation.
A nonprofit mandated by statute to have elected leaders or client representatives on the board may have to navigate differently around this issue. A beloved board member might lose their job and be unable to make a gift. But for the most part it’s not that complicated. Board members should financially support the organizations they serve.
Kelly Otte, MPA, and Alyce Lee Stansbury, CFRE, collaboratively produce Notes on Nonprofits and love to hear from you. Tell us what you think and send questions to email@example.com.