Equity, power, and the future of the nonprofit sector
When it comes to nonprofit governance, we need to be visionary. These are complex times that are shrinking or stretching resources, challenging organizations to do things differently, and presenting opportunities for innovation. Nonprofit leaders are beginning to see that the governance of organizations sits within a larger context of equity, power, and the future of the nonprofit sector. Nonprofit governance is not consistently meeting the needs of the sector and needs to be reimagined – but how do we get there?
Recently Vu Le, a leader in the sector and the face behind the popular blog Nonprofit AF, posed a stark question to nonprofits and charities: Why do we keep doing things the way we do?
As Vu notes, the spotlight shouldn’t necessarily be on individual board members, many of whom are doing their best and actively contributing to the organization. Rather, it’s the system and the design of governance that should be reimagined. As ongoing conversations about racial justice remind us, it is simply not enough to focus on the symptoms of an issue: solutions must hone in on the root of the problem.
The root issue of nonprofit governance is its design. We have been thinking about the design of governance so narrowly. Typically, governance is equated with the board of directors and there is a false line in the sand between governance and management. On the ground though, we know that’s not how it really works.
Though there are many examples of strong boards, the reliance on a model that revolves around the functionality of just one structure (the board) means it’s vulnerable to a variety of factors. For instance, folks in the sector trade stories of good governance going sideways due to single factors like a new board chair coming in. One or two factors should not derail the effectiveness of a system. Considering that governance is a system with many structures, players, influences, and processes not only consisting of the board could result in more resilient governance systems.
The current design of governance emphasizes just one aspect of governance: the performance of the board. Thus, there are a variety of very important programs and courses that work to nurture and support the capacity of the board to do its work well.
However, governance is a much more complex system. We need to make this invisible system visible: a web of players including CEOs, management, funders, community partners, and members. In doing this, we can change how we see the playing field of governance. Adopting a bird’s eye view reveals there are many interrelated parts of the governance system and this allows us to identify where power may be concentrating, and possibilities for equity that extend beyond the boardroom.
Boards of directors have also carried an enormous weight of responsibilities, which has grown over the years. The expectations and pressures are only higher now, and governance leaders across the sector are struggling to juggle many factors. Some have likened the experience to “dancing as fast as we can on a shoestring” – and that was before COVID-19.
In short, a lot is being asked of boards. Organizations are facing issues like growing deficits and other high-risk decisions. Placing these decisions in front of a small group of volunteers to make, who may have limited capacity or knowledge is unrealistic and as Vu further points out, could even be harmful to the organization and its mission. Creating a wider network participating in governance decisions not only opens up more possibilities for the work, but takes care of those who are needing to make those decisions.
There are many examples of different board governance models, but they often don’t factor in the organization’s unique circumstances – like fitting a round peg into a square hole. In order to ensure organizations have governance systems and practices that work for them, their governance system must consider their fixed requirements, organizational life cycles, and many other factors. In other words, how can we create what we need rather than simply work with what we were given?
Research shows that there is a big opportunity for real transformation. So, where to start? One place to start could be reframing the questions we ask about governance to consider the broader governance system, not only the board. For example, instead of asking ‘How can we fix the board’, we could ask ‘What is the most effective way for us to fulfil our governance’? As one governance leader put it, “How can we start seeing the board as the host of governance, rather than the home of governance?” Or imagine, as Creating the Future has done with their “integrity board”, if all organizations started from a place of “what do we want the governance of this organization to make possible for accomplishing our mission?”.
As the world reconsiders what the future of work will look like, it is time to experiment, be messy and imperfect in order to better govern organizations and in turn, better serve communities. That includes getting innovative in seemingly rigid, unshakeable areas like nonprofit governance. In fact, maybe those areas of greatest rigidity are where we must be most innovative. What could we discover if organizations could shape their own governance, to their own purpose and circumstances? It’s time to push ourselves.
Reimagining Governance, in collaboration with Ignite NPS, is an initiative with the overarching goal of provoking a shift in how nonprofits think about and undertake their governance. Through research, connecting with sector leaders, and experimentation, Reimagining Governance is developing a Transformative Design Process that will enable organizations to shape their own governance, rather than fit into prescriptive models. Sign up for Reimagining Governance updates to learn more or get involved by contacting firstname.lastname@example.org.