Donors may not care about results, but boards should

“Despite years of claiming the contrary, donors still don’t really care about nonprofit performance or impact.” In fact, as blogger and student of philanthropy Tim Ogden reports, a majority of donors believe there “isn’t much difference between nonprofits, that any giving is good, and performance measures are a waste of time and money.”

For all the calls for proof of impact, for most folks, a touching story trumps facts most of the time.  It’s what Ogden refers to as the “Lake Wobegon problem: the idea that all the nonprofits I give to are above average” so don’t bother me with dry details.

After decades devoted to convincing ourselves that donors care about impact, the fundraising profession now discovers that donors don’t. We’re faced with the fact that the folks writing the checks select nonprofits based on personal relationships, not performance.

Talk about a kick in the pants to the data hounds in our midst – the institutional researchers, the spread sheet gurus, the number crunchers. All those lovely metrics and no one to love them. Which has the researchers wringing their hands at the silliness of the giving public for doling out their hard-earned cash with nary a concern about outcomes.

But truth be told, I’m not much bothered by donors’ disdain for data. (In fairness to the Ogden article, he is.) After all, organizations don’t (shouldn’t) assess to impress.

However, when boards of nonprofits choose stories over stats, well that’s another matter. Now I’m bothered.

NO BOARD LEFT UNINFORMED

Information is a board’s primary asset for leadership and change. Absent data to illuminate the way, board members wander in the dark – which helps explain the stumbling, bumbling state of the nonprofit sector these days. Governance by anecdote doesn’t cut it.

Boards must care about organizational efficiency and effectiveness, even if other folks don’t. That’s what it means to be responsible fiduciaries. As stewards of a sacred trust, boards must fix their attention and meeting agendas on issues of strategic importance to the organizations they serve.

Board members should be comfortable in asking tough questions and CEOs in receiving such. And boards should expect that the answers received will be shaped by careful analysis, subjective interpretation of the organization’s situation, and the occasional judgmental comment. No bad news isn’t necessarily good news.

So if it’s stories that givers want, let the tale-telling commence. But when it comes to boards and administrative teams, I’m pushing for facts.

Don’t get me wrong. Stories sprinkled judiciously throughout a board meeting encourage and inform board members in their work. My goal isn’t to turn boards into “heartless calculating machines” (Ogden’s words). I’m looking for a just-right blend of head and heart, of reason and emotion.

At the end of the day, it doesn’t much matter if donors don’t care about nonprofit performance or impact (although I wish more did).  But it matters very much that boards care.

For more on this topic, see:

Ask, and a helpful mission statement will be given you.

What if the board truly believed God owns the organization?

A five-step cure for boredom in the boardroom

What's your take on this topic?

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