Board Cafe: The Board's Role in Raising Money

Board Cafe

"I didn't sign on for fundraising!" – The Board's Role in Raising Money
 

An all-too-common scenario: the executive director is frustrated because she thinks it's the duty of the board to raise money – but some, if not all, are reluctant. A few board members agree with her and they say (or pay for a consultant to tell the board): "Every member must give, get, or get out." We board members typically have three reactions simultaneously. First, we resent being required to do something we were not informed of when we were invited to join the board. Second, we feel guilty anyway. Third, we doubt we could succeed at raising money, even if we were to try. It's as if we were invited to a potluck, arrived with lasagna, and then scolded for not having brought a chocolate cake!

To untangle this knot of misunderstandings and uncertainty, it's helpful to think of the board as having two roles: a Governance role where the board acts as a body to ensure accountability, and a support role where board members support the organization, acting as individuals, through volunteering their time and participating in various ways in raising money. Ensuring that the organization has a realistic strategy for obtaining money is a critical governance responsibility of the board of directors. But that strategy may or may not include individual fundraising by board members. The strategy for raising funds will probably include a combination of efforts: fees-for-service (such as tuition, service fees, registration fees), tickets to special events, membership dues, direct mail campaigns, government contracts, and individual major donor gifts.

It's good to keep four critical guidelines for boards and fundraising:

  1. As a body, the board is responsible for approving and monitoring performance of a revenue strategy that will sustain the organization's work.
  2. In the context of that plan, as individuals, each board member must do something to help implement that strategy.
  3. No one person has to be involved with every type of fundraising, and
  4. Expectations must be clearly communicated to new board members during the recruitment process.

In other words, there should be methods that take advantage of each of the individual strengths that board members have and are willing to contribute.

The board's Governance responsibility is to ensure that a suitable financial or revenue strategy is in place. This strategy must have three characteristics: a) it will result in funding needed by the organization for its work; b) it will provide funding for an emergency reserve, evening out cash flow and organizational investments (such as in new computers or carpeting, or a publicity campaign); and c) it is in line with the organization's ethics and values (for example, whether or not a community center should accept donations from beer companies).

For a breast cancer awareness center, the board may consider several funding strategies, such as a) a combination of foundation grants and an annual dinner/dance; b) a combination of participation in a combined breast cancer walk-a-thon and publication sales; c) mail appeals combined with major individual gifts; d) government contracts combined with foundation grants, etc. This board may decide to adopt a strategy of participating in the walk-a-thon, selling publications, and soliciting major individual donations. This decision is based on what is realistic for their current board and staff to take on, as well considering the opportunities most available to them.

At the breast cancer awareness center, board members in their Support responsibilities agree that each board member will participate in one or more activities. One board member volunteers to bring 10 people to help at the walk-a-thon. Another will send out email publicity about publications to book editors and bookstores. A third agrees to hold a party at her house and ask her friends to attend for $1,500 each. Each board member supports, in a way comfortable for her, either the contributions component or the earned-income component of the revenue strategy.

In short, the board's Governance responsibility is fulfilled in choosing and monitoring a revenue plan, while individual board members Support the organization by participating in the plan's implementation. Clarifying this distinction, as well as the role expectations of board members, will go a long way towards calmer, less emotionally charged, more productive discussions about fundraising.

Related Board Café articles (archived at http://www.boardcafe.com):

Five Things One Board Member Can Do to Raise $100 to $5,000
Two Simple Ways to Communicate Expectations about Money
A Board Member Contract

Original publication date: 3/4/2008

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