As printed in CRAIN'S DETROIT BUSINESS
December 02, 2018 12:01 AM
Time for change on our region's nonprofit boards
We stand at a pivotal time for the future of the nonprofit sector in our region. Now is the time for businesses and corporate leaders to take advantage of an opportunity to make an even stronger commitment to our community than ever before.
The business community already plays a big role through its corporate social responsibility initiatives and by sitting on nonprofit boards. Yet in the face of generational change, boards must become much more diverse, in their thinking and in their recruitment practices, to help organizations sustain and grow.
In just less than four years, there have been an estimated 240 nonprofit CEO turnovers in Southeast Michigan. Even though that large number was predicted and replicated nationwide with the change in leadership, mostly due to baby boomer retirements, some of that movement has been driven by other market forces which boards must better understand.
As board governance moves to more of an entrepreneurial model, such as driving earned revenue, social enterprise and other emerging tools, it is imperative that nonprofits, foundations and businesses are on the same page when it comes to succession planning for the C-suites at charitable organizations and institutions, as well as succession planning for boards of directors themselves. That should include terms for members, better recruitment of potential leaders and other strategies.
Board members need to come to the table more aggressively and contribute deeper strategic thinking, based on their business practices and on other board service examples they have witnessed. There have been too many instances locally of lack of board oversight, or where outgoing nonprofit CEOs have had their thumbs pressed too tightly on controlling their board, much to the detriment of the people they are supposed to be serving. To rectify that troubling trend, board members must:
Focus on sustainability and growth to further their organization's missions, with a greater emphasis on accountability in financial projections and reporting to their funding sources
Take charge of CEO succession planning, invest in growing talent internally and put resources behind education and training of executives
Take a much longer view of future board leadership by recruiting a younger and more diverse talent pool to the full board level, earlier every year.
Collectively, the nonprofit sector needs to do a better job of convening board members from various organizations much more regularly, to share best practices, trends in the industry, and to have more meaningful conversations about potential mergers and collaborations, which have been lacking in the sector.
A renewed focus on board roles and responsibilities, separate from, and sometimes in conjunction with nonprofit CEOs, will help everyone. Additionally, more aggressively identifying and placing future leaders on the board and staff levels will benefit every stakeholder impacted by the sector.
Together, let's keep the positive momentum going, for the future of our region.