There is a lot of nonsense out there on the internet these days stating that the board of directors of nonprofit organizations should not or don’t have a major role in raising significant dollars for their institutions. Or they have never been effective in raising major gifts. After 40 years in this business, that is a bunch of bunk in my opinion! We specialize in managing capital campaigns, in fact, several each year, and those organizations that take the time to recruit, orient, and train their boards about their role in fund development, hands down raise more money than those who do not. Obviously, not all board members are good solicitors but there are a number of other areas they can contribute to increase the effectiveness of your major gift effort. Let’s see how this works, answer the following questions:
How does the board of directors of your organization feel about fundraising’?
Is fund development considered a board responsibility?
Are staff members solely responsible for handling this major task?
More importantly, do you have a team of staff and volunteers to help in raising major gifts?
The reality is that your organization needs to raise funds from the private sector through charitable gifts, whether or not you have staff to do the job. Successful fundraising requires a team effort, which means having the board leadership work alongside a team of competent and professional staff.
First and foremost, successful fundraising requires good leadership from its board directors in conjunction with the staff of the nonprofit organization. It is essential for the organization’s leaders to understand and express the importance of their role in fund development as it allows for the board to continue its involvement in bringing in funds. More specifically, it would be helpful if both the board chair and the CEO possess the skills to motivate the board members as well as keep them informed about their continual involvement in fundraising for the organization. Therefore, board leadership should not be afraid to ask members to fundraise even if there is some resistance from these individuals.
It is critical for board leadership to be direct and specific about tasks that need to be completed.
As much as general planning is important to a nonprofit organization, board members are not always going to take the initiative if the tasks have not been presented to them in a clear and concise way. It is important for the CEO of the organization to meet with board members individually and be able to ask them to take on particular responsibilities. Often, board members are well aware of the need to fundraise but lack the knowledge and resources to take action and get started.
Directors Help Establish the Environment in Which Major Gifts is a logical outcome of a planned approach.
Directors can fulfill a unique role in establishing an environment in which major gifts are looked upon as necessary, all-important, and possible. Thus, obtaining major gifts becomes more than just an unwelcome job: it becomes a whole way of life for the nonprofit organization.
If the directors at your organization say or feel that they do not understand how or why donors make major gifts, or that they do not know anyone who can, or that they themselves do not make major gifts, there is little hope that other volunteers or members of management will commit to putting in a sustainable effort to locate, cultivate, and obtain major gifts.
However, if your organization has at least a few board members who feel that people who believe in the institution should make major gifts, or who recognize that they have friends and associates who are capable of making major gifts, or who prompt other directors and the management to plan and sustain an effort to obtain major gifts, then inevitably you have an institution which will be open to receiving major gifts.
How Do Directors Establish This Kind of “OPEN” Environment?
There are significant ways in which the board of directors can greatly influence the flow of funds into their nonprofit organizations. According to Fisher & Howe of the National Center for Nonprofit Boards, there are five principles that board members should recognize and understand regarding fundraising:
- The board alone is ultimately responsible for attracting funding resources to ensure the financial viability of the organization and its programs.
- Asking for and giving money are natural processes and need not be viewed as something to be avoided.
- Board members should help in preparing the “case” or otherwise know the rationale for supporting the organization, and they should be able to explain the case persuasively to any prospective donor.
- Every board member can do something useful to support the fundraising effort by employing his or her own skills and interests.
- Being motivated and sharing, this motivation with board members is the most critical and the most difficult task of all.
There are at least seven ways in which directors can help establish an institutional environment and encourage the obtaining of major gifts:
- Establishing a Belief in the Organization’s Plans for Success
An effective director usually joins the board of an institution because he or she believes in its mission and vision for the future. Directors who believe wholeheartedly in an organization’s mission and goals can generate enthusiasm amongst other directors, managers, volunteers, and prospective major donors. This belief in the mission is the first step for an effective director of a nonprofit organization.
- Establishing Priorities
Directors have many interests and demands to address at all times. Thus, it is vital that these individuals view the nonprofit organization as a priority, meaning it is considered important for them to invest their time, energy, and financial resources into the organization voluntarily. The organization should be at least one of the top three organizations that they support!
Successful directors also establish priorities for various projects within the institution. For example, when establishing a new service line, increasing endowment, building/renovating a new facility, or increasing the reservoir of funds for community education are considered priorities, you will see projects initiated and sustained. Most importantly, you will be able to better identify major gift prospects and cultivate these funding opportunities successfully.
- Establishing Identity
Directors can establish an identity for their nonprofit organizations if and when they:
- Identify themselves as representatives of their institutions, which is invaluable in attracting influential donors
- Identify the institution with its mission and goals
- Identify prospective major gift donors who are or could be deeply interested in their organization’s mission
Some directors constantly identify themselves with their institutions, and their enthusiasm naturally wells up in the course of their everyday activities. As a result, these institutions will achieve local, regional, and/or national identity, while others will remain almost invisible because of their lack of support from their board directors.
- Establishing Planning Procedures
Directors should establish planning procedures for their nonprofit organizations. Big gifts cannot be obtained without big plans that have not been well organized. There are institutions in which the development program is reduced to mere fundraising because the strategic development planning – and even short-range planning involving major gifts programs – has come to a standstill. Often the development has not paralleled the institution’s planning efforts and is not integrated with clear objectives into the overall plan. Through their own insistence and interest, directors are able to see that planning is inaugurated and sustained. Since major gifts do not come from personal contacts and “clout” alone, it is important to develop well-formulated ideas, concepts, programs, and plans in order to attract major gift donors.
- Establishing and Encouraging Involvement
Most major gifts – $25,000 and up – come from donors who are involved with the organization. Directors can encourage and establish involvement in fundraising by helping to identify and cultivate new directors. These individuals are chosen based on their capacity to nominate and cultivate prospective board committee members, advisory groups, development committees, and development participants at various levels. By insisting on involving volunteers and prospects with the ongoing projects of the institution, board directors can pave the way for major gifts.
- Establishing and Encouraging Expressions of Appreciation
Expressing gratitude to those who give generously is vital to any nonprofit organization, and directors play an important role in donor recognition. Directors can establish a way of life in which showing appreciation is spontaneous and genuine by:
- Encouraging management to recognize and thank donors in many ways
- Going out of their way or “above and beyond” to express appreciation themselves
- Remembering past donors and recognizing the fact that involved families may have survived a difficult or tragic event
- Keeping the organization from being a closed society
Often a well-planned donor and volunteer recognition effort can elicit gifts that otherwise may never have been given: this should be a major function of the board of directors. For example, when was the last time one of your board members called a donor and said “Thank You”? Don’t be this organization “You know I only hear from them when they are looking for money”. Having your board reaching out to your past donors will pay dividends for years to come for your organization,
- Establishing Action
Directors can insist on the clarification and articulation of their organizations’ aims, plans, programs, and schedules to carry out these mentioned plans. In addition, board directors can insist on action from their own board members and encourage support for these programs. The director’s interest in the development program and in the progress of obtaining major gifts will prompt management and staff to progress further as a team.
Obtaining major gifts is not just a phase of a development program; it is a way of life for a nonprofit organization. This way of life involves constant reinforcement of the mission, continued planning, the supporting of projects which will help fulfill the mission, enlisting directors and other volunteers who give the organization high priority in terms of time and money, expressing appreciation, and following a sustained and active process of identifying, cultivating, and soliciting new prospects for major gifts. Therefore, directors of a board should help create an environment in which all of these objectives can be achieved through time, commitment, and a team effort.
There are many different roles that board members can play in fundraising, many of which do not include actually asking someone for a gift. For example, key steps in the fundraising process generally include:
- Identification and qualification of prospective donors;
- Development of a strategy for each individual donor;
- Cultivation of the donor, including opening the door, making the introductions, introducing the donor to your mission and goals;
- Involving the donor in the good work of your organization, i.e. tours, meetings with program or senior staff leadership;
- Solicitation or ‘making the ask’;
- Donor recognition, i.e. calling to say thanks;
- Steward —ensuring that the donor’s gift is used where intended, being accountable, reporting back on the change that has occurred as a result of the gift; and
- Renewing the gift.
Of all these steps, only two involve actually asking for a financial contribution —initial solicitation and renewal; however, ALL of these steps are required for successful fundraising.
A common excuse that board members give for not contributing financially to their own organizations is that they contribute their time. These days, “I give my time” would be considered a lame excuse to avoid giving financially to an organization. Furthermore, many corporate and private foundations will not even entertain an organizational proposal unless there is 100 percent support coming from the board. The reality is that almost everyone who works for a nonprofit organization contributes their time to some cause related to the community. If you are inclined to philanthropically supporting the good work that is being done in the community, then you are likely to volunteer somewhere. Thus, if you are trying to build a relationship with a potential donor, you need to be able to demonstrate your own commitment of time and resources.
A board that is heavily involved in fundraising is a true asset to any nonprofit organization. One of the first things that CEOs often say once they are given advice about bringing in new funds is, “Well I don’t know who is going to do it.” For every time this statement is spoken, there is probably an under-utilized board of directors. Smaller organizations, in particular, simply do not have the manpower to carry the fundraising load; therefore, the benefit of board members in a nonprofit organization is their ability to volunteer and provide the manpower needed to cultivate major gifts.
If your board is not fundraising, they are depriving the organization of critical resources. Thus, the board’s involvement, whatever it is in nature, is essential to successful fundraising for any nonprofit organization.
Remember, there are numerous ways to approach board giving and certainly no right or wrong way. One way that is generally felt to be comfortable and reasonable is to have a stated expectation that board members will make the organization one of their top three philanthropic priorities on an annual basis, especially if they plan to stay on the board. Your organization’s goal should be to achieve 100 percent giving commensurate to each board member’s individual circumstances. Your nonprofit organization will never receive major gifts without a board of directors that is committed and involved in its fund development program.
Best of luck,
Ron J. Huddleston
