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The Market’s Toll on Charitable Giving

October 1 - The extreme stress experienced from Wall Street to Main Street since September 15 is rippling into the nonprofit and philanthropic sectors, and will hit some organizations more like a tsunami. Nonprofit organizations know two things: that their budgets are highly vulnerable, and that the people they serve will be hardest hit.

Here are my recommendations:

For nonprofits:

1. Boards matter now more than ever before. You must get your board in order. This is no time for foot-dragging with board members who do not bother to attend board meetings, make contributions, or ask others for money.
2. Now is the time for boards to sit down with the CEO, make sure the organization has a compelling mission (the reason you exist, the value you add), make sure the organization has a compelling vision (where you are taking the organization in the next few years), and determine how you will achieve success – strategically and financially. The CEO’s role is critical in providing the expertise to prepare the board for this conversation.
3. Boards need to be comprised of people from diverse backgrounds and networks in order to ensure a full and rich understanding of the needs and interests of the community, the creation of a robust strategy, and a powerful case for support. If board composition needs to be strengthened, attend to this, and build the board.
4. Every board member needs to be involved productively in helping to accomplish the vision and advocating for the organization among his or her networks. And every single board member must make a contribution that is personally generous!
5. Board meeting agendas must be focused on key organizational and strategic issues - what has been accomplished since the previous meeting, what needs to get done in the march towards the vision, and what is needed from the board. (Good preparation is key to good board meetings.)
6. The CEO must be excellent – a highly effective professional, who is expert in the needs of the community and the work of the organization, and effective in building relationships with key constituents and funders.
7. Excellent board leadership is also key – a great board chair who is the role model for board members, along with good board officers and committee chairs.

For corporations and foundations:

1. Invest in organizations that are having the greatest impact in making communities stronger and more sustainable. And, yes, expect organizations to show how they are achieving meaningful results.
2. Expect boards and CEOs of nonprofits you fund to perform well as shown above. You can leverage your support to pressure boards to be engaged and supportive. You will be helping the organization and the community.

For business people who are choosing boards:

1. Choose boards where you will be able to add value…to advance a purpose that is meaningful to you.
2. Once you join the board, help the board to envision the organization's greater potential, build a vibrant revenue model and achieve success.
3. Be generous!

These will be the toughest times for nonprofits to access revenues, but there will still be a flow of funds from government, corporations, foundations, individuals, and fees. The dollars will skew to organizations that have CEOs and boards who make sure that their missions are relevant, their staffs are delivering high quality and meaningful programs, and their boards are generous and fully engaged in building relationships and advocating for support.