Tag: Nonprofit Board

By Sapna Sopori, Founder & Owner of Sapna Strategies, LLC

Via Community Centric Fundraising.

How would you feel if I told you that Jeff Bezos got his groceries for free from a food bank?

If he did, it would probably shock and anger you, right? These feelings come up because we as a society assume that nonprofits exist to support those who are unable to access the services they need, and in our country, one of the biggest barriers to access is wealth. So, it is safe to assume that NPOs do not exist to help people like Jeff Bezos.

But this assumption is not always the reality.

“Many of our country’s economic elite directly and regularly use nonprofit services at a discount or for free.”

Outside of frontline nonprofits (those that offer immediate services for those in crisis, such as disaster relief, food banks, housing shelters, etc.), many of our country’s economic elite directly and regularly use nonprofit services at a discount or for free. From Mercer Island to Aspen Valley, affluent folks access subsidized activities from nonprofits, such as guided nature walks at ski resorts, science camps at aquariums, art activities in high-end museums, and more. They enjoy all of these activities for free or at very low-cost.

Sounds unbelievable, right? Does it make you wonder why nonprofit organizations (NPOs) would financially subsidize their services for the wealthy?

It’s a good question, and one we are going to examine here.

To start with, we must first understand how these services are tied to donations.

Here is what most of us assume:

FIRST: A specific societal inequity is identified, one that most greatly impacts those who cannot afford to offset the impact on their own.

IN RESPONSE: An NPO is created to address said inequity and support those who cannot afford these services otherwise.

TO PROVIDE SERVICES: The NPO solicits donations to make its services accessible.

IN RESPONSE TO SOLICITATIONS: Wealthy donors give funds to NPO to discount the service.

ONCE FUNDED: The NPO uses donations to provide accessible services to those most impacted by the inequity.

Seems logical, right? And it can work this way, like with frontline NPOs. But when we zoom out to the broader nonprofit sector, we will see there’s more to the story, especially when we consider how we use our services to secure funding.

What often happens instead is something like this:

FIRST: A specific societal inequity is identified, one that most greatly impacts those who cannot afford to offset the impact on their own.

IN RESPONSE: An NPO is created to address said inequity and support those who cannot afford these services otherwise.

TO PROVIDE SERVICES: The NPO uses its services to engage wealthy donors in order to solicit donations to make the service accessible for all patrons.

IN RESPONSE TO SOLICITATIONS: Wealthy donors give funds to the NPO to discount the service.

ONCE FUNDED: NPO uses donations to provide free or discounted services for ALL patrons, including those who can afford to pay more and/or are not impacted by the identified inequity.

To illustrate how this works, let me give an example from my own life.

“If a majority of the folks served by these classes were affluent and could easily afford the “full price” tuition and beyond — why were they only paying $10/kid?”

I used to work at an environmental education nonprofit located in an extremely wealthy community, one in which a vast majority of residents were well-beyond comfortable — they were affluent. These folks were the primary users of this nonprofit’s services because it was located smack dab in the middle of this affluence.

Just like with many other nonprofits, the services offered were designed to be extremely affordable. For example, a 2-hour kids art class was priced at only $10/child. There were scholarships available for folks who needed additional support, but to take advantage of this, lower-income folks would have to spend money and time to travel to this nonprofit’s campus (#HousingSegregationInEverything).

If a majority of the folks served by these classes were affluent and could easily afford the “full price” tuition and beyond — why were they only paying $10/kid?

Based on countless conversations over the years with NPO professionals, the theory goes like this: NPO engines run off donations, and we often use discounted or free services to engage wealthy people and then cultivate them over time to donate. Potential large donors send their kids to a summer camp or they take a nature walk at a ski resort, they get on a mailing list, and hopefully down the road, they give a large donation.

So, why is that a problem? It seems to work, right? Even though this can work, I believe it does so with many harmful effects.

5 harmful effects that result when we subsidize our programs for rich people

1. It lowers service-providers wages

One of the most harmful ways NPOs keep prices down is by underpaying staff.

At the aforementioned NPO, I was a college graduate in a job that was nationally considered highly competitive, and my “compensation” was a stipend of $25/day (I worked 40 hours a week) and a shared room in a dormitory with utilities.

Here’s what my compensation didn’t include: health insurance, retirement benefits, student loan deferment, food, and more. It also did not take into account the high cost of living in the surrounding affluent community. In short, if you wanted to work at this organization, you had to be able to afford to work there. The low-cost classes provided by me for the affluent clients was made possible because I wasn’t paid well.

2. It limits staff diversity

Statistically, white people are better able to afford working for lower pay (like $25/day). BIPOCs in our country by and large have less accumulated wealth than white people. So it’s not surprising that when an NPOs offers low wages in a geographical area that has low racial diversity and high cost of living, we end up with lower racial diversity of staff in these NPOs. To further compound the issue, if these NPOs promote from within like so many do, you get a homogenous staff pipeline at all levels.

3. It further devalues our services

An argument I’ve heard in favor of keeping NPO service costs low for affluent clients is that these folks are “shopping the market as savvy consumers.” This brings a for-profit perspective into the nonprofit sector, and pits NPOs against each other, so that rather than working together to complement each other’s services, NPOs try to outcompete each other to provide the “best deal” and entice potential wealthy donors. But, many of our NPOs exist because the service they provide is already undervalued and underfunded by society. So, it is counterintuitive to further decrease our pricing because it reinforces the idea that our service is “low-value.”

To illustrate this, let’s go back to my experience with the NPO above: I would often hear complaints from wealthy parents, like “the NPO down the road only charges $8/child so why are you charging $10?” or even arguments to not pay at all because “I donate to here so this should be included.” These were the same parents who would casually share, “We just sent little Johnny heli-skiing for his 10th birthday,” an experience which costs probably about $2,000 , while I was earning $25/day to teach little Johnny and 15 of his friends.

Using free or discounted services may bring potential wealthy donors in the door, but it does not increase their perception of the value of our services; instead, it reinforces the perception that our services are not worth much. And this perception by those in power is part of the reason why our services are needed to begin with.

4. It promotes inter-team disparities

I have often found that the staff providing the services of the NPO are typically paid less than their philanthropy team counterparts. This is often justified by how much each team “brings in” financially.

For example, at the organization I previously worked at, I only “brought in” $10/child whereas a gift officer might bring in a $500K donation. And, in contrast to me, the gift officers were paid a livable wage for their work. And all staff knew of the pay difference between the teams … which created a lot of disharmony between two teams that needed to work together.

As mentioned above, the services provided by an NPO are already undervalued by society, so if we keep justifying paying service-staff less because of how much they “bring in,” we end up perpetuating the very inequities our NPOs were created to uproot. And, if we don’t address internal pay equity, there is the added negative impact to critical inter-team relationships.

5. It incentivizes NPOs to modify services for the wealthy

When programs, especially education programs, are used to entice wealthy people in ways that secure a donation, the program content tends to change from what is needed to really achieve our missions (such as systems-change education) to what the potential donors in the audience will be more comfortable learning (such as systems-reinforcement education).

As an environmental educator in front of a group of potential donors, I am far less encouraged to talk about the history and impacts of inequitable wealth distribution and how this contributes to environmental harm. I’m instead encouraged to talk about resource distributions for squirrels and flowers and worms. The content ultimately becomes “safer” for a potential donor in the audience so that we are more likely to get the gift. But the service is then less impactful for making the real change our missions require.

So, what can we do about this?

The practice of subsidizing affluence is deeply embedded in our culture, but changing our fee-for-service model is a big way NPOs can stop it. But it requires fundamentally changing how we think and act about money — and talking about money, especially with those in high-powered positions can be uncomfortable. So, if you do tackle it, expect waves — big ones.

But! Just because something is hard doesn’t mean we shouldn’t do it, right? So, here is a very simplified four-step plan that will at least spark good conversation at your organization.

The four-step plan

Step 1: Analyze what your service programs actually cost

Many NPOs have a hard time distilling the actual cost to provide services, but it is critical to revising a fee-for-service structure, so take the time to do it. And when you do, be sure to include equitable compensation for staff who are providing the service. This one will be a hard conversation, especially if pay-transparency is not part of your organization’s culture. But, this is absolutely fundamental if we want to be a part of the solution, not part of the problem. Have the hard conversations.

Step 2: Establish the actual “full price” for the service and build the analysis into philanthropy communications.

This is key because we can’t just raise fees out of nowhere. We need to explain the process above and how doing this will help us better achieve our mission. We need to clearly state how the previous structure was part of the system we are trying to change, and by redesigning our fees-for-service we will center the needs of those most-impacted rather than the expectations of those least-impacted.

Step 3: Offer a sliding scale for clients based on their self-determined needs.

Bluntly sharing the “full price” can jar affluent clientele used to getting a bargain for your services. By offering an opt-in sliding scale, we can communicate the real cost of making equitable change while allowing folks to self-determine how much they can afford.

This self-determination is regularly used in frontline NPOs. For example, I could use a food bank to get my groceries for free, but I won’t unless I financially need to. We have a societal understanding that if I take free food from a bank when I could afford to pay for it, I would be taking it away from someone who really needs the service . We need to cultivate that sensibility among affluent patrons of all NPO, not just frontline NPOs.

(FYI, I am not advocating to increase prices for low-income clients. I do not want anyone to unintentionally shame low-income clients for accepting support. While prices for affluent clients will increase as a result of this analysis, prices for low-income clients should at least stay the same if not decrease as they will be better supported by this new pricing structure.)

Step 4: Lastly, keep asking for the donation.

After the “full price” is shared with the clear rationale, ask the affluent clients to make tax-deductible donations for any contributed funds beyond the price. We have to be confident in our communication and believe that once we are clear and honest with our donors, they will donate, not because they got a discount for a class but because they believe in our work and see that we are living the change the world needs. And they are playing an active role in this, both in their donation and their payment for our services.

We don’t tend to think about how fees-for-service in NPOs can either support or undermine our equity intentions, but doing this hard work will take us one step closer to building a world in which everyone can survive and thrive, one where we feel proud of both the work we do and how we do it.

And, for some extra motivation, keep reminding yourself that you don’t want to be the NPO that gave Jeff Bezos a handout!

Header image: photo by Mathieu Stern on Unsplash

By Sapna Sopori, Founder & Owner of Sapna Strategies, LLC

Hi, Everyone! My last blog on racial equity and boards received a lot of support, so thank you for reading and sharing it! Surprisingly, it also received a number of requests from white board members asking me to push them even harder. That is amazing! Yes! Let’s do it! As a response to those requests, my latest board-focused blog below asks some hard, introspective questions about power. If you are a white board member on a majority white board and you want more of an RE push, this blog is for you! That said, consider the last blog like algebra class and this one is like calculus: If you felt really challenged by the last one, spend time to digest it more thoroughly before jumping to this one. Because this one is gonna poke at some sensitive spots, so you’ll need the resilience that comes from regularly grappling with racial equity and whiteness. Okay. You’ve been warned. Let’s go!

Acronyms used: HWL – Historically White Led organization; RE – Racial Equity; BIPOC – Black, Indigenous, and People of Color; BLM – Black Lives Matter; NPO – nonprofit organization.  

Welcome back, white board members, to the next step in your RE board development work! (note: be sure to read my last blog on racial equity and boards before launching into this one) So much of our effort to change our boards focuses on diversifying the board composition and bringing in more BIPOC members. But today, I want to take a closer look at the other demographic already in the room: the white board members. And, as part of my commitment to offer practical strategies in these blogs, I included a step-by-step activity for you to engage in.

Let’s start by setting a scene: imagine for a moment…

It’s a Friday night and you want to take your family out for a good meal, so you call the restaurant ahead of time and make a reservation. You show up on time, the kids are hungry, and you’re ready to enjoy tasty food after a hard week. You see that the restaurant is super crowded (this is a pre-covid scenario), and the host apologizes and says they don’t have capacity right now and asks you to wait to the side. You and the family do so patiently. 

As you wait, you notice a few things: 

• Only about 1/3 of the diners are actively eating, and the rest seem to be finished with their meals and are simply chatting with each other at their tables; 
• A few new parties enter the restaurant and get seated right away even though they don’t have reservations and haven’t been waiting (but you notice their “sleight of hand” tips to the host); 
• Some of the other folks who are waiting get frustrated and leave vowing never to return to this restaurant; 
• Some of the other folks who are waiting notice another restaurant across the street that has space and they leave quietly to go there. 

Finally, at around 8:30pm, a party gets up and leaves their table, and the host rushes over to you with apologies and asks if you’d like to follow him to the table. How does all this make you feel?

Now, let’s replace this hypothetical restaurant with your board room. The two are actually very similar:

• Board rooms also have limited capacity;
• It takes time for board members to “leave the table” (term limits); 
• Not everyone in the board room is actively engaged and are simply taking up space (as nonprofit reformer, Vu Le, says: “I have a Rule of One-Thirds when it comes to boards: 1/3 of them are helpful [and] 2/3 of nonprofit boards are useless or harmful.”);
• There are many ways to get onto boards that aren’t always consistent or advertised to the public (i.e. applications, recommendations from current members, recruitment by staff, a large donation, etc.) and this causes confusion as to who gets a seat, when, and why; 
• Boards have lost potential members who:
  • Leave to go to other boards; or, 
  • Leave frustrated and offended by the long wait and the lack of communication, and then let their communities know not to trust this organization. And the board members in the room may never realize the damage they have caused with their passivity. 

Sound familiar??? This frustratingly common scenario is way overdue for analysis. So, that is exactly what we are going to do today! We need to stop being passive “diners” taking up space in limited capacity rooms. We need to actively examine our board rooms, not only for who we want to bring into the room but who is already in the room and if they should still be there.  This is going to be hard because dominant culture does not encourage people in power (especially white people) to question whether they should have that power, how they got that power in the first place, and if those methods were racially biased. So, the activity below may be uncomfortable. But that’s good! If we’re not at least a bit uncomfortable doing this work, then we’re not doing it right! 

Step 1: Establish context:  

• Remember that NPO board members are volunteers. Yes, they are volunteers with a lot of responsibility and many even bring in large donations or powerful connections, but board members do not get paid by the organization for their work. So, any discussion about who should or should not have a board seat will not result in losing a job. Egos are at stake here, not paychecks.
  
• Let’s acknowledge the fear: you may be concerned that having hard conversations about whiteness and power with board members will result in them feeling hurt or offended, which may lead them to pull their donation or access to their networks. That is a possibility. We need to prepare properly for hard conversations, but we also need to give members the benefit of the doubt that they want to live their beliefs and will continue to support the good work of the organization without being “paid with power” to do so. 

Step 2: Examine your beliefs:

With that context in mind, let’s establish some shared beliefs. I crafted this list from the many npo racial equity and/or “we stand in solidarity with BLM” statements out there. So, keep in mind that I am not inventing these beliefs but rather restating them here as context for the self-reflection questions later. 

“I believe…”	Circle one:
I believe systemic racism is real and directly connected to the work of my nonprofit.	YES     NO
I believe racism can manifest in any/all structures, including in the structures of the board I serve on.	YES     NO
I believe npo boards have power, which impacts the communities their npos serve.	YES     NO
I believe BIPOC understand racism in ways white people can’t (i.e. reading “The New Jim Crow” as a white person is not the same as living as a Black person in America), and this understanding should be centered in racial equity work.	YES     NO
I believe BIPOC have or can cultivate the necessary governing/leadership skills to serve as board members.*	YES     NO
I believe those who are most impacted by racial equity decisions should have the power to make them. (note: If you amended this in your head to read, “have input on decisions” rather than “have the power to make them,” ask yourself if you really believe the previous two statements.)	YES     NO
I believe white allies on boards play a critical role in racial equity, and their actions should center the needs and voices of those most impacted by racial injustice.	YES     NO
I believe racial equity work is urgent and needs to happen now.	YES     NO

Step 3: Ask yourself some hard questions:

If you answered YES to any of the belief statements above, and especially if you did so for all of them, then continue to the questions below. These questions are designed to help you examine the power you have as a board member and why you have it. 

1. Why do you serve on your board? 
   • This seems like a simple question but let’s really analyze this. Most board members serve because they want to support an organization working on a cause they really believe in. Members are often asked to join a board because they have skills, networks, or experiences they can contribute to the benefit of the organization. But think about that logic for a second: being on a board is a power-position; does this mean we think board members are only willing to donate their skills, networks, or experiences in exchange for decision-making power? Is that true for you? Are you only willing to donate your services in exchange for a board seat? Or, would you be willing to donate your skills, networks, and/or experiences but without the final decision-making power of a board seat? If not, why not? 
2. Are you a member of the community/ies most impacted by the injustice your nonprofit is trying to address? 
   • Whatever sector your nonprofit serves – education, environment, housing instability, food scarcity, etc. – I can guarantee you that middle to upper class white people are NOT the most impacted by its injustices. So, if you are a middle to upper class white person and therefore least impacted by the work of your nonprofit, should you have the power to make decisions that affect those who are most impacted? Really grapple with this question. Clearly articulate your rationale and hold it up against the beliefs above. 
3. Are you taking action to be a white ally on your board?
   • As stated in the beliefs, we need white allies in this work to collaborate with BIPOC and leverage their privileges to identify and uproot racial bias in systems and build real, antiracist solutions. In other words, all “diners” need to be engaged and active in RE work when sitting in this limited capacity “restaurant.” As a white person, are you doing that RE work on your board? If so, what is that work? Attending meetings or working on a gala once a year is not RE work. If you attend meetings and hold the room accountable to evaluate their decisions with an antiracist lens, that is RE work. If you work on the gala and use your influence to equitably fill the room and contract a keynote on racial justice in your sector, that is RE work. If you are not doing this work, why not? What are the expectations of allyship for your white board members? Is there an unspoken assumption that the “new” board members (i.e. BIPOC) will be the ones to take on the RE work, and it’s optional for the “veteran” members?
4. Does your board turnover match the urgent rate of injustice? 
   • When working with majority white boards, I often hear, “we need to make room at the table for BIPOC to join.” But with limited seating, the only way to make room now is for the folks already there to leave. Are members only rolling off at the rate of your board term limits? Does this rate match the rate of the injustice your organization is trying to address? I have yet to hear a nonprofit director or board member say that their work isn’t urgent and doesn’t need to be addressed right now. If you believe your nonprofit work is urgent and that work is directly connected to systemic racism (see beliefs above), then developing the proper composition of your board to do that work most effectively needs to be just as urgent. Would you be willing to give up your seat before your term limit in order to make space for someone who is more impacted by the decisions being made at the board table? (note: this does not mean you would have to leave the work or the organization. There are other ways to contribute…see below.)
5. Have you considered flipping your role? 
   • Many majority white boards establish “advisory boards” comprised of the individuals most impacted by the injustices their npo is working to uproot: ex. an environmental org may have an advisory board of Indigenous Tribal Members. These folks are asked to “advise” the white majority board on decisions but they do not have the power to make these decisions on their own. Why not flip that model? As a least impacted person, would you be willing to serve as an advisor to a board comprised of folks who are most impacted? You could share your expertise as a policy-maker, lawyer, program-specialist, etc. If giving up this power makes you uncomfortable, dig into that. Go back to the list of beliefs above. Which of those beliefs are connected to this option of stepping up by stepping aside, and do you believe those?

Step 4: Make a plan…then, do it!

Congratulations for making this far into this activity! Now, you may be asking, “what can I do about all this?” Here’s my recommendation: 

• Do this work intentionally, not reactively. You don’t want to cause harm or jeopardize the legal status of your organization by making rash decisions. Make a plan, but make sure it has an urgent timeline that matches the rate of the injustice your organization is working to address.
  
• Redefine what it means to be “qualified” to serve on your board. Base your rationale on the beliefs you stated in your RE and/or BLM Solidarity statements. Ask yourself, “what do we really believe in, and what are we willing to do to live our beliefs?”
  
• Develop a pipeline of potential members who meet your new definition of “qualified.” If you need support creating a pipeline of BIPOC board members, consider partnering with an organization whose goal it is to get BIPOC professionals on boards, like the Black Board of Directors Project. Or, really put-your-money-where-your-solidarity-statement-is and hire a recruiting firm (BIPOC owned and operated, please, like BIPOC Executive Search).  
  
• Have the hard conversations with your board chair and/or executive committee about who needs to have decision-making power and who can advise those with power in order to best meet the needs of the work (i.e. step up by stepping aside).
  
• Examine your board matrix to prioritize who is in the board room and why. Related, hash out the role of white ally board membersand how they will be held accountable to those standards.
  
• And finally, don’t be afraid to ask for help. This is challenging and very nuanced work. And it needs to happen now. If you want support in this, please reach out to me. I am here to help. You got this; I got you; together, we can make change. 

It’s time we call out the (white) elephants in the (board) room!

Notes:

*I specifically phrased this belief to read “have or can cultivate” the necessary skills to govern as opposed to just “have” the skills because there is bias in recruiting only for established expertise and not the ability to develop them. To start with, many of the skills NPO boards seek are from sectors that are historically white, like fundraising, law, and finance, so that means without specific recruiting criteria that prioritizes racial diversity, you are more likely to have multiple white fundraising professionals, white lawyers, and white CPAs on your board. Because of this dynamic, many white majority boards subconsciously believe there aren’t any BIPOC professionals out there and they need to “lower the qualifications bar” in order to bring on BIPOC board members. Stop that thinking in its tracks. It is flat out wrong and reeks of implicit bias.There are highly qualified BIPOC professionals out there. Just because you only have experience with white professionals speaks more to the history of the professions you are recruiting from. It also speaks to who is attracted to your organization…and who isn’t. Really examine your needs and intentionally recruit BIPOC who have the skills you need. For example, if you need HR experience, then recruit Black HR professionals. Or, consider what skills new board members can learn rather than only recruiting those who have accreditations (i.e. do you really need a CPA on a board in order to run a financial report?). Finally, consider what you are trading if you unwittingly prioritize skills like fundraising as equal to or in higher value than the experience of BIPOC in a racially biased society. Which understanding is teachable and which only comes with lived experience?

Header image: photo by Headway on Unsplash