Nonprofit Boards Are Guardians of Precious Community Assets

As told by a nonprofit CEO somewhere in the US

I had a great conversation with the CEO of a nonprofit about managing through crises – as we all have been doing this past year. He talked about trust and honest communication. He listens to his board and communicates frequently and openly. He understands that boards ask hard questions because they are stewards of a precious community asset. But that also means they have to understand the clients they serve.

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Trust Is Key to Managing Through Crises

A little background. Our organization is over 70 years old with about 225 staff and a budget of about $17 million with most funding coming from federal, state, and local governments but augmented by private donations. The board is 18 people and is a fiduciary board. It is also a community-based board with many people who have had the lived experience of our clients. The organization started focusing on one geographic area and expanded geographically quite a bit before I came on. I had been CEO for three years when COVID hit. My predecessor had left suddenly, and the board had coalesced when they did the CEO search and hired me. In summer 2019, we redid our three-year strategic plan. We had a board retreat in the fall. The board and the senior staff got together. We really got at what we wanted to achieve. We narrowed done to five things to focus on.

Looking back to before COVID and before the protests, we were lucky that we did some things that positioned us well to withstand the challenges. We invested in IT infrastructure, we did antiracism training, and we got our finances in order. Some of this push came from me. Some came from a trusted board member.

Invest in Infrastructure Before It Falls Apart

While doing the strategic plan, my staff pushed to invest in them — in raises. I thought we needed to invest in infrastructure and especially in IT infrastructure. We had old equipment, old ways of doing things. It was fortuitous. We spent a ton of money between December 2019 and January 2020. We got everyone new laptops. We moved to the cloud; we added unified communication. When COVID hit and we had to work remotely, we were ready.

Train Your Board on Antiracism so They Understand Your Clients

At the same time, one thing I pressed my board for — and I was not taking no for an answer — is that the entire board go through Undoing Institutional Racism training. I wanted the two-day training. This was in 2019. My urgency was based on the people we serve and disparities we had internally with our management. So, I said, “Hey if you are going to be the board that makes a lot of decisions, you need to understand this. And you need to understand that there is a system of racism. We have made progress, but you have to understand what it looks like to our clients.” There was a lot of tension, a lot of fighting. Quite frankly the board did not want to do it. But we compromised. They would do the training, but they would do it in one day, not two days. So, we went to a hotel and we did our retreat one day and did the training the other day. We lost two board members over it. It was bridge too far for them. They did not show up for the training and they resigned. They were good board members too, good advocates, good donors. But it was not their jam. I believe you have to stick to your beliefs around this and let people who object go.
That was where we were — going into the fall 2019. We had just completed UIR training. We had a brand-new strategic plan. We were on our way to having what we thought was going to be a highly successful year. I was excited. My team was excited.

Get Finances in Order

Then December comes and a couple of things put a damper on everything. One concern was our biggest long-term donor, a foundation, which gives around $1.5 million per year had ended their giving. They said they would make a decision in December or January. We had tried to communicate with them several times and they had not responded. So, we are going into December uncertain if we were going to get this money. Then, there were some changes that the county had announced, and we did not know how it was going to affect our grants. Finally, the state decided not to fund a big program. So, suddenly we had a lot of anxiety about our financial future. It was a nerve-racking time. There was a mix of excitement and trepidation and anxiety.

Generally, we focus on development during January, February, and March. We have our signature fundraising event which raises a lot of money in March. We were getting sponsors, inviting guests, working on that hard core.
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Meanwhile, there is this COVID thing that is kind of lurking. Fortunately, I have a board member, who in December said, “Hey we may want to keep abreast of this thing that’s going on in China.” I am like, “OK. We’ll do that.” It started percolating in the news now and then. In January, the board member and I had another conversation, and he says, “I am worried about this COVID. I think we need to look at our financials.” So, we asked our bank for and got a line of credit for about $1 million. We also had a property that we had been procrastinating getting rid of. We put it on the market in January and sold it for a couple million dollars. In February, we shut down the programs the county and state had previously funded but were no longer viable for us to continue. The big donor renewed. A week before our event, end of February, we had our guests buttoned up, we had our sponsors. We were going to have the biggest event ever. We were sailing!

Then COVID took a life of its own. I had to make a tough decision. I cancelled the event. I chose to cancel. I did not postpone. I did not reschedule. I just cancelled. Then we decided to go virtual. This was before everyone knew what virtual was. We quickly put something together. Because we had done so much prework, we raised 80% of our goal.

When There Is Trust and Communication, Tough Decisions Are Easier

I give you that background to talk about how the board ties in. The relationship between the board and the CEO has to be strong and there has to be trust, communication, and support. When a trusted board member comes to me and says we need to look at something, I know he is saying this because he cares about the organization as a whole. The board supported me when I told them we were not going to have an event and that we were going to have this virtual thing instead. The honest communication between the board and me created trust and made the difference in how things proceeded after. We melded governance and operations better than I have ever seen in my career. We started communicating a lot more. The trust built over time. I knew they had my back, and I knew they were going to support me.

We never shut down. We made the decision that we were going to continue to operate as long as we could do so effectively. That was a decision we made together. Some of our staff could work remotely. Because of the nature of our services, some could not. We needed more communication and education to make sure the work could continue. We did this. We were getting into the swing of things.
Then George Floyd happens in May.

The board was at this place where they said, “Thank God we did that training.” It was not a struggle for us to put out a statement. Beyond the symbolic statement, taking action was especially important since a majority of the people we serve are people of color. One of our five goals in our strategic plan was DEI work so we were fortunate that we had already said this was a priority.  We had also developed tactics for the next three years. We established an office of Diversity, Equity, and Inclusion and hired a full time Director to help coordinate an approach that would move the agency along the continuum of being an anti-racist, multi-cultural organization.  

By this time, trust had been built based on all the other things that had happened. The board believed the organization had capable leadership. They also understood that I knew more about antiracism work than they did. We decided to step on the gas and push faster than the planned three years. The board understood the urgency to make a statement related to George Floyd and to create an equity statement for the agency.

We have managed well through the crises of the last year. We worked closely together to make sure we were on the same page. The board was informed all along the way. Frequently. At every step, the communication was honest. If there were negative things to say, I said them.

Great Minds Think Differently

​A lot of people say great minds think alike but I think the opposite. Great minds think differently. Everyone brings their great minds and thinking. That’s the synergy of a diverse board.

As a CEO, I see my board members as allies, partners, collaborators. I need people with different experiences and skills when they fill this role.

When thinking about all the distinct functions that boards have, the most salient is being a guardian. In the nonprofit community, we don’t have shareholders. We don’t have owners. We belong to the community. So, when I talk to my board about the future or about a problem or about a change, I remember that, ultimately, they are caretakers of a precious and necessary community asset. Some CEOs have an adversarial approach to their boards. But my mind set is that they are guardians of this asset and they are here to protect that asset on behalf of the community. They are here to ask hard questions and they deserve to have frequent, honest communication. They also need to understand our clients which is why I pushed for the training. My staff and I do the work, but they safeguard the asset.

 Lessons Learned

• Make investments in infrastructure before you need them.
• Train your board on antiracism and social justice so they understand what your clients are facing.
• Stick to your values and be willing to let board members walk away.
• Create a trusting relationship between the board and the CEO through honest and frequent communication.
• Have a diverse board to have different perspectives.
• Remember your board’s role is to protect a community asset.

“Editor’s note: Our community includes many exceptional leaders. From time to time, Valtas gives voice to them by including their commentary in our blog. We hope you enjoy them as much as we do!” ​​​​​

About the Author:
Janet Levinger, Social Impact Leader

​I want to create opportunity through engagement, advocacy, and philanthropy. I support and consult with organizations, boards, and people who live these issues. I advocate for systemic and structural changes. I connect people who can catalyze each other. I try not to tell experts how to do things when they know better. But I will share my expertise when it will help.

I have served on 17 boards over the past 25 years. I have been board chair of five of them.

More specific information on LinkedIn.
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I want to acknowledge that the land I am on was the land of the Coastal Salish people.

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