The contribution of a board member’s time is worth more than money
17 November 2021 at 5:11 pm
Recent research has stressed the importance of board participation in giving. But here Volunteering Australia CEO Mark Pearce shares an alternative view on the importance of prioritising skill over financial contributions from directors.
The topic of fundraising can be contentious, and many charities rely on donations to survive. The for-purpose sector is, by definition, committed to creating social change. Fundraising can be a key mechanism for enabling this change, but it is a vehicle not an outcome.
Recent research by Noble Ambition revealed only 15 per cent of charities have 100 per cent of their board members donating to their organisation. The authors urge board members to “put their money where their mouth is.” But is this really what we should be asking?
For most charities, board and committee members are overwhelmingly volunteers. The primary function of a board or committee is governance, and whilst this includes responsibility for oversight of fundraising activities (if applicable) this is only one duty that is part of a board’s broader remit.
Volunteer board directors give of their time, experience, and expertise to help charities meet their legal obligations and charitable purpose. Financial donations are not, and have never been, a prerequisite for being a board director. Suggesting donations from board directors should be prioritised risks confusing the purpose of a board, which is first and foremost to provide sound governance. It also may serve to undermine the inherent value of volunteering.
Being a board director requires expertise and a significant investment of time
For many charities, the contribution of volunteers is vastly more valuable than financial donations. Board directors bring a myriad of skills that a charity might not otherwise have access to. Whilst volunteering does have an economic value, what is far more important is the extent to which the contribution of time and expertise from board directors increases the capacity and capability of a charity to deliver on its vision and mission.
Donors care about impact
A recent study by Monash Business School found “non-economic motivations and personal values, rather than economics or efficiency, dominate donor thinking.” Based on this, it seems likely donors would be most interested in whether board directors are values-aligned and purpose-driven. Similarly, donors are deterred by misuse of funds, underscoring the critical role of good governance in charitable organisations.
Conflating fundraising and governance risks undermining diversity
Lack of diversity on boards is an enduring issue and we know there are systemic barriers to participation for people from minority groups. If financial donations become an expectation of board directors, this could further embed structural disadvantage and disincentivise people from considering director roles. And if boards exist, in large part, to advance a charity’s purpose, lack of diversity may directly impede the ability to adequately represent the interests of members and beneficiaries.
Serving as a charity board director is a privilege
Volunteering is an activity with immense economic, social, and cultural value and volunteer board directors play an integral role in helping Australian charities advance their mission. The time invested by board directors is an invaluable asset for charities, but volunteer board directors also derive a significant benefit from their participation. Board directors have a unique opportunity to have a direct and demonstrable impact on causes they care deeply about. As with all volunteering, the contribution of a director’s time is worthy of recognition and celebration in and of itself.