Nonprofit Board Members and Supporting Investors Share Common Roles

Comparisons can be made between a company’s startup phase and how a nonprofit organization expands on its mission. I’ve talked to many nonprofit executive directors (EDs) who say they wish their board members were more involved. Nonprofit board members attend the meetings, review the numbers and have input on future growth, but seldom get elbow deep in running the day-to-day operations.

The difference, of course between these for profit and nonprofit roles is that investors are motivated by the company profit, which will increase their monetary gains as investors; where a nonprofit board member’s main goal is to support the organizational mission. However, both the investor and nonprofit board member’s objectives can be met by increasing their level of support.

I think if more nonprofit board members were to approach supporting the mission like investors supports a startup, then EDs would find the organizational output increase significantly.

According to David Amis and Howard Stevenson in the chapter on The Five Participant Roles in Winning Angels: The 7 Fundamental Roles of Early Stage Investing, an investor can take on many supporting roles for a startup company including being a silent investor, helping tap into a reserve force of contacts, being an active team member, a coach, a controlling investor or a lead investor.

If you compare some of the roles that Amis an Stevenson outline on page 253 with the roles an ED expects from a board member, you’ll see many comparisons. Many of these services are outlined on page 253 related to how an investor acting as an advisor or virtual CEO can help. However, aren’t nonprofit board members supposed to be advisors?

The National Council of Nonprofits says, Board members are the fiduciaries who steer the organization towards a sustainable future by adopting sound, ethical, and legal governance and financial management policies, as well as by making sure the nonprofit has adequate resources to advance its mission.

Another Board Effect article called the 10 Duties of Board Members describes some of these services. Below is a comparison of what Amis and Stevenson highlight as the”value Events” on page 44, and what’s listed in the Board Effects nonprofit board member’s Top 10 Duties; side by side. There not identical, but there are many cross-overs related to helping oversee the operational and fiduciary responsibilities.

Invesor (Advisor/Virtual CEO Nonprofit Board Member Responsibilities
Strategic Strategic Planning
Organizational Hire and Set Compensation for CEO/Executive Director
Marketing Fundraising is a Duty of Every Board Member, and PR Advocates
Financial Legal and Fiduciary Responsibilities
Operational Governance is an Important Part of the Board Member’s Responsibility
Production Helping Advance Mission
Creating Foundation for Growth Governance and Board Development

3 Replies to “Nonprofit Board Members and Supporting Investors Share Common Roles”

  1. Hi Jill,
    You are so right about the support role of nonprofit board members. It is tough to get them as engaged as we need them to be. During my work at the chamber this was very apparent. The board members were important people in the community and it would have been easy for them to reach out to their connections and get items for our events or sell tickets to them. I know they are busy but the connections they offer are part of the benefit of them. In a for profit I suppose that the money invested helps keep them engaged.

  2. Great post Jill! Yes I agree, board members of non-profits and investors essentially have the same responsibilities. Forward thinking, liabilities, expansion, and sustainability are all primary factors. I have seen some boards include policies that numerous ways members can actively engage to fulfill their role. The accountability is built in the structure of the non-profit. Are there ways that the non-profits you engage with can amend the structure to actively engage board members?

  3. Great job with your post. Getting the support that you desire can be hard to come by as a new business owner. Thanks for the helpful information.

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