Should you let donors vote for board members?

Interesting discussion over at Tactical Philanthropy: Donors and Proxy Voting.

The question is whether it might not make sense to give donors the chance to vote for board members, much as stockholders do for corporations:

"... if donors were given voting rights, that they would be more engaged and likely to give more money over time."

I think it's a dynamite idea, even though the choice of board members is not likely to be very exciting to most donors. Really, on what basis would the average donor choose one board member over another?

Even so, I've never yet seen giving donors power of any kind not work. My guess is very few donors would exercise their proxy vote. But that they'd appreciate the chance, and that would lead to more giving, higher gift amounts, and better retention. That's what happens pretty much every time you show donors that you respect them.

Commentary at Tactical Philanthropy seems to be running against the idea, because of the assumption that given the chance, donors are going to do something stupid. Like elect a moron to the board. Or force the nonprofit to betray its own mission.

Worst-case scenario thinking always takes you to such bogus places.

If I ran a nonprofit, I'd look for every way possible to involve donors. I'd want more than their money. I'd want their ideas, their hearts, their thinking.

If you're afraid your donors are going to screw you, you're in trouble. While you're protecting yourself from your donors' predations, they'll be flocking to the smart organizations that respect them.

Technorati Tag: fundraising

Comments

[Jill Barnett]

In response to Sean's comment...I do not believe this is unique to my United Way. I think it is pretty standard but I've only worked at one local United Way so unfortunately I'm not certain. If it isn't standard--it should be. The Board of Directors are, ultimately, the group that controls the organization, and considering donors are funding the organization, it seems they have every right to choose those individuals.

[Aarti]

I work with Boards of NPO's in India. I think that the expectations that donors can make informed decisions about who should be on the Board of a non profit is a bit unrealistic.

Getting the right people on a Board is often a function of where the organisation is and more where it is headed , apart from who else is on the Board, what the expected role is, what the expected level of peer cohesiveness is etc etc- unless donors are completely keyed in into these aspects and involved as closely with the organisation so as to be able to know all of this, its unlikely that they will have all the information that they need to exercise a judgement on who should be a Board member and why.

I think that there are lost of other ways to engage donors and dont really see this as a 'wow' mechanism from an engagement perspective.

[Danielle Hamilton]

The issue of voting for board members in nonprofits completely depends on the nonprofit's bylaws that they've established. I've personally seen the results of a nonprofit who allowed all dues-paying members to vote, and the voting causing the entire board to be overturned and the mission to be scrapped, closing the nonprofit within 6 months. I've also heard of many organizations who allowed people to become members with their $5 donation the night of the vote, causing extreme havoc to the proceedings and to the board voting.

While voting members may work for some organizations, I can tell you it is NOT something I'd want to touch with a 10 foot pole. The idea of having to get a quorum to vote on specific actions, not just board members, is a logistical nightmare. Voting memberships may be fine for stockholders or larger nonprofits, but it certainly can cause extreme difficulties with smaller nonprofits.

Instead, I'd only want to be a part of a group that allowed "friends" and "memberships" which only entitle them to newsletters and special benefits, like behind the scenes tours or reception with the nonprofit president. This brings in the financial part of a membership, without the chaos of voting members.

For donors who want to take ownership, donating a specific amount to fund a specific program (within the scope of the nonprofit's mission) is an ideal way to encourage participation, aside from volunteering.

(NOTE: I've only worked with military and animal related nonprofits, so cannot speak as to how voting is done in other areas.)

Purrs and woofs,
~Danielle
www.humanefundraising.com

[jfundraiser]

Nonprofit organizations should hold annual meetings. And one of the activities at annual meetings is the election of the organization's officers. All "members" of the organization should be invited to the annual meeting (although most never go)and therefore have voting privileges.

If your by-laws specify annual meetings and how officers are elected, then hopefully you are complying.

Tech stuff aside, what a wonderful way to engage your donors -- offering them the opportunity to vote for your board officers.

[Sean Stannard-Stockton]

Jill, is this a unique practice to your United Way or common at others? I've never heard of it, but I am not terrible familiar with the United Way.

[jill barnett]

I work at a local United Way and our board members are voted in at our annual meeting. Obviously the members are nominated by a committee of current board members...but all donors at the mtg have the right to vote.