It’s no secret that fundraising is the biggest issue facing most not-for-profit organisations. For the arts and cultural sector, the Australian Institute of Company Directors’ 2015 Governance and Performance Study found that increasing private-sector income is the primary issue over the next 3-5 years.
Fundraising is at the heart of viability for any NFP – but few arts organisations in our experience have their directors and executive teams working in alignment, in a holistic and educated way.
There’s no shortage of fact and anecdote about problems between directors and staff when it comes to fundraising, but the good news is it’s not as hard as we imagine to overcome them and make a genuine difference.
Why there are disconnects between Directors and Staff?
Three recent reports that identify shortcomings in both fundraising practice and governance, highlight the communications failures between boards and staff that invariably hold organisations back.
These reports from the QUT Centre for Philanthropy & Non Profit Studies, Perpetual and the AICD are reassuring in one way because they show arts organisations are not alone – the problems plague all sectors. But they do demonstrate that we need get on the front foot and implement the solutions that will lead to a better fundraising future.
Lack of understanding vs lack of training
The QUT report, based on in-depth research with NFP boards, CEOs and Development Directors, showed that…
The #1 challenge for fundraisers was a lack of board understanding about fundraising. However, it also found that no board member respondent had received any fundraising training on joining the board.
Similarly, the Perpetual NFP Governance Survey sampled 1700 Australian NFP Directors and found that just 5% of them felt they had strong fundraising skills. So a major issue really is building board skills in the area of greatest need: fundraising.
Appreciating fundraising as a profession
Finally, an opinion piece by Daryl Kibble for the AICD entitled Good governance requires good fundraising goes some way to joining the dots between all the findings. Kibble says that in every sector, remaining financially viable is the most critical issue. He argues that NFP boards are failing to invest in a discipline that ensures their very existence – raising funds – because many lack an appreciation of fundraising as a profession, and says that directors should insist that fundraising take centre stage in the boardroom.
While most of us have experienced the day-to-day issues in organisational fundraising, seeing these systemic problems researched and articulated in these reports crystallises a way forward.
Fundraising: front of mind in the boardroom
If fundraising from private sector sources is central to an organisation’s viability, it must become a comfortable inclusion in the governance purview. To directly address this, boards need to recognise fundraising as a profession and the established body of knowledge and proven best practice. Boards are well-placed to include a fundraising skill-set at the table and they need to be open to hiring professional fundraising services (in the same way you seek professional advice in law and finance).
5 Key Actions
So what if you could make some simple changes to share clearer, achievable expectations and raise more money?
The AICD has offered some excellent ideas in the form of five key actions for boards:
- Ensure that at least one board member has a fundraising skill set.
- Train board members in fundraising strategy, best practice and skill development as part of the induction process.
- Develop a fundraising strategic plan that is adopted, supported and monitored by the board.
- Hire professional services in fundraising when required – it’s an investment in the capacity of your organisation.
- Invest in high-quality fundraising professionals in the areas of highest return.
That’s the board’s contribution to the solution. But CEOs and Development Directors also have a major role to play in board nomination, induction, training and resource development.
Until our board members are inducted into our organisation properly, until they have fundraising reference materials and are trained in fundraising processes, and until they know the most important indicators of a healthy pipeline and how to measure performance – well, there is no place for frustration about their lack of understanding.
And of course while an investment in fundraising success from your board is crucial, they are just one part of the equation. Becoming a successful fundraising organisation requires everyone, at every level, to work together for the greater good.
To find out more about how fundraising practice can be integrated into your governance framework and fuel your organisation’s growth please get in touch.