By Josephine Victoria Yam, J.D., LLM.
2018 November 29
At a conference last week, I met the Board Chair of a nonprofit organization dedicated to children diagnosed with chronic medical illnesses.
During our chat, she asked: "Can our nonprofit avail of B3’s free board matching services to recruit diverse board members?" “Certainly," I responded, "and what type of diversity is your board looking for?”
All types of diversity, but especially age diversity” she admitted. “Can you imagine that our nonprofit serves children? And yet, none of our board members is below 60 years old!”
And there’s the rub. Hers is a comment we hear many times.
A nonprofit board is the collective brain trust of every nonprofit. It should be comprised of individuals who bring the whole spectrum of perspectives of the beneficiaries that the nonprofit serves. Otherwise, how will board decisions respond to the needs of beneficiaries if their voices are absent in the board room?
And yet, a vast number of nonprofit boards fail to reflect the rich diversity of perspectives of the beneficiaries they serve.
This diversity gap is a wasted opportunity.
Enter the 2018 Boardsource study entitled "The Impact of Diversity". The study surveyed nonprofit CEOs and Board Chairs on the question: "How is board diversity impacting your board's engagement?". The study measured board engagement in three ways: board member engagement, fundraising engagement, and advocacy engagement. Here are some interesting highlights from the study.
Nonprofit boards with higher ratios of women have members who are more engaged, committed and involved. These board members actively take part in community building and outreach. They are engaged in oversight and governance of the nonprofit. And they serve on the nonprofit until the end of their term limits.
Nonprofit boards with higher ratios of women tirelessly fundraise for the nonprofit. These board members go out and meet with potential donors. They are not shy to ask others for money. And they are present in the nonprofit's fundraising events.
Nonprofit boards with higher ratios of women vigorously advocate for their nonprofits' causes. They reach out to policymakers. They keep an eye on regulatory landscape that may impact the nonprofit. And they inform policymakers on their nonprofits' advocacy activities.
What is it about board diversity that creates these positive outcomes?
Two words: Collaborative tension.
A diverse board representing a plethora of rich perspectives and mental models creates opportunities for “collaborative tension”, which is crucial for good governance.
Explained global firm Russell Reynolds Associates in its "Different Is Better: Why Diversity Matters in the Boardroom" report:
“In a room where everyone has different points of view and there is a greater opportunity for cross-pollination of ideas, there are fewer unspoken assumptions, less “group think” and a greater likelihood of innovation. This allows the board to ask the probing questions and tackle the challenging issues… which are at the center of good corporate governance.”
Diversity strengthens leadership. By casting a wider net in your board recruitment to incorporate the diversity and breadth of perspectives, your board becomes stronger and smarter.
As former U.S. President Woodrow Wilson candidly admitted:
“I not only use all the brains that I have but all that I can borrow”.