Somehow, I got on the mailing list of the National Association of Nonprofit Organizations and Executives (NANOE). The brainchild of Jimmy LaRose, NANOE is part of the charity skeptics movement that I don’t often talk about. It’s a champion of the idea that the nonprofit sector should be largely replaced by a socially conscious version of the for profit sector.
The latest email I got from NANOE outlined LaRose’s vision for nonprofit board members. According to LaRose, ‘boardsmanship’ is not about governance, visioning, policy making, or volunteerism.((It’s also clearly not about gender-inclusivity.)) It’s about advice and accountability. Specifically, it’s about doing a weird handful of things:
Complying with IRS regulations. That seems reasonable, but remember that the board shouldn’t be governing or making policy. So, I’m not sure how they should make sure that the organization is complying with IRS regulations.
Supporting a strong CEO by hiring them, evaluating them, supporting their vision, and providing them with expert advice. NANOE believes that actual power should rest with the strong CEO. That is the person who should determine the course of the organization.
Attending three meetings each year, and approving the meeting agendas. And, of course, getting paid for those meetings. NANOE recommends a board of six people, getting paid $300 per hour for teleconference calls and $1,000 per day for in person meetings. Plus expenses. That means a one hour conference call would cost the organization $1,800. And a one day meeting would cost the organization $6,000 plus expenses!
Approving and amending by-laws. But, again, not making policy.
Choosing and reviewing independent financial and program audits. But, again, not making policy. And, since these are independent audits (and I’m an advocate for independent audits), this really means deciding who to pay for them.
And, according to NANOE, this group should include an entrepreneur (as the chair), a program expert (as the secretary), an accountant (as the treasurer), a lawyer, a communications expert, and a nonprofit expert.
Let’s be absolutely clear: this is not a board. This is a group of paid professionals supporting the executive director’s vision and providing advice for realizing that vision. These are consultants.
Now, I have nothing against consultants; I provide consulting services. But this is a recipe for disaster.
First, NANOE is suggesting abolishing any oversight for the executive director. Notice that no one who the nonprofit serves is on this board. No donors or volunteers are on this board. No members of the general public on this board. Only experts are on the board. And they are commissioned to support the executive. Since they are not empowered to set vision or policy, this severely limits their ability to serve as a check on a ‘strong CEO’.
Second, by suggesting that board members be paid, NANOE comes close to advocating for a conflict of interest. Let’s imagine for a moment that the organization’s donors are from a rare breed that won’t revolt at the idea of a conference call costing $1,800. Paying board members – especially at a generous rate like $300 per hour – creates a risk that board members will see service as an opportunity for self-enrichment.
Together, both of these ideas create an environment that will erode trust in the nonprofit sector. Donors, volunteers, and others are not going to accept the idea that an unsupervised CEO is using their donations to pay a crew of consultants. And they shouldn’t. Members of our communities should be able to trust that the organizations they support are using their gifts of time, talent, and treasure for the the greater good; not for personal gain.
There are bigger issues here, of course. NANOE isn’t just advocating for replacing your board with consultants. It’s advocating for remaking the nonprofit sector in the image of the for-profit one. And that’s a huge problem. But it’s a problem that starts here: with the idea that nonprofits should be about money over mission.