The Non-Profit Founder's Dilemma: 

Tempering Issues of Control and Ownership

 

 

By Mary E. Costello © July 2007

Independent Consultant

Grant Writing & Program Development

Creative Edge Consulting

www.CreativeEdgeConsulting.org

 

 

 

Having had the experience of founding an organization many moons ago, I deeply relate to the personal struggles of someone creating their “baby.”  In particular, we work tireless hours to develop a new human services program, and somehow or another we hope for assurances that it will remain “ours.”

 

This is one of the many examples that I will share with you that came about through learning from my own mistakes.  And, it is a topic I revisit with almost every new organization that contacts me.

 

To begin, many new leaders approach this venture with a for-profit intent.  I understand this, because I did too.  The reasons are not for money in most cases, but for the illusion of maintaining control.

 

First of all, I discourage anyone who is interested in doing non-profit work within the framework of a for-profit entity.  You are setting yourself up for problems on many levels, in particular, funding opportunities—or lack thereof. 

 

We won’t even touch the muddy complexities of adding a non-profit arm to a, usually, floundering for-profit business.  Not only do I personally find that unethical, but funders will see the impure motivations as well.  But, that is another article in itself.  Today, we will talk only about these issues in relationship to non-profit operations.

 

For now, let’s chat about the illusion of control and the counterproductive pursuit of “ownership.”

 

The first red flag for me when working with a new group is when I review their materials to find how personalized they are, speaking more to the background and personal opinions and experiences of the Founder and their family instead of the work they hope to do.  In such cases, it is also common that the Board is comprised of only a few people, including the Executive Director/Founder and typically other family members.

 

So, before we delve deeper into this, here are a couple rules of thumb that apply to all non-profit entities:

 

  1. No one OWNS a non-profit organization.  It should be established to continue regardless of who is serving as administrator.

 

  1. The Executive Director (ED) reports to the Board of Directors, who is the sole governing body of the organization.  While the ED may be present at Board meetings to provide information and updates on progress, they are NOT a member of the Board and carry no voting power.

 

  1. If the Founder wishes to sit on the Board, they should not be the ED or involved in day-to-day operations.

 

  1. There shouldn’t be any family members on the Board.  It reflects very poorly on your agency and suggests a Mom & Pop operation.  The only exception to this is if your entity is that of a private family foundation, which is very different in structure and purpose from the vast majority of people who contact me in hopes of establishing a tax-exempt organization.

 

  1. Your Board should have elected leaders of President, Vice-President, Treasurer and Secretary.  You also need to be certain that you have procedural guidelines for elections and terms, including the process for asking someone to leave if it becomes necessary to do so.

 

  1. The primary role of the Board of Directors is to adopt formal policy, support the ED in whatever way they can, and fundraising.  Other than their involvement in other special committees an organization may create, Board members should be active, but not involved in operating the organization on a daily basis.

 

  1. Your Board should be diverse and maintain a membership of, ideally, 10-12 members.  These folks should represent the community at-large, both in belief systems and professional offerings.  It should also reflect your constituency when possible, such as a person with a disability, formerly homeless person or victim of domestic violence, or a parent of the population group you support.

 

 

The most common reason why new leaders cringe at the thought of a creating a true Board of Directors is the belief that what they worked so hard to create can be taken away from them.  I won’t lie.  This is always a possibility when establishing a non-profit.  So, my advice is to choose (invite) your initial members wisely. 

 

In doing so, remember that the commitment of all involved should be to the mission of the organization, not to you personally.  Provided you are a competent leader and fulfill the responsibilities of the ED role with integrity and overall success, you have nothing to worry about.  And, this is determined by an established job description and other outcomes-based deliverables.  I’ll also add that I have seen many organizations where the ED SHOULD have been removed from the position, but wasn’t.  Generally speaking, Board members tend to treat Founders a bit differently than those they hired through traditional processes.

 

Still, it is all about relationships and communication.  While there are unscrupulous people in both private and non-profit industry, their ability to harm you will be dependent on your other members and the processes you have created within your organizational framework.  In my experience, the integrity of the governing body will take over and quickly remove the bad seed that can be so destructive to morale and productivity.  It is also another reason why having a larger Board serves you best as a Founder.

 

Beyond those issues, it is important for a Founder to be mindful of their true motivations.  In particular, I am referring to the difference between what they once wanted their program to become…and the possibilities that are presented by involving the talents and ideas of others.  Rarely do such contributions weaken the original program.  In fact, in my experience, the mission and programs expand to something better.

 

Yes, it may not “look” like the original framework.  It may alter direction as well.  But, the question becomes that of marketability and impact. With the input of others, is your program more innovative?  More far-reaching in scope of services?

 

Although there are many components of human service provision that we can “control,” much of it is outside our power as individuals.   We can do the work, the planning, and the networking, but we cannot control many of the outcomes.  The sooner we recognize this, the better.

 

The best leaders I have ever known place great value on the contributions and creativity of those around them.  No one is an expert in everything, nor is there ever “one way” to do anything.

 

Micromanagement and holding onto the reins of power with a white-knuckled grasp will only lead to stagnation.  Trusting in those around you to pull their weight and add to the innovation of your program will lead you to where you truly hope to go.  And, by extending a sense of “ownership” to all those involved, you will find people who are more energized, more devoted, and more creative than when you offer them a dark box in which to reside.

 

Trust.  Do your thing.  Do your job.  Be the leader they can’t be without…..and, serve others instead of yourself.

 

 

 

 

 

 

About the Author: Mary E. Costello holds a BA degree in Social Work from The Catholic University of America in Washington, DC.  She is a former Social Work Administrator who specialized in the management of complex human services programs and leading new projects creation.  Forming Creative Edge Consulting in February of 2005, she now is the “resident expert” on grant writing and non-profit program development issues on the Boys Project website, a sponsored project of the University of Alaska/Fairbanks.  She serves clients throughout the United States, including both community based programs and those of national scope.   Programmatic and grant related questions or inquiries regarding her professional line of services may be directed to MaryCostello@CreativeEdgeConsulting.org.  Mary will attempt to answer all general questions from the public but cannot guarantee a personal response, dependent on volume of requests at any given time. 

 

Disclaimer:  Any submitted email questions from readers implies unrestricted authorization to use and/or reprint the content for articles and spotlight email responses on the Boys Project website and in all Creative Edge materials unless this permission is specifically denied in writing prior to printing or publishing.  Anonymity will be provided when requested or otherwise appropriate. Content used from audience email questions or any other means through this process provides no financial compensation whatsoever to the respective audience member.