By Jon Schmieder, CSEE
If you are a non-profit sports organization, at some point you have had to address the age-old question, “What level of contribution should be asked of our board members?” National Governing Bodies (NGBs), rights holders, sports commissions and the like all deal with this issue each year.
In the past few months, we have been inundated with requests for guidance on this very issue. Is it appropriate to mandate that everyone make a donation? Should there be a fixed amount for everyone? Should we ask the board to contribute at all? The answer is—it depends.
Every organization is different. Very few companies are exactly like the one down the street, and sports organizations are no different. While there is often a drive toward finding one best practice answer that applies to a question, in our industry this has its challenges.
There is a continuum of board member giving models. The board can give nothing, or there can be a mandatory donation at some level, or there could even be a “give or get” program in place. Below are several board giving models as well as the positives and negatives for each model.
- No board member contribution is required.
This model has no requirement for board member contributions to the non-profit. While this is the path of least resistance, this can also be quite problematic. Many foundations will not grant funds to a non-profit without 100 percent financial participation by the board each year. In addition, corporate sponsors might shy away from organizations whose board members don’t give to the non-profit. Board contributions show those outside of the organization that everyone involved internally has financial skin in the game.
- Board contribution is required at various levels.
This is known as the “ability to pay” donation model. Board members tied to larger companies (or who have deeper pockets) are expected to pay more than individuals who represent smaller companies or are retired. This model can work; however it can also lead to some slippage when the higher level contributors lower their donation amounts over time as they see others giving less.
- Board contribution is required at a fixed level.
This is where everyone pays one set amount, i.e., $1,000. Each board member is, thus, on equal (giving) footing. While this model often leads to 100 percent participation, it also unevenly taxes the board members that have less access to discretionary or corporate funds to allocate to the non-profit.
- Give or get.
This model allows board members to either make a straight cash contribution of some pre-determined amount, i.e., $5,000, or for the member to go out and raise the pre-determined amount. This can be done through fundraising activities or budget relieving value-in-kind donations. Many civic organizations use this model (such as bowl committees and PGA Tour sales clubs). However, in the NGB world, this model can be problematic. In the case where a board member commits to the “get” side of the equation and under performs, there is little recourse in the voting systems of many NGB bylaws to remove that individual from service. In addition, removal of a board member for non-performance under a “get” policy may not be a battle you wish to fight.
There is an age old governance model that says board members need to provide the organization with three Ws—wealth, wisdom and work. In today’s marketplace, where more non-profits operate like for-profit companies, board members need to bring all three Ws to the table for organizations to be successful.
Regardless of the giving model you employ, each board member should be expected to give their time and their resources (both personal and financial). The best, and most stable, boards have a frank discussion on this topic within the recruiting process. Your board orientation needs to address this topic head on to make sure that the board volunteer knows what the expectations are, and how they can fulfill them. Your organization is only as strong as its foundation, and your board members are the cornerstone of that structure. Put the building blocks in place in the beginning to form a strong base that can provide for a successful future.
Jon Schmieder is the founder of the Huddle Up Group LLC, a consortium of three sports-related companies led by award-winning executives. Schmieder has nearly 20 years of experience in leading non-profits and sports tourism organizations through strategic growth and increased community collaboration. Huddle Up Group clients include USA BMX, Detroit Sports Commission, Eugene Cascades & Coast Sports, Veteran Tickets Foundation, Arizona Football Coaches Association, Evansville Sports Corp., Travel Medford, Des Moines CVB, Las Cruces CVB, and the Association of Chief Executives of Sport (ACES), among others. The Huddle Up Group can be reached at Jon@HuddleUpGroup.com or 602.369.6955.