Articles and News

Mahtomedi, MN—If you’ve decided to accept a position on a non-profit board for your own business reasons you have an obligation to the organization, to the clients the organization serves, and to your business to serve faithfully and well.

Financials.  A board has every right and obligation to ask for the organization’s financials in order to accomplish its fiduciary and legal responsibilities. Whether or not you are involved directly in fiscal committee work, as a board member, you need the financials of the charity. Ask questions you likely ask regarding your own business. Is the entity operating in the black? How is income being generated? How are expenses being controlled? As a business owner, you are interested in profit generation. Profit is NOT the objective of a non-profit. Instead, the objective is likely to be service delivery.

The appropriate financial question is whether stakeholders are seeing the high percentage of the organization’s financial resources flow to programs and services, rather than to staffing and fund raising. A charity with longevity is better able to impact a community over time, so established non-profits do often include reserves and competitive salaries for management, but the key question is whether monies donated for a cause are primarily providing the outcomes the donors wish to see.

As a board member, paying attention to the organization’s use of dollars is also in your own best interest as a business person. When the community sees the positive outcomes of fundraising activities for the local hospital, local children’s services, local animal shelters, or local seniors, and when you are successfully connected to those outcomes as a publically involved board member, you have the benefit of good will and of associated editorial copy, including potential photographs, which help you stay top of mind in your community. (Again, there are many reasons to be involved in community boards, but if your reason is business driven, then being mindful of business outcomes makes sense.)

Your name is a valuable asset to you, and it can be a valuable asset to the non-profit. Just as you wish to protect your good name in the community by thinking through your events, marketing them well, and taking necessary steps to make them successful, you have every reason to expect that the non-profit will do the same with your name. Give it only to those non-profits that use donor funds to achieve measurable success in a realistic and timely way. If you are considering the local branch of a national organization, check at a site such as www.charitynavigator.org to see how the organization compares with like organizations in terms of direct service to clients, comparable overhead, and more. Just as you judge the quality of product provided by a vendor on which you will put your business name when you package it to leave your store, judge the quality of the experience provided by the nonprofit to its stakeholders. Your name will be on that package as well.

Policies. For hands-on business owners, such as independent jewelers, a real challenge in working with a non-profit is to remember that the board as a whole, not as individual members, set policy and that the executive director, if there is one, is responsible for the day-to-day operations regarding how the non-profit implements those policies set by the board. Policies provide the parameters in which day-to-day decisions are made. If you find your staff always coming to you for decisions you believe you wish they’d take responsibility for, you may hold your policy framework too close in your business life for your staff to use. Successful boards handle policy a different way.

Many well intentioned small business owners find themselves suddenly at loggerheads with non-profit staff members when the business owner serving on a board expects to pick up the phone or send a text expressing a desire to something specific done, when the executive director has to manage staff time and available funds ideally already budgeted. The frustrated board member forgets that he or she is one member of a board which holds policy responsibility – not a sole person responsible for decisions -- and that the executive director’s responsibility is to the board, not to the individual board member.

Independent jewelers can strengthen their own business skills by understanding why policy statements matter. For the non-profit, when the board’s policy is to always have two adults present when a child or vulnerable adult is involved, the issue is the safety of the client, the security of the volunteer adult who might accused of harming the client, and the very existence of the organization which might be consumed by legal costs or dried up donations when a client is harmed. For a jewelry business, when your policy is to always have two people in the store, issue is the safety of staff and customers, the security of your merchandise, and potentially your business’ viability. In both situations, the policy set creates the parameter in which daily decisions are made. For the non-profit, a policy of always having two adults present clarifies that paying a second staffer is necessarily, not just ideal if there is “enough” money, or else that an activity be cancelled.

Board politics. Each board member serves on a board for personal reasons. To some degree, each board member likely supports the purpose of the organization. Personal agendas, however, also factor in, and consequently no non-profit board is free of board politics. Just as you may have some business benefit as one of your reasons for serving, another person may also have their business benefit in mind. If both of you want the same high profile position, you may find yourself at odds. In other circumstances, you may find a board member who is invested in retaining old ways of doing things because of a history of family involvement with the organization.

Good board work requires good negotiation skills, and one of those skills is listening well to other board members so that you understand their motivations. When you can successfully dovetail your needs and theirs, adjusting timelines, finding ways to honor the purposes or wishes of other board members while making sure your own purposes are met, the outcome is an effective non-profit which succeeds at helping its intended client population and your community.

There are real differences in operating a jewelry store and in serving on a non-profit board. In both settings, however, financial information and related questions paired with clear policy statements can help you be the business and community leader you want to be. Thanks for stepping up to community service.

Charlotte Preston Catalysts Inc. provides business leadership consultation and services for independent jewelers, facilitates targeted business peer groups for jewelers, and develops the educational content and programs for multiple industry associations. Charlotte also is an active board member of many nonprofit organizations, both civic and in the jewelry industry. She is the recipient of the national Women’s Jewelry Association Award for Excellence in Special Services. Contact her at (651) 653-3919, getsitdone@aol.com, or log onto http://www.charlottepreston.com.