Board Engagement: What’s the Norm?
Editor’s Note: CEOs and Executive Directors often express concern that their Boards are not fully engaged. Even the most active, professional Boards typically have one or two members who may be fully supportive of the organization, but do not demonstrate that commitment.
- Forty percent of all Boards have between 11 and 20 members.
- Sixty percent require Board members to make a financial contribution to the organization. The smallest organizations were least likely to make this requirement.
- Ninety percent of organizations that require a contribution report that they tell a prospective Board member about that expectation at the time of recruitment.
- Only 35% set a minimum gift amount for Board contributions.
- The average annual Board gift is just under $5,000. Education organizations report the highest average gift at $12,520.
- Only 11% of responding organizations in the religion subsector reported a minimum gift amount, but their average gift is not lower than averages in most other subsectors.
- Sixty percent of organizations track the amount Board members help raise.
- Board members are most likely to get involved by allowing use of their names (79%), asking friends or associates to attend events (78%), and making personal introductions (76%).
- Only 52% of Board members will host events in their home or business.
- Board members are least likely to develop the fundraising plan – 52% do, and rate prospective donors – 42% do.
- More households gave: in 2013, 98.4% of high net worth households donated to charity, an increase over the 95.4% who gave in 2011. This is also the highest rate of high net worth participation in charitable giving since the Study’s inception in 2006. According to The Center on Philanthropy Panel Study in 2009 by Indiana University, 65% of the U.S. general population donate to charity.
- These households gave more: the average amount given by wealthy donors increased 28% from 2011 to 2013: from $53,519 to $68,580 respectively. Average giving as a percentage of household income decreased by 1% however, as increases in income levels slightly outpaced increases in giving levels among high net worth households.
- Time is also treasure: these high net worth households also demonstrated their commitment to charitable causes through volunteering. Seventy-five percent of the respondents volunteered with at least one nonprofit organization; 59% of them gave more than 100 hours and 34% served more than 200 hours. Volunteering is also tied to giving: wealthy donors who volunteered gave 73% more on average than those who did not ($76,572 compared to $44,137).
- These households plan to give as much or more in the future: 85% of high net worth donors plan to give as much (50% of respondents) or more (35% of respondents) in the next three to five years than they have in the past. This is up from 76% who said they planned to give as much (52%) or more (24%) when surveyed in 2012. Why the plans to increase their giving? The top reasons cited are “increased financial capacity” (85%) and the “perceived need of the nonprofits or causes” they support (48%).
- Believing their gift can make a difference – 74%
- Personal satisfaction – 73%
- Supporting the same causes annually – 66%
- Giving back to the community – 63%
- Serving on a nonprofit organization’s Board or volunteering – 62%
- Solicitations were too frequent/was asked for an inappropriate amount – 42%
- Changed philanthropic focus/decided to support other causes – 35%
- Organization was not effective – 18%
- Organizational change in leadership or activities – 16%
- Respondents who rated themselves as “expert” in terms of charitable giving (14%) gave a significantly higher amount in 2013 ($150,229) than those who described themselves as “knowledgeable” (72% / $64,599) or “novice” (14% / $19,013)
- Fifty-three percent monitored or evaluated the impact of their charitable giving. Those who do so give a much higher amount ($104,625) than those who do not ($28,543)
- Seventy-three percent of wealthy donors reported achieving personal fulfillment through charitable giving. Those who report personal fulfillment donated more than five times the amount of those who were not fulfilled (approximately $80,500 compared to $15,100)
- Ask and you shall receive: A direct request from an organization to volunteer inspired the highest proportion of volunteerism (50%) in contrast to when high net worth individuals initiated the volunteer opportunity (17.5%). This is a direct reversal of 2011 trends, in which more high net worth individuals reported volunteering through their own initiative (42.8%) as opposed to being asked (30.7%).
- And the winner is: education. While many of the nonprofit subsectors benefitted from increased contributions from high net worth donors in 2013, education was the clear frontrunner.
o Eighty-five percent of high net worth households gave to education
o Education also received the largest share of dollars (27%) – more than religious causes (12.2%), environmental
causes (5.4%), basic needs (3.3%) or the arts (3.5%).
o The highest share of high net worth households also prioritized education as the most important current policy issue (56%) ahead of poverty (34.6%) and healthcare (33.8%).
- New research: giving pledge participation. Introduced by Warren Buffett and Bill and Melinda Gates, “The Giving Pledge” is a commitment by a group of individuals and families dedicated to giving at least half of their wealth to philanthropy. At the time of the Study, there were 127 households in 13 countries – 108 supporters in the U.S. – as signed supporters. High net worth households were asked about their hypothetical response if asked to participate in a similar pledge.
o Would not participate – 65%
o Don’t know – 22.4%
o Would participate – 12.7 %