New Research Shows Benefits of Diversity on Nonprofit Boards 

New Research Shows Benefits of Diversity on Nonprofit Boards 

February 20, 2018 by Angela E. White, CFRE

Nonprofit boards that include a higher percentage of women tend to have board members who participate more in fundraising and advocacy. Members of these boards also tend to be more involved in the board’s work, new research released today shows. 

These findings are just two of a number of results from the study, The Impact of Diversity: Understanding How Nonprofit Board Diversity Affects Philanthropy, Leadership, and Board Engagement, which can help board members and nonprofits strengthen their boards through diversity. The research was conducted by the Indiana University Lilly Family School of Philanthropy at IUPUI in partnership with Johnson, Grossnickle and Associates and BoardSource. The Impact of Diversity DOWNLOAD.jpg

“As the U.S. population grows more diverse, nonprofit boards have an opportunity to engage members that reflect this diversity in their work,” said Una Osili, Ph.D., associate dean for research and international programs at the school. “Diverse board members have the capacity to improve the organization’s philanthropic engagement through increased board member participation, fundraising and advocacy.” 

The study examines the ways in which diversity is associated with board members’ engagement with the board. It also explores the relationship between a nonprofit’s characteristics—such as the age of the organization, level of revenue, and focus area (nonprofit subsector)—and the diversity of its board members, including their race, ethnicity, age, and gender. The report finds that both organizational characteristics and the diversity of the board affect levels of board engagement. 

Among the report’s key findings: 

  • Nonprofit boards with more women members are more involved, engage more in fundraising, and participate more in public policy advocacy. Their CEOs also rate these boards’ fundraising performance higher.
  • Boards with higher percentages of young members (age 39 or younger) have greater commitment and involvement and engage more in oversight and governance. This is also true of boards with higher percentages of women members.
  • Nonprofits founded before 1900 have less diverse boards than newer, smaller organizations. Nonprofits with higher revenues also tend to have less diverse boards.
  • Older organizations have significantly higher percentages of board members who meet with potential donors, ask others for money and contribute financial gifts. These boards also are more likely to be rated by their CEOs as being highly involved.
  • There is a relationship between a nonprofit’s subsector and board diversity. For example, nonprofits that focus on education tend to have higher percentages of African-American board members.
  • Boards of nonprofits with revenues of $5 million or greater are more likely to participate in advocacy. Their members are more likely to engage with policy makers, to provide them with information on policy activities and to monitor the impact of government policy.

“It is important to align your board composition with your organization’s mission, values, and priorities,” says Angela E. White, senior consultant and CEO of Johnson, Grossnickle and Associates. “Nonprofits should be careful to avoid seeking diversity just for the sake of diversity as this can lead to tokenism. However, if boards clearly define their priorities and foster a culture of continuous learning, greater diversity will lead to a more engaged board.” 

“The nonprofit sector has a great opportunity to lead by example on diversity and inclusion,” said Vernetta Walker, chief governance officer of BoardSource. “As a sector that focuses on the public good, inclusion of diverse individuals can deepen understanding of issues communities are facing and create the right environment for problem solving, in an authentic manner. Ultimately, this is about mission impact, which is the reason nonprofits exist.” 

The research is comprised of two phases. In the first, researchers conducted an empirical analysis of the data from BoardSource’s Leading with Intent: 2017 National Index of Nonprofit Board Practice, including nonprofit CEOs’ responses to the survey, combined with information from IRS Forms 990 and the school’s Million Dollar List of large gifts. The second phase employed case studies to delve more deeply into findings from the first phase. In addition to the results above, the study includes analyses about the linkages between additional organizational characteristics, measures of diversity, and overall engagement.  

Learn more by downloading the full report or by joining our webinar on Thursday, March 29th at Noon EST.

 

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