Helping nonprofit executives diversify revenue & scale gen-ops dollars so they can invest in infrastructure and growth.
Nonprofit CEOs: Should you always have to ask your board before making an investment? That’s a common issue I run into .... that is, Executive Directors handcuffed by their budgets. Who better to get a thoughtful answer from than Mary Hiland Nonprofit Leadership Expert on my recent podcast. [This part of our conversation starts at about minute 16:21] “As an executive, your relationship with the board is really, really important. Board members, like everybody else, are going to have issues with money; everybody has a money thing. The more you know your board members, the more you understand about their personal perspectives and issues with money, the more you can craft agreements with the board proactively about what flexibility you have, as an executive. I do strongly recommend you need a spending policy. What is your spending authority, so you know you can spend up to X amount of money without having to come back to the board.” 🔥Mary also reinforced that just because you have a budget, and a plan, doesn’t mean that is set in stone. Each budget item might vary by up to 10%, and you want your board to fully understand that so no one “freaks out” if something does change. This is why regular assessments, ideally quarterly reviews, are so important for determining if the budget needs to be adapted to changing needs. Ultimately, there needs to be clarity between the ED and board members on discretionary spending. “I think you do need to know what you have discretion to spend. If you need more than you have discretion to spend, I do think a conversation with the board is important. But it needs to be tied to your goals to help them see [that spending] is necessary.” Such great wisdom, Mary!! And there’s much more… 📽 You can view this podcast on YouTube in its entirety. I’ll put the link to the video in the comments!
Rebecca Britt
5mo
Absolutely love this! Yes I’ve heard of nonprofit EDs asking if they can spend $35 on a course. Trust is a central point here. A board should provide oversight and should also trust their ED to make wise programmatic and operational decisions within clearly articulated policies. 👏👏
Stanley Block
5mo
Thanks for sharing. A healthy relationship with the board is crucial. Like anything in life, you got to make the investment in order to receive the returns.
So glad you shared this key point Sherry! You've created a great resource for nonprofit leaders - board members need to listen! Thanks!
Tony Martignetti
5mo
The discretionary spending limit is also an issue. I've heard of CEOs hamstrung by a $500 limit.
George Weiner
5mo
Thanks for sharing. It all starts with governance
Adam Norse
5mo
Communication and trust are key here.
Kiersten Hill
5mo
Having a clear procedures manual with the guide rails built in and spelled out is critical and can really be empowering for staff and board alike!
Greg Head
5mo
Excellent points! Understanding spending authority and having open communication with the board is crucial for nonprofit executives. 💡
TR Garland
5mo
Mary's insights on navigating budgets and board relationships are invaluable! 💡
Helping nonprofit executives diversify revenue & scale gen-ops dollars so they can invest in infrastructure and growth.
5moListen to the entire episode here: https://youtu.be/-9lMaXUD30w?si=PwG8SCHUNHNAbGur