Nonprofit boards often uphold outdated power structures, prioritizing elite control over true community accountability. In Reimagining Nonprofit Boards, a three-part series based on the NPQ webinar, “A New Framework for Boards,” Ananda Valenzuela challenges traditional governance models and offers a new vision for boards that empower rather than constrain. By shifting from power-hoarding to power-sharing, nonprofits can create governance structures that truly align with their missions.
Boards are notorious for expending tremendous amounts of time, energy, and resources of nonprofit leaders who are already stretched thin by the demands of the job. But this doesn’t have to be the norm.
A more liberatory future is possible, one in which nonprofit leaders and boards work together more equitably, effectively, and impactfully by reimagining the role of boards in the broader nonprofit governance ecosystem.
To get there, however, requires an understanding of how boards came to be. This includes grappling with the invisible systems of institutional oppression, built to hoard wealth and power, that laid the foundation for how many boards operate today.
This series will give you a clear-eyed picture of the past, and then offer a different model for effective nonprofit governance, providing some specific examples of current-day boards that are walking a better path. If we are to co-create a more liberatory future, we must find new ways of working together that can more effectively achieve our dreams.
Where Did Boards Come From?
A more liberatory future is possible, one in which nonprofit leaders and boards work together more equitably, effectively, and impactfully.
Historically in the United States, instead of expecting our government to create a healthy, equitable social safety net, much of that responsibility was outsourced to a beleaguered array of charities controlled by rich people with the power to decide who deserves to be saved. This has continued into the present day, where predominantly White, wealthy board members exercise their power over nonprofits struggling to solve huge societal problems. We need to dive briefly into the past in order to make sense of the unwritten rules limiting how modern-day boards operate.
In the 1500s, the Catholic Church and a handful of aristocrats controlled most of England’s wealth, which threatened King Henry VIII’s power. In turn, he created the Rule Against Perpetuities, which deemed that a person’s control over property must cease within 21 years of that person’s death. By forcing property to change hands, the king could tax it, limiting others’ consolidation of power.
Fast forward to the reign of Queen Elizabeth I in the 1590s, when she found herself with too many impoverished, suffering citizens. Instead of fundamentally changing the systems of wealth distribution, the queen’s solution was to enact the Statute of Charitable Uses, which incentivized the wealthy to make charitable donations, and lifted the Rule Against Perpetuities for those charitable donations, giving wealthy people the ability to control how their money was spent long after they had passed, all while avoiding paying taxes to the crown.
This tradition continues into the present day in the United States in the form of private foundations and restricted donations. While many civilizations across history have built structures to support community care, from mutual aid associations to community centers, the US legal structures shaping “charity” are rooted in English history, where community care has historically been outsourced to the wealthy rather than the government.
Predominantly White, wealthy board members exercise their power over nonprofits struggling to solve huge societal problems.
A key turning point in the US history of nonprofits was the case of The Trustees of Dartmouth College v. Woodward in 1819, when the New Hampshire state legislature tried to take control of Dartmouth College. In this case, the courts decided that Dartmouth was a private entity and should remain independent, which helped cement the concept of corporate personhood. This orientation shapes the “third sector” to this day, where nonprofits are seen as completely independent from, and barely accountable to, the government that is ostensibly in charge of providing a healthy social safety net to all its citizens.
In lieu of government accountability, the entity to which Dartmouth (and all nonprofits) are accountable is their board of directors. Those boards, meanwhile, are accountable to no one else and have few checks and balances on where and how they exercise their influence over nonprofits, relying primarily on self-accountability.
By 1900, businessmen dominated most US boards. Rich alumni who wanted more power over their universities used board service as the avenue to exert control and decision-making. In the words of BoardSource’s A History of Nonprofit Boards in the United States:
[I]t can be seen as an effort to create a new kind of public accountability—accountability not to the public as represented by government or by professional authority, but to the public as represented by the most economically successful.
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However, not everyone believed this was the right path forward.
Thorstein Bunde Veblen, Norwegian-American economist and sociologist, commented in 1918 that “these governing boards of businessmen commonly are quite useless to the university for any businesslike purpose….Their sole effectual function [was] to interfere with the academic management in matters that are not of the nature of business, and that lie outside their competence and outside the range of their habitual interest.”
In a full-circle moment, 70 years after Dartmouth helped cement in the power of charities, William Jewett Tucker, then president of Dartmouth, declared that there is “no greater mistake…than that of trying to make charity do the work of justice.”
Nonprofits in Modern Times
Nowadays, the term “nonprofit-industrial complex” (NPIC) is thrown around almost habitually, without necessarily pausing to understand the deeper meaning beyond that term. This concept was introduced to our sector by INCITE! Women of Color Against Violence in The Revolution Will Not Be Funded, which defined NPIC as “A system of relationships between the State, local or federal governments, the owning classes, foundations, and non-profit/NGO social service and social justice organizations that results in the surveillance, control, derailment, and everyday management of political movements.”
According to anti-oppression practitioners Both / And, “The NPIC shifts the focus to service delivery and away from root causes, such as poverty, racism, and exploitation. In doing so, philanthropy and the non-profit sector are able to promote ‘anti-racism’ while keeping the world safe for capitalism.”
There was a large uptick in nonprofits founded during the 1960s, inspired by activists pushing for a more progressive future. However, funders framed the core issue not as antipoverty or antiracism but rather as localized self-help.
The charitable sector has not changed significantly since Elizabethan times.
Claire Dunning, a political and urban historian, lays out a history of US nonprofits in the book Neighborhood Nonprofits that makes a compelling case that the continued prevalence of nonprofits reflects “the failure to create a more inclusive and responsive government, failure to adequately meet the needs of low-income residents, and failure to dismantle the racism of the city’s and nation’s political-economic structures.”
This decision to put power in the hands of the most economically successful results in unjust decision-making. As Professor Olúfẹ́mi O. Táíwò points out:
[T]he subgroup of people with power over and access to the resources that get used to describe, define, and create political realities—in other words, elites—are substantively different from the total set of people affected by the decisions they make. As the part of the group closest to power and resources, they are typically the part whose interests overlap with the total group’s the least. In the absence of the right kind of checks or constraints, they will capture the group’s values, forcing people to coordinate on a narrower social project than the group would if power were distributed differently. When elites run the show, the ‘group’s’ interests get whittled down to what they have in common with those at the top.
Or in the words of Anand Giridharadas, author of Winners Take All: The Elite Charade of Changing the World, “To question their supremacy is very simply to doubt the proposition that what is best for the world just so happens to be what the rich and powerful think it is.” And research shows us that the 1 percent do not have the same priorities as the general public, both when it comes to which nonprofits receive donations and which political issues should be addressed.
Despite perennial critiques of the status quo, the charitable sector has not changed significantly since Elizabethan times: The rich still control many boards and they generally impose their interests on the nonprofits they oversee.
This brings us to the present. Boards are still unequal and inequitable models of governance. Thankfully, there are groups that are challenging that model—and in the second article in this three-part series, we’ll explore what it means to imagine, actualize, and cultivate a different kind of board: a liberatory board that sees itself as part of a broader governance ecosystem and that partners with staff in a “power-with” stance, knowing that its core role is accountability, not decision-making.
