Should board members be asked to make a minimum annual fund gift?
We are often asked about the wisdom in setting a minimum annual philanthropic gift for the members of the board of directors. Written into many descriptions of board roles and responsibilities is the requirement that a board member make a minimum annual gift of a certain amount, or more subtly, that they become a “member” of a specified recognition society.
Often the recognition society has multiple tiers of giving, but the minimal level is acceptable in satisfying the giving requirement. The amount set in the description is generally at a level that would not be uncomfortable for the board member with the least amount of personal resources.
The assumption made by the organization is that board members will understand their relative giving capacity vis-a-vis other board members, and make a gift commensurate with their financial capacity.
Unfortunately, board members rarely respond in that fashion.
A suggested minimum is more often interpreted as dues. The majority of board members write their checks for the suggested minimal level, with a just a few outliers giving more or less. There is rarely a correlation to the board member’s personal financial capability.
Nevertheless, we continue to see guidelines, which suggest this minimal amount in the hopes that members will understand the unstated expectation that they will contribute far more.
One of the most common questions asked by a savvy prospective trustee is, “What is the required giving amount?” A better answer than the suggested minimum amount is the following presentation:
Our board has a wide range of generous annual personal financial support from its members. We ask that each board member consider this organization to be one of his/her top three—four giving priorities, and make an annual gift commensurate with his/her personal financial resources. To help you understand the overall board giving we prepared a bar graph (see below) of individual annual board giving. The names are not listed; you will see that we have identified each board member as trustee A, B, C, etc. You will see that the average annual board gift is X amount. We ask that each board member try to give at or above the average gift and increase the gift each year.
We suggest that this approach be used each year when soliciting current board members.
Interestingly, we find that board members respond very positively to this approach. Given the competitive nature of our board leaders, most of them do not want to be in the lower quartiles, and as a result they will make a gift at or above the average.
Over time, this process results in ever-increasing individual board gifts.