Boards are under pressure to “step up” as federal and state cuts constrict the oxygen that nonprofits need to breathe. Urgency, however, doesn’t translate to action. Much like a parent wanting a child to move faster, an Executive Director can’t will a board into action.
When it comes to board action—especially on technical topics like finance, risk, and compliance—we often frame the problem in terms of what board members should do.
They should read the financials.
They should understand risk.
They should ask good questions, like about cash flow or policy changes that will impact our mission.
They should, and we get frustrated when they don’t.
During a Nonprofit Financial Commons webinar on April 29th, I shared five ideas on how to engage board members more deeply in finance conversations. These lessons are appropriate for any topic that board members might be reticent to engage with. You are welcome to download the slides and handout.
Let’s frame the challenge: 70% of the people on this webinar said that their organization’s finance leadership resided with executive staff. That means we have a lot of Executive Directors and staff-level finance leaders trying to get their boards to get up to speed.
Let’s frame the opportunity: Before I shared my five lessons, I asked participants to imagine they are a board member, and that it is that time in the board meeting when the treasurer begins to talk. You pull out your board packet and look for the document the treasurer seems to be referring to. There it is….
It has one of the most famous first lines in all of literature.
The document in front of you might as well be in a foreign language. A balance sheet might as well be in a foreign language for many board members. Compliance and risk-related topics too.
Our job is to be the translators and access guides for them. What an opportunity! Here are my five ideas on how to do that:
1. Meet people where they are
Prior knowledge drives future knowledge. What someone knows will determine what they can learn, remember, and use.
Researchers have studied the connection between experts and novices and have determined that experts are not fully aware of 70% of their own decisions and mental analysis of tasks… and therefore are unable to explain them.
We see this in the boardroom. Those with deep knowledge of finance talk about numbers without going into the connective tissue that holds these numbers together, like: context, how financial statements work together, historical trends, pet issues of board members, how restrictions work, and so much more.
| Tips: Know where your people are in their finance (or other) knowledge. Invest in nonprofit finance learning. Other topics too. Adopt a beginner’s mind to identify the 70% of information you aren’t telling them. |
2. Focus their attention on what matters
I recently wrote about saccades — how our eyes follow certain pathways. Saccades are rapid, involuntary eye movements that help the brain quickly scan and process visual information by directing the fovea—the eye’s area of sharpest vision—toward points of interest.
Our eyes follow pathways when we see a face. If you’ve ever ridden on a train, your eyes are drawn to the telephone poles you pass by—they are markers to look at.
We can help people know where to put their eyes.
In our finance training, for example, we teach people to look for four things on a balance sheet. We want to train board members to always look for these things as they build habits and confidence in their finance knowledge.
| Tip: Guide their eyes to what you want them to focus on. There’s an example of how to do this in the handout. |
3. Give them a chance to make meaning
Stories create meaning. They allow us to understand the world and ourselves better.
One of my favorite activities when I teach finance is our “Once upon a time” finance story activity. Using an income statement, I invite participants to settle into the numbers and tell a bedtime story to a child or friend. We often see ogres, dragons, princesses, talking frogs etc. in our story time. There is only one rule. Your story must be anchored in the numbers. If you say something is growing or doing badly or a moral problem, you must tell us how the numbers back that up.
Storytelling helps to explore three levels of understanding”
- Do they understand the numbers?
- Do they understand the business model “under the hood?”
- What myths or biases do they hold? Every good story ends with a conversation about overhead or pay equity, doesn’t it?
| Tip: Use storytelling to invite board members into conversations. Start with a financial statement or legal contract and ask what story it tells. Who is the protagonist? What is the setting? What is the problem, and what is the solution? |
4. Make it social
Adults learn best when they engage with others, sharing experiences, solving problems, and asking questions. Social learning deepens understanding and builds confidence.
Board conversations most often happen one to all. One person talks, everyone else listens.
How do we get more voices in the conversation? How do we hear from those who don’t feel as confident? How do we hear from those who are speaking this “language” for the first time?
| Tip: Use pairs and small groups to get more voices into conversation about whatever you want them focused on. Talk about scenarios, strategic questions, or my storytelling exercise. |
5. Tap into their emotions
“Emotions create habits. Not repetition. Not frequency. Not fairy dust. Emotions.”
BJ Fogg, author of Tiny Habits: The Small Changes That Change Everything
We all have a money story which holds emotional meaning for us. When I teach finance, I often hear about childhood poverty, money held in power over someone, or an experience stretching a paycheck to get to the end of the month. I also hear joyful stories… the power of earning your own funds, buying your first car, and that dollar bill taped upon the cash register in a new business.
I like to ask board members about their money story. I then like to ask what money story their mission needs from them now.
| Tips: Talk about board members’ money stories. Anchor in why something matters. Help each person know their role so they have an emotional connection to the outcome. |
To anchor these ideas in the research, learning transfer is how people take what they’ve learned and apply it in real-world situations. Transfer doesn’t happen automatically. It takes thoughtful design, practice, support, and a learning environment that makes application possible. You can find a helpful overview of learning transfer research compiled by Dr. Will Thalheimer here.
Instead of talking about what board members should be doing, let’s aim for motivation, namely moving board members to a place where they experience:
- Clarity (I understand it),
- Autonomy (I choose it),
- Relevance (It matters to me), and
- Confidence (I believe I can succeed).
For more at the intersection of adult learning and the social sector, read about how these issues relate to advocacy