Should You Serve on a Nonprofit Board?

NEW STUDY: Nonprofit Board Service is a Pathway for Companies to Achieve Their Goals for Diversity, Innovation, & the U.N. Sustainable Development Goals

The Nonprofit Board Leadership Study, released last month by Korngold Consulting LLC, measures and documents the leadership development value of nonprofit board service for business people. Sponsored by American Express, The Dow Chemical Company, HP, Johnson Controls, PIMCO, and Symantec, the study provides insights for companies on the potential value of nonprofit board training and matching programs for advancing corporate goals.

The following summarizes the key findings of the study in a condensed version of the report, which will be useful to companies that either have programs and seek to expand or enhance them, or companies that are considering offering such programs.

Relevance. The results of this study are particularly compelling at a time when investors and the public express concerns about the failure of business leadership.  Investors and the public criticize corporate leaders who are not maximizing opportunities for innovation, economic development, and diversity and inclusion. They expect companies to be more accountable and responsible in addressing human rights, climate change, ecosystems loss, gender equity, poverty, education, and healthcare. Evidence shows that companies will profit and grow value by finding innovative solutions to global challenges. To make this a reality, companies need more effective pathways to develop leaders who can maximize business opportunities and potential.

Key findings. This study demonstrates that nonprofit board service is an effective pathway for companies to grow shareholder value in three ways:

  • Advancing workplace diversity and inclusion: Business people who serve on nonprofit boards gain appreciation and understanding of people from backgrounds that are different from their own. This benefits companies since studies indicate that diversity and inclusion increase profitability. Additionally, companies have a significant reservoir of people from diverse backgrounds who would like to serve on nonprofit boards, thus providing opportunities for leadership development.
  • Developing human capital for innovation: Business people who serve on nonprofit boards confront challenges that stimulate their leadership, creativity, and innovation. Additionally, they improve skills that enhance their performance at work, including strategic planning, decision-making, listening, collaborating, and partnerships. This experience and expertise will help their companies grow value.
  • Fostering economic development and achieving the U.N. Sustainable Development Goals (SDGs): Business people who serve on nonprofit boards strengthen communities where their company’s employees and customers live and work. Board engagement also helps to advance U.N. SDGs, including addressing hunger, good health and well-being, quality education, gender inequality, decent work and economic growth, reduced inequalities, sustainable cities and communities, climate action, and peace, justice, and strong institutions.

Meaningful. The level of satisfaction among those who serve on nonprofit boards is compelling. Nearly every respondent reported that the work of the nonprofit is meaningful to them (97%), that they are able to add value (95%), and that they would recommend nonprofit board service to their friends and colleagues (99.5%). The majority of respondents serve in leadership positions on their boards (81%), some serving on multiple boards and in multiple leadership positions.

The insights in this report about employee board service can inform companies seeking new and effective approaches to grow their value. Given the positive reception to board service by employees, it seems that increasing and enhancing board opportunities through company training and matching programs would be a win-win-win for companies, their employees, and communities.



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