Each edition of this newsletter contains a section I call "What Works."
This month I want to talk about the link between your accounting system and board fundraising.
When most organizations design their accounting system,
board fundraising isn't at the front of their mind.
Yet, your accounting will drive how financial information is
presented to the board and that, in turn, can impact board fundraising.
One of the keys to board fundraising is accountability. The board needs to be accountable to each
other at the individual level. Many
well-functioning organizations take this step by providing each board member a
yearly update of how they did, and the board chair is used to deliver that news
and prod poorly performing board members to do better.
But beyond individual accountability, you need collective accountability - the board should have an overall goal (the sum of individual
goals) and it needs to be held accountable for meeting it.
There is no better way to create this ethic of
accountability than to embed the numbers into the financial statements -
something you'll be showing your board repeatedly over the course of the year.
That means the budget you draft should include a specific overall
goal for board gifts/fundraisings and the board should have its attention drawn
to that number and specifically discuss if it's appropriate as part of adopting
the budget. By voting on it
collectively, and creating a team pressure to reach the overall goal, you
There are, of course, many other ways your budget and accounting
system creates feedback loops that influence your success as an
organization. If your organization needs
an outsider to look at your budget and accounting system to advise you on
potential changes that would match up with your strategic goals, give me a call.