Governance as Leadership

Issue 126 - August 20, 2024

In This Issue:

• NEW BLOG: What is Your Board Role? What is Your Board Responsibility?​
• Ready to Board: CEO-Board Communication
• Nonprofit KPI's to Focus On For Efficiency and Growth

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Let’s make an assumption -- you are a policy governance board, the most common (at least in stated intention) and the most effective (when implemented well). Read on here.​

Ready to Board: CEO - Board Communication

In the face of unprecedented change and disruption, CEOs are actively engaging their boards to drive their growth agenda.

One important, genuine partner may be hiding in plain sight: the board of directors. But many CEOs fail to communicate with their board in a way that maximizes the value of that relationship.

Here is a brief summary from McKinsey. Read the post here.

At its best, the board serves as a proactive oversight and thought partner to the CEO and top management team, giving them the chance to stress-test, communicate, and discuss strategies that drive outperformance. Further, engaging the board the right way helps CEOs amplify their effectiveness.

CEOs who effectively communicate with the board…

…Build meaningful, collaborative relationships to fuel performance

…Make the board more knowledgeable by delivering by high-impact insights

…Communicate with radical transparency to move at the speed of change

Build meaningful, collaborative relationships to fuel performance

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According to our 2019 Global Board Survey only 30 percent of board members report that their processes―including sharing information and aligning on tasks and activities to achieve a collective goal―are effective. In addition, nearly half of executives surveyed say their board’s performance falls short. The best CEOs invest in their board relationships. They go beyond static, meeting-by-meeting cadences and instead seek opportunities to collaborate and harvest new ideas that spark innovation. They engage on a personal level, cultivating one-to-one relationships with meaningful interaction and engagement.

Make the board more knowledgeable by delivering high-impact insights.

The best leaders are continuous learners, and CEOs invest time and energy to ensure that their board is abreast of industry sentiment and trends affecting their business.

Only 33 percent of board members say they received a sufficient induction when they took on the job.

Communicate with radical transparency to move at the speed of change.

To mitigate fragmentation or misunderstanding, the best CEOs are radically transparent. They share good news fast and potential risks even faster.

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Nonprofit KPI's to Focus On For Efficiency and Growth

Tracking key performance indicators (KPIs) is critical to the long-term success of any organization. The sooner you determine the right KPIs to measure and track, the sooner you can understand the true efficiency and impact of your fundraising efforts.

Even more importantly, you can use the insights you derive from your KPIs to improve the efficiency of those initiatives on an ongoing basis, defining a data-informed strategy for long-term success.

Track these 6 KPIs for efficient growth. The specific metrics that will be most useful depend on your nonprofit’s unique goals and needs, but there are some KPIs that virtually every nonprofit may want to continually measure. Here are six of the most important:

1.Donor lifetime value (LTV) What it is: The total value a donor or segment of donors generates for the entire length of time they contribute to your nonprofit. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

2.Donor retention rate What it is: The percentage of donors who continue to give to your nonprofit year over year. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

3.Donor growth rate What it is: The change in the number of donors giving to your nonprofit over a period of time (such as year over year) in percentage terms. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

4.Revenue per donor What it is: An average of the amount of revenue each donor brings in. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

5.Donor acquisition cost (DAC) What it is: A measurement of how much it costs to acquire one donor. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

6.Conversion rate What it is: The percentage of targeted audience members who converted after being exposed to a fundraising initiative. [The full post from LinkedIn explains why it’s important, how to measure it and how to use it.]

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As summer winds down and we return to the routines of the fall, have you considered what training could make you a better board member or CEO? Check out our courses or hit reply if you'd like some direction on what options would be best for you.

Sincerely,

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