Nonprofit Board Policy

[Mike Burns]

Today's Wall Street Journal article on corporate branding as a source of revenue for children's musuems introduces some great nonprofit board policy questions. Making policy to inform day-to-day decisions is part of a nonprofit board's fiduciary duty of care. Policy also reduces the need for a nonprofit's management to need board action on every single decision.

According to the article, corporate branding can play a significant role in the sustainability of a nonprofit. Children's museums offer particularly unique opportunities for corporations to "plant their seed" as you would for both the child and parent. But there are policy questions a board should consider ahead of taking advantage of these opportunitites.

The most simple question: is there any "tainted" money source a board would not accept? Usually tainted is derived from having a moral or political basis and may indeed counter the core values and mission of a nonprofit. I imaging that a board's clearness about its values should serve as a fine reference for deciding whether to accept money from some sources.

As sustainability is the root for accepting branding money, a board might establish a policy about just how dependent the organization should be on branding. Businesses tend to be fickle in their relationships; their bottom line income influences how long they may remain committed; and, sometimes they make decisions that result in not having an interest or desire in the relationship - like moving the factory to another state or country. I'm not saying that all businesses are unreliable but history might suggest...

Then there is the question of mission. Is the "what" a corporation want to brand compatible with the nonprofit's mission and program goals? The New Balance example in the article appears to be an example of consistency for the museum but I can imagine where such examples are otherwise.

So, a nonprofit board's policy work is complicated but can certainly make a difference for the nonprofit's future.