Nonprofits often select local business leaders to serve on their boards, but what makes for good governance in this realm is much different than for-profit businesses.
Making choices based on increasing profitability can be detrimental to a nonprofit, cautions Harvard Business School Professor F. Warren McFarlan, who educates business leaders around the world on nonprofit management.
Financial stability is at the core of a nonprofit, he said, but board members should be most concerned with the organization’s mission and how decisions impact the people it serves. In the end, the quality of a nonprofit’s work largely determines its sustainability.
– Wilma Norton, The Community Foundation of Tampa Bay