Illustration of writing an article on a laptop

ASU Lodestar Center Blog

How boards can lead nonprofits to financial success

person wearing suit and cape with money flying around

One of the most underutilized and misunderstood donor bases for nonprofit organizations is their board of directors. A board of directors is extremely important to a nonprofit organization’s governance, ethics, decision making, financial oversight, mission, and policy. As part of their financial oversight, financial giving should be at the top of their priority list.

There are many reasons why individuals are inspired to serve on a nonprofit board, getting to what that motivation is and cultivating financial support is extremely essential to a fiscally healthy nonprofit. Without the board of directors being financial stakeholders in the nonprofit organization, there is a group of individuals who are dedicated to the work that the nonprofit does without showing so financially. There are three ways that nonprofit boards can lead nonprofits to financial success.

Board member buy-in

Board member buy-in is essentially the way in which they can show they are true stakeholders in the organization. If they do not believe financially in the nonprofit, why should others who are not serving the nonprofit? By showing good faith in the organization and how it performs financially through a personal gift, the board member shows that the mission is worthwhile to the community. If a board member publicly gives to the nonprofit it serves, it can influence their friends and family to want to support the mission as well. In many grant applications, it additionally will ask if a nonprofit has 100% board participation in giving. This is asked to show if the board members truly believe and support the mission.

Board members as development officers

Many nonprofit organizations do not have the resources or funding to have a variety of development individuals on their staff. Many times, the President or Executive Director of the nonprofit is helping with resource development. Other times, it is a Director of Development and potentially one other staff member. With the board of directors acting as Development Officers, the nonprofit is able to solicit and bring in more dollars to the nonprofit while saving money on fundraising expenditures.

Board members must be appropriately trained

While having a board of directors is essential to the day-to-day function of a nonprofit, it is essential that they completely understand their role and what is expected of them. If board members do not know what is expected of them, the nonprofit may miss out on a donation because that expectation wasn’t clear. When board members understand their role clearly, they are able to focus on ways in which they know they can help bring in their own personal dollars or connections they have in the community. If the board members do not fully understand how to ask for donations or what exactly donor dollars go to, they cannot successfully be advocates out in the community and help to raise additional funds.

With the above combination - board members can help to bring in additional dollars for a nonprofit agency as well as become a major part of a nonprofit’s annual fundraising strategy. When considering how essential new donors are to the life of a nonprofit organization, especially a small nonprofit, board members can be used to close the gap in funding streams as well as in times of financial hardship. Without the support of the board members in financial endeavors, a nonprofit organization misses out on a significant amount of funding.

Olivia Barhorst is 2022 graduate of the Masters of Nonprofit Leadership and Management program at Arizona State University and a member of the Nu Lambda Mu Nonprofit Honor SocietyOlivia currently resides in Denton, TX, and is the Director of Marketing and Development for Denton County Friends of the Family ( She has worked in the nonprofit sector for over eight years and has a passion for fundraising as well as board and organizational development.

Learn more with training for your organization

Effective, motivated boards are critical to a nonprofit organization’s ability to develop its capacity and achieve its mission. Board Governance Training consists of a series of topics that break down the best practices and responsibilities of an effective governing body. It's available in-person, virtually or hybrid, depending on your organization and needs.

The Service Enterprise Initiative is a national program that provides training and certification to nonprofits that are committed to implementing exemplary volunteer management practices to achieve operational efficiency and greater social impact.

Illustration by Lillian Finley, ASU Lodestar Center.

Olivia Barhorst Headshot


ASU Lodestar Center Blog