Episode notes:

• Read Alexis de Tocqville’s Democracy in America

• Follow John Brothers on LinkedIn

• Check out the T. Rowe Price Foundation 

Full transcript:

This transcript was automatically generated.

In eighteen thirty one, the French philosopher Alexis de Tocqueville spent nine months touring the United States. He came to learn about the American prison system, but during his travels, he witnessed a rich portrait of American culture and civic life.

Upon returning to France, he published Democracy in America, a book that's still in circulation and spring new conversations nearly two centuries later.

Tocqueville's writing captured the potential and hope of American democracy while pointing out the risks of rugged individualism and the hypocrisy of a freedom loving nation that continued to embrace slavery.

The book was a mirror for America, a way for the country to see itself from a fresh angle.

That kind of perspective is rare and essential. It's those kinds of insights that give us a chance to understand how our actions line up with our intentions.

Right now, philanthropy as a whole could use that kind of self reflection.

Welcome to Impact Audio. I'm Sam Caplan, Vice President of Social Impact at Submittable.

Today, I sit down with John Brothers, president of the T. Rowe Price Foundation.

John is someone who's constantly holding the mirror up to philanthropy, asking whether our reflection matches what we hope to see. Part of that work is interrogating processes and structures that have become so entrenched, we've stopped noticing them. According to John, nonprofit boards are the perfect example. As the governing body for a nonprofit, a board of directors has the potential to be an incredibly democratic force.

With Tocqueville himself providing some inspiration.

Folks in the nonprofit sector, there are a number of them that love de Tocqueville, democracy in America. Right? And so part of de Tocqueville's writings, he talks about his time coming to America and being inspired by these associations that would happen. Right? And and what he was basically seeing is groups of people at the local level coming together on behalf of an issue that they cared about. And, again, he called those associations.

In my mind, they could just be community members coming together, but he could also just been seeing early iterations of boards. Right? And so for me, that is, at core, what boards should really be doing. It's groups of folks coming together on behalf of an issue that they really care about and then working that issue.

And so you can see that happening in the planning of a neighborhood block party, or you can see that in planning of a national walk on the mall. Right? Complicated or whatever, but it's people coming together on behalf of something. At core, again, that's what boards are.

So what's happened, though, is over the last two decades or more, but really starting we we see this professionalization happening in philanthropy, but we also have seen it in the nonprofit sector, and we call it the helping industry.

But you see these folks saying, boards need to look like this. Right? They need to have these committees.

They need to meet this often. They need to look like this. Right?

And and that group of folks has grown pretty substantially over the last twenty years to be a sub industry. Multi tens, if not hundreds of millions of dollars have been dedicated to this subsection of the sector dedicated towards governance to helping nonprofits be better at governance, quote, unquote, better at governance. But what's happened is that it's it's ultimately confused these organizations, and it's caused these organizations to grab the pamphlets from these groups and try to follow it to a tee.

But what you now have is a is a countryside of nonprofits that have board meetings that are completely boring. Strategy, which is really one of the places that boards can be really effective, is that, you know, if if strategy hits the boardroom, it's often dead on arrival. No one's having strategic discussions and board meetings anymore.

And what they end up doing is talking about bake sale items of everyday things and not really talking about the things that community members should be coming together and talking about. And so and that is in many respects, not all respects, but many respects that challenge, because of this helping industry. The last thing I'll say is I remember I was on a panel in the UK, and this panel was on the, you know, the the current and future space of governance.

And to my left was somebody who represented one of the leading law firms, in the UK, and they were saying governance needs to have this, this, or this. And then on the right was the leading, kind of intermediary representing good nonprofit form. And so, you know and I'm representing, you know, philanthropy maybe or I'm a expert in governance, quote, unquote, and I'm trying to and I'm talking about we're doing too much.

And you can imagine the law the the the lawyer said, no. No. No. No. We we we need more structure.

We've gotta watch you more. You know? And then the intermediator is like, well, no. No.

No. We've got here's all these programs we have. And what I said to them is that it's it benefits you to have all of that infrastructure. Right?

Because it helps your businesses have that. Right? It helps your industries have that. But at root level, if you really look at what borks need to have, they don't need all those things. Now they can decide whether they want them or not, but they don't need to have that. And and they're confused about what they need versus what they should have. And the big missed opportunity, every day in America, there are over twenty thousand board meetings.

It is the strongest force of democracy that we have showing itself every day in this country. Twenty thousand collections of individuals coming together on behalf of causes they believe in. It's inspiring.

But yet, we have them walking to a structure and a beat that they don't need to, and so they miss out on the true value of what they could be practicing. And that is a real shame. And so I think that has a lot to do with the professionalization, and we need to kinda peel that back and get back to basics and allow the promise of these twenty thousand every day to truly fully realize themselves.

Professionalization happens when corporate values and structures are imposed on nonprofits. It's often done with good intentions, or at least not bad ones, but it can put distance between the nonprofit and their community and undercut the organization's mission.

Part of the professionalization of not only governance, but also the professionalization of philanthropy and these types of areas is that they have largely kind of looked at their corporate peers. And I'm a I I proudly work for a company, Tyra Price, who I think is amazing.

But corporate governance is different than nonprofit governance.

Investing in communities as a philanthropist is different than investing in businesses as T. Rowe Price. Right? So but what's happened is we've come up with this kind of, like, well, corporate governance and nonprofit governance needs to look similar.

And that's a real loss. Right? Because, ultimately, they're they're different animals. Right? What we want you know?

So if I'm a CSR professional and I'm asked to look at community and those nonprofits and their organizations, the thing I would advise a c a CSR professional is to realize that corporate governance is different than community nonprofit governance. And that when you try to make them the same, what you end up doing is taking away some real opportunities on the nonprofit side.

And that the best thing that a CSR professional can do is to try to help, community based organizations design their local, governance structure around what the community wants and needs, right, and not try to look like us. Right?

But to look like what you think is really important for your for yourselves. But, also, the last thing I would say is, you know, we have a really we're proud of our work in getting T. Rowe Price, associates to be on boards. You know, whenever I have somebody from T. Rowe Price approach me and say, hey. I'm I'm about to serve on this board.

What I say to them is make sure that when you leave T. Rowe Price to to go and serve on that board, that you're going on that board and you're bringing some of the great skills that you have, but that you're also understanding that you're walking into a completely different organization that has completely different, road map for what they're supposed to do and that corporations and community organizations are different. And they're and what makes them different is really beautiful. Right? At the local level, what makes an organization different from a company is really amazing and vice versa.

There's a piece of advice nonprofits are used to hearing from corporate partners that their organizations should strive to run more like businesses. There's an inherent judgment in the advice that businesses are naturally more efficient and effective than nonprofits, which often isn't the case.

I would say number one, Tiro is a, you know, a well run business, but the things that Tiro is running is, again, much different than what a nonprofit is running. When folks say we want them to run like a business, they misunderstand kind of the you know, every organization should try to run well. Right? I know a lot of companies that don't run well.

Doesn't matter. Right? Like, we all wanna run well. That that's important. But, like, nonprofits can teach companies a lot.

Right? And so if I have a board member from Tiro that is walking into a a community that is really diverse, the board is really diverse, and they are seeing things at the ground level.

I want that associate to come back to T. Rowe and bring that here because nonprofits can teach companies about diversity in ways that we might struggle in. Right? There are things that the nonprofit community can share.

You know, I know that most folks that are sitting in management positions at companies didn't when they went to school, didn't learn about social issues. But you boy, are they required to understand social issues now because companies are asked to be that. Being on a nonprofit board can help with that. Right?

So there are things that are there, and I think we just need to understand the assets that each side has and what each side can bring to the table, but both sides wanna run effectively. It's not like one is more has better run than the other. I know a lot of nonprofits from a financial standpoint that make a dollar out of fifteen cents that a lot of companies could learn from.

Board meetings are notoriously boring.

Maybe that in itself should tell us something isn't right. Because bringing a set of people together to work for a cause they care about has the potential to be meaningful and inspiring, essentially the opposite of what board meetings stand for right now.

Now I used to go to three board meetings a week.

It was a it was a an exciting life that I was living, Sam.

Board meeting. In fact, I actually did like going to board meeting, so it wasn't a problem. But what I noticed is if I would take let's say it's a twelve member board, and I would say to that board I would take them individually and say, tell me what you do.

What is this organization about? What is its mission?

Most times, if I did that activity, every board member would describe the organization in a completely different way. Now there's positives to that, but there's also challenges to that. And so I do feel like the first thing that I would do, with the organizations is just say, who who is this organization to you and have that discussion across the organization? The second one is, you know, so so I think a lot of the the the things that I would have boards do is to to really get back to basics about why why they came here. Sam, the boards that you're on, they didn't recruit you to be on the on a committee and to talk about bake sale items. They recruited you because they you and you said yes to them because you were excited about that issue.

But what has likely happened and is that you walked into that organization and two meetings in, you can't you're you're you're not talking about those issues anymore. Right? It is not a thing that you that you're in contact with. But when you sit down and you talk to board members individually about what this organization is, they may all have different responses, but they're also all gonna tell you the reasons why they're there, what they want to do, what their hopes are.

And some of them are waiting on that board so that someday they can do that. And I think the the the first things that I would do for organizations that are interested in kind of redesigning their board is to really understand from the board members there, why did they join, why are they there, and what do they think this organization is about. If there's synergies between that, that that's great. If there's lots of differences between those answers, that also is gonna tell you some work that needs to be done.

That would be a first bucket of of work. I think the second thing is how do you ensure that the people on your board are connected and have proximity to that issue and that they are feeling it and representing that issue. That's really important. Right?

I I've seen boards that are doing really amazing things about environmental issues that are sometimes somewhat big, and the board members, you know, haven't been near that issue in years. That's a problem. Right? And so giving board members connection, proximity, understanding to the issues in a really big way is really important for them to serve as board members.

And quite honestly, oftentimes, board members are far away from the issues. And in fact, it was the reason they joined, but it's a long ways away from, why they joined and when they joined. So gotta get them back to that.

Truly shifting how boards operate isn't about coming up with a new structure to impose upon them. It's about approaching the process with curiosity and asking the right questions.

I think the thing that, you know, we here at Tiro have a a a really great capacity building program that works with nonprofits, and and we have been working on a an effort for now, I think it's in its fifth year, called rethinking governance. And, ultimately, within that that effort, we pull together executive directors and their board chairs, and they come into a, a multi month process to think through like, to tear away at all of the dogma that exists with governance. Right? So we basically say, okay. You only need this if you're designing your your board.

Based on that, you can design this any way that you want, and let's do that. But in order to do that, you have to tear away at the structure that currently exists. Right? So sometimes there just been you know, you've gone to board meetings.

You essentially white out the date of the last meeting, and you put on the new date. And you're kinda doing the same thing over and over and over again. And, hey. This is the March meeting.

We do this at the March meeting. Right? Like, and, ultimately, what you're try what we're trying to do is get organizations to tear away at the infrastructure that you're always doing and then rebuild it from scratch, right, and start to think through. Like, do I need this committee?

Right? What is this committee for? Yes. I have a fundraising committee, but now what's that's done is it's only made these folks fundraise while everyone else is just kinda watching from the side when we know that fundraising is a team sport, and everybody should be doing it. So how do you reconceptualize development when you break away the fundraising committee?

Right?

Or finance and audit, and what are they supposed to be, and do they need to be separate? Well, what does financial stewardship look like across a whole board? I'm gonna, Sam, do a really quick impersonation of a board meeting during the finance report. Board meeting starts, me and you are on the board.

Let's say I'm the treasurer and you're the chair. Hey, John, John. Tell us how we're doing financially. Hey.

We're doing good, Sam. Great. And then we move on. Is that good financial stewardship of a whole board?

No. And so how do you rebreak down finance and and audit to make that an a owned effort across all of the board members? Every board member should be a good financial steward for the organization.

And so I think some of this just goes into, like, what is the functions that we wanna operate as as this board? If we think it's important for us to be involved in the community, how do we operationalize that? How do we create a way to do that? What are the norms that go into that?

So really taking some design thinking and then building it up from there. And to be honest with you, you're gonna have some successes and you're gonna have some failures. You're you're gonna see some things that worked and see some things that didn't. Right?

Take your board meeting and go and meet somewhere else. Go and meet in community. Right? Like, start to tear away at those norms and rebuild them and make board meetings always changing based on getting better as compared to sitting in a in in kind of your your your slop of normal infrastructure and just going through the motions.

What I do know is this.

Board meetings are not exciting. They are not fund in most cases. Folks are not excited about joining boards or being on boards because they have become places that are far removed from talking about what the issues are. Right?

What for us, we I like to call this thing question zero. Question zero is what is the question that we should be talking about? Boards are not asking or talking about question zeros. They're going through these kind of infrastructure or ongoing motions that they always go through, and that is because they've set up an infrastructure often by professionals to go through the motions as compared to being good governors of the organization.

For John, the state of nonprofit boards represents a big missed opportunity. It's not just about the boards themselves. It's a larger question about how the nonprofit sector can fully realize its potential.

I mean, obviously, what I care about is how our local communities, especially communities that are, you know, what what folks might, you know, call disinvested or or or having challenges at the local level, I care about how those communities realize their best selves and really walk to their own self determinations and can kinda see a better horizon for themselves.

And when I look at that and I look at the power that they have, one of the greatest powers that organizations have is their ability to mobilize folks together to come together on behalf of that issue, and nowhere is that better seen at the at a board.

And so if you take a board largely right now and you look at what they're doing, they're not realizing their true power. Right?

Twelve people coming together on be you know, I'm just using twelve, but coming together on behalf of this issue is a powerful, powerful frame.

But if they're not realizing that frame, it's a loss for everybody. Right? And so for me, that's why I care about, you know, governance. Right? Like, I'm not you know, I won't probably be as excited about talking about committee structures and things like that, although I'm not opposed to groups wanting those. But what I what what really makes me excited is the the true power of what a fully realized collection of boards can do to a neighborhood, to a city, to a state. And then when they're unrealized, it's just missed opportunity.

It really is. And and I think we don't have the ability in this in this time of of of our lives to not try to realize the full potential of the of this work, and that and that starts at the board level in many instances.

For people who are on a board of directors or considering joining, it's important to understand what's most valuable about your presence and make sure that you don't lose sight of that as you step into the role.

I think it's really important that if you wanna serve on a board I think one of the great things about folk you know, I'll just use T. Rowe Price, of course. You know, we have really creative thinkers, really collaborative folks that when they're trying to tackle a a problem or an issue in their job, It's why we have them here. They're able to look at it and think about it in really creative in different ways.

What I have found is that oftentimes, those professionals, when they go to a nonprofit boardroom, often leave that creativity, leave that problem solving ability, leave that ability to look at a problem in a different way at the door. And in fact, that's why we need them there. And so if you are a CSR professional and you're gonna join a board, you're gonna advocate to join a board, what we're advocating for you no one is sitting in any, boardroom saying, I want this person from T Rowe to be on the board for their their audit committee abilities. I mean, maybe a couple of them, but but in large part, what we need them in that room for is their ability to think differently, their ability their collaborative ability, their design thinking ability, their ability to look at a problem and like a prison shifted and we need those skills, in the boardroom.

And so that is our you know, that's what we're advocating for when anyone joins a board, but definitely for for T. Rowe Price folks who are really skilled in so many areas, and we want them to bring those full skills to a board.

And when they do come to the board, the goal is change the way the board does that work. Right? Don't come back to Tiro and say, oh, this board is just kinda going through the motions. Reason we want you on that board is that you have the ability to kinda shape and shift that board to do some really amazing things. And then what we're hoping for is that you had a great experience, that you're tackling a problem, and that you're bringing that perspective back for us as a as an organization so that we therefore can be better, as a as a company. That would be true value. And so I would advocate for any CSR professional to to walk into governance work with that frame.

Leave it to John Brothers to turn a topic like nonprofit boards of directors and make it totally inspirational. I'm excited to see how his advocacy has an impact. In philanthropy, we often think a lot about how to get more. More resources, more support. But sometimes it's worth considering how we can unlock the untapped potential that already exists.

That's all for me today. Thanks for tuning in to Impact Audio, produced by your friends at Submittable.

Until next time.