Five Principles for Supporting Nonprofits During a Leadership Change
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We are living in an era dubbed the “Great Resignation,” as millions of people worldwide are quitting their jobs and re-examining their priorities and values in the wake of the COVID-19 pandemic. In August alone, 4.3 million Americans resigned from their jobs. It’s not just one’s pay or role driving the trend, as Gallup research finds, but also employee disengagement and unsupportive workplace cultures. This is especially pronounced within the nonprofit sector, which has always struggled with high turnover rates.
Nonprofit executive directors and CEOs, especially those who come from marginalized backgrounds or identities, often feel isolated, unsupported and unappreciated—by their boards, their funders and sometimes their own constituents. The stress and burnout have been heightened and made more visible amid the pandemic, the economic uncertainty and racialized violence worldwide that have harmed communities and shaken organizational and personal stability. Some leaders are questioning the sustainability of their jobs in a culture where revenue is dependent on performative fundraising from opaque institutional funders and fickle individual donors.
Philanthropy has a critical role to play to turn this tide. How can funders ensure that leaders, organizations and movements are truly trusted and supported to achieve lasting social, racial, gender and political justice and equity, especially during critical periods of leadership transition?
This question has been a driving force behind the New Executives Fund at the Open Society Foundations, where we have worked with more than 130 nonprofit leadership transitions worldwide. For eight years, the New Executives Fund has supported new directors with a discretionary fund, offering them emotional space, resources, and a community of peers to imagine, workshop and implement their ideas for organizational and personal success.
As funders, we recognize the power and privilege we hold in this ecosystem often dominated by norms shaped by generations of wealthy, white men. Philanthropy is becoming increasingly aware of how it creates and exacerbates power imbalances. Some funders are taking action to shift power and agency to community, civil society and social movements through efforts like trust-based philanthropy, community-centric fundraising, participatory grantmaking and just transition for philanthropy.
Our recent report “In Support Of Those Who Take The Leap,” authored by organizational development practitioners Martha Farmelo and Victoria Wigodzky, offers a number of searing messages from the New Executives community of leaders to donors. The overwhelming takeaway is that global philanthropy has paid woefully insufficient attention to supporting leadership transitions in ways that strengthen organizations and their people. The onus is upon us within philanthropy to radically change our practices and to step up with increased funding, non-monetary support and trust during executive leadership transitions in ways that build power and increase equity.
Based on the feedback shared in this report, combined with our own experiences, we can distill the following five basic principles of supporting nonprofit leadership transitions:
Provide flexible funding specifically to support the transition. Among progressive funders, it is now conventional wisdom that multi-year general operating grants are necessary to support organizational resilience and impact. Periods of transition require additional flexible grants—beginning when the outgoing director starts considering their departure and continuing well after a new executive director has started. Many nonprofits need to do important internal organizational culture work to be ready for new leadership. These early resources enable staff and board leaders to strengthen personal and organizational capacities that are often not funded. Executive directors told us the flexible funding specifically earmarked for their transitions allowed them to “breathe or innovate” and engage in necessary projects that could otherwise have been hard to justify in a cash-strapped environment.
At minimum, don’t withdraw. The “wait and see” approach is unfortunately all too common and can be extremely damaging to new leaders and the stability of their organizations and movements. Leadership transitions are times to trust long-standing grantee partners and trust that those working in closest proximity to societal challenges know what’s best for their communities. If there are concerns about the organization or its board, make those clear and provide funds to implement solutions. At the very least, don’t cut off funding in an executive director’s first two years—this has the effect of blaming new leadership for the failings of the past, and can actively hurt the new leader’s chance of success and destabilize entire movements and fields.
Early recognition of new leadership amplifies their impact. Funders can use their influence to champion new leadership by elevating and celebrating them. A number of surveyed executive directors noted that the visibility of the NEF award in their first years boosted their legitimacy in front of their boards and staff, as well as donors, media, government officials, and their peers. The award’s “vote of confidence” lifted a number of executive directors’ self-confidence during moments of self-doubt and helped combat feelings of “imposter syndrome.”
Give special attention to leaders from marginalized communities. It’s critical to center race, gender and other aspects of equity in this effort. Funders must intentionally and thoughtfully support new leaders who come from backgrounds or communities that were previously excluded from leadership. This includes leaders of color, women, trans and gender nonconforming leaders, youth, those with disabilities, from religious minorities, and those without educational, occupational or wealth privilege. Recent nonprofit trends show that many white nonprofit leaders are stepping down in favor of leaders of color or other marginalized backgrounds in the U.S. and around the world. Yet, often these new leaders find the deck stacked against them as they contend with philanthropic structures steeped in white and elite privilege that systematically underfunds and undervalues leaders of color. Thoughtful progressive funders can help break this cycle by doubling down on their support of such leaders and vouching for them among their networks of peer funders.
Enable emotional support. Financial support is necessary, but not sufficient. Organizations and leadership in transition need emotional support, psychological safety and empathy. Funders need to offer opportunities for new leaders and their teams to make mistakes, learn and grow. This includes access to peer communities, which are essential for leaders to imagine, workshop and implement big and small ideas for organizational, movement and personal success. Donors should also be explicit about the different non-monetary ways in which they are prepared to support organizations in transition so grantee partners and boards are not left guessing.
While a number of progressive funders can and do go far beyond these principles, these are our baseline recommendations if funders truly want to support organizations and movements and their leadership to thrive through executive transitions.
Bipasha Ray is the former project director of the New Executives Fund at the Open Society Foundations.
