A (Missed?) Philanthropic Opportunity in Nonprofit Leadership Development

Cultivating_nonprofit_leadership_CoverThe National Committee for Responsive Philanthropy (NCRP) released a new study expressing support for leadership development. As I read the report, I thought about Asia’s developing NGO and philanthropic sector and the severe lack of funding for leadership development. While this report focused on US organizations, the arguments and findings are incredibly relevant and I hope Asian donors also consider supporting leadership development in addition to tangible social programs.

The study Cultivating Nonprofit Leadership: A (Missed?) Philanthropic Opportunity makes the case that foundations should dedicate additional resources to fund and encourage the development of leaders in the nonprofit sector.

`“An analysis of grants from 2003-2013 showed that leadership development funding comprised just 0.9 percent of total dollars granted and 0.8 percent of total grants.” The for-profit sector invests $129 per employee per year for leadership development; the civic/social sector invests $29.

Leadership development, according to the study, is critical for the nonprofit sector because it encourages collaboration and creativity, reduces burnout, and helps build organizations. NCRP is advocating grantmakers increase their funding of leadership development, fully integrate leadership development into their overall program strategy, engage their grantees as full partners in building leadership, and help organizations build capacity to create a culture of leadership development.

NCRP’s focus on leadership development is part of a growing concern. The Center for Effective Philanthropy released a study last year indicating “73 percent of nonprofit leaders felt that they lacked sufficient resources and opportunities to develop their leadership skills.”

The report emphasizes that their focus is on leadership, not leaders as “leadership can emerge from any level of an organization.” Although not addressed in the NCRP report, investment in leadership needs to begin at a grassroots level, within every organization and with every employee. Professional development offers opportunities to connect with colleagues within, and outside of, specific fields, creating an environment that encourages collaboration and creativity that can enliven and strengthen an organization.

Foundations have expressed a reluctance to invest in an area where measurable results are few. However, the Evelyn and Walter Haas Jr. Fund’s Flexible Leadership Awards conducted a five-year evaluation where they found positive links between leadership development and organizational growth. The organizations participating in the program saw their budgets increased by an average of 64% over the five years. Although this does not demonstrate direct causation, this and other anecdotal accounts do indicate a positive benefit to organizations investing in leadership development.

NCRP advises grantmakers that investing in leadership development “is, in a sense, insurance on any grant that a foundation makes; it increases the probability of success or achieving outcomes. Put simply, it is in the best interest of every grantmaker to fund this work.”

The report is available at no charge online and NCRP encourages nonprofits to use the report in order to build the case to their funders to support leadership development.