Achieving the Organization’s Purposes or Pursing Funding: Sometimes an Internal Conflict of Interest

We are all aware of how difficult it is to receive foundation funding today.

The economic climate has become more and more challenging and the number of non-profit organizations seeking support has increased. Simultaneously foundations have more limited funds to distribute and have focused their interest in specific areas. Often a “request for proposals” (RFP) is released, and it is aimed at attracting organizations that are providing or can provide specific services to particular client populations.

The need for funding will sometimes motivate the director and/or the resource development professional to pursue support for their organization and at times stretch beyond the stated mission of the organization. The attraction of the funding has the potential to distract the organization from fulfilling its core mission, and it may decide to expand its function by following the “source of the dollar.” This decision can be rationalized under the heading of providing more services to meet the emerging needs into the community.

The key issue is whether the organization is compromising its purposes by trying to secure funding for additional programs that are beyond its present mission. Several questions have to be asked before a decision is made. In stretching to receive funding what is being compromised in the core services that are provided to its clients and/or members? Who has to approve the decision to seek such resources and is there an understanding of the implications for the organization and the present constellation of services?

Often the professionals involved in providing for the agency’s financial stability will apply for potential funding even when it means stretching the agency’s ability to provide services to the community. Of course, it does not mean that this decision, in and of itself, is a negative one, however, it does need to be processed with the relevant leadership in the organization. The lay leaders and the appropriate committees should be involved in reviewing the proposal for expanding services and depending on the by-laws of the organization it might even require approval by the board of directors.

The lay leadership plays a very important oversight role for the organization and sometimes the best decision is not to pursue the prospect of receiving a grant from a foundation. It is very difficult to turn down funding at any time and more so during these very tense times. At the same time there is the agency’s integrity and it’s focus on what it does best in serving the community, in general, and its clients, in particular.

This is an instance when less is more for several reasons. The organization is making a clear statement about what it does and what it does best. The professional and lay leadership are reinforcing the agency’s mission and are making a value statement that will resonate with their donors and supporters. Demonstrating transparency is not only an issue of revealing the organization’s receipts and disbursements but also is reflected in what services the agency decides to provide and what services it does not offer to the community. A strong statement is made when the non-profit decides to limit it focus and not to be everything to everyone.

This dilemma is not limited to the issue of foundation funding alone and agencies may confront the same conflict when it comes to applying for funding from government agencies or when accepting a designated donation to support a particular client population or provide a specific service. In these cases the non-profit has to make a difficult decision and forgo much needed additional funds because it is not in the organization’s best interest to expand in new directions. These are complicated policy issues, and committed and informed lay and professional leaders need to be prepared to engage in the process to reach the correct decisions.

When the board of directors and the professional staff are aligned with each other in their understanding of the agency’s mission and how to best implement the mission then a clear message is communicated to donors, clients and the community. Having attained this level of functioning enables the organization to reach out to potential sources of funding with one voice and a clear focus. Such a message instills a sense of confidence and attracts supporters instead of raising questions about there being a lack of direction and raising questions about the integrity of the organization’s mission. Sometimes it is better to pass up responding to an “RFP” and to work harder at doing what the agency does best.

Stephen G. Donshik, D.S.W., is a lecturer at Hebrew University’s International Leadership and Philanthropy Program and has a consulting firm focused on strengthening non-profit organizations and their leadership for tomorrow. Stephen is a regular contributor to eJewish Philanthropy.