Separating Giving from Governance

Why the board that gives most may not be the board that governs best

I’ve seen the donor-board dynamic from three sides. I ran an orchestra in financial crisis, where every major donor had real leverage over what the institution could do next. I ran a presenting organization at a research university, where the governance structure was different and the room felt different because of it. And I spent years at a major national arts foundation, watching from the funder side as the same dynamic distorted the field we thought we were supporting.

Giving and governing have become so entangled in the arts sector that we’ve stopped seeing them as separate things. We treat them as one. And the predictable thing happens: power flows to the people who can write the largest checks. It shapes how organizations make decisions, who gets to make them, and what the institution is allowed to become.

Until we learn to see giving and governing as distinct, boards will keep governing in the shape of their fundraising obligations.

None of this can be restructured overnight. The financial dependencies are real. The give-or-get model is decades deep. Any organization that gets 40 or 50 percent of its contributed revenue from board members can’t unwind that in one fiscal year, or even three. Until another structure replaces that fundraising work, boards will keep doing it.

This is not an argument against major donors. Plenty of wealthy trustees are generous, serious, deeply committed to the institutions they serve. Some are the best board members I’ve worked with. But wealth alone doesn’t make someone best equipped to govern an arts organization, and we’ve built a sector that often acts like it does.

The idea has a long American history. Andrew Carnegie argued in 1889 that the millionaire was “a trustee for the poor,” administering wealth for the community better than the community could do for itself. We’ve quietly absorbed a watered-down version of that logic. Wealth starts to look like fitness to govern the institutions it supports.

Wealth is one form of capacity. Fundraising is a real governance responsibility. Neither is the same as judgment, or perspective, or community knowledge, or the willingness to ask the question the rest of the room is avoiding.

In the give-or-get model, a board seat comes with a price: write a meaningful check or raise the equivalent. The speed of that answer keeps the sector from examining what it produces.

When the price of a seat becomes the main thing that qualifies you for it, an unspoken hierarchy forms inside the board, and it has nothing to do with how well anyone governs. The trustee who gives one hundred thousand dollars a year carries more weight in the room than the trustee who gives five thousand, even when the second person has deeper expertise, sharper questions, or stronger community ties.

Nobody writes that hierarchy down. Every executive director in the country can describe it.

The sector has even built measurement systems around it: give-or-get totals, 100 percent board giving participation, board contribution as a share of budget. These numbers get reported to funders and benchmarked across the field as if they tell us how well a board governs.

They don’t. They tell us how well a board fundraises.

The same dynamic operates in hospitals and universities. A hospital donor who funds a wing carries informal influence over the institution’s priorities. A university donor who endows a chair shapes which fields the institution treats as central. The difference isn’t that these sectors have solved the problem. The difference is that scale lets them formalize a line between giving and authority that smaller institutions can’t afford to draw. A research hospital with a billion-dollar budget can decline a major donor’s preferences without risking the operation. A small clinic in the same hospital network can’t. The arts sector lives mostly at the second scale.

I was thirty-one when I became CEO of the Detroit Symphony Orchestra. Within two years, we were close to bankruptcy. The pressure I felt from major donors was rarely the kind you could point to in a single decision. It was structural.

You learn very quickly which board members can’t be disappointed. After a while, you can predict which trustees’ aesthetic preferences will shape what gets programmed, postponed, softened, or avoided. Some relationships hold up the budget, and you start treating them as almost untouchable in governance, often without ever naming it to yourself.

A smart leader navigates it. A less experienced one gets destroyed by it. Either way, the mission gets shaped by the checkbook, and the people inside the institution stop noticing because the shaping is constant.

For CEOs and board chairs, all of this becomes a daily problem you can’t set down. A serious share of your attention goes to keeping major donors happy in their governance role, separately from keeping them generous in their donor role. Those are two different jobs. You’re doing both at once, often with the same people, and the lines blur in ways that compromise both.

When the largest giver wants something the institution shouldn’t do, you’re not just managing a donor relationship. You’re managing a governance relationship that could weaken the rest of the board’s willingness to push back.

Carolina Performing Arts had a different structure, one most independent nonprofits can’t simply copy. CPA had an advisory board, not a governing board. The University of North Carolina at Chapel Hill was the legal entity. Fiduciary authority lived elsewhere, which meant the advisory board could focus on artistic perspective and audience knowledge, on institutional strategy and civic imagination, without carrying the full legal and fundraising burden of a nonprofit board.

I once had an advisory board chair who was a former chancellor of the university. His authority in the room came from institutional standing, judgment, and trust, not from giving capacity.

Most small and midsized arts nonprofits don’t have that luxury. Their governing board is the legal board. It must approve budgets, hire and evaluate the executive, protect the organization, raise money, and answer for the institution when things go wrong.

Even if smaller nonprofits can’t fully separate giving from governance, they can at least see the difference. Otherwise the give-or-get model becomes the unspoken logic of how the place runs.

Ask what the organization actually needs from its board before asking who can pay for the seat.

The board might need someone who understands the audiences the institution claims to serve and currently doesn’t reach. It might need someone with deep knowledge of artistic production, programming risk, or the specific community where the institution operates. It might need someone who knows what it’s like to be an artist trying to make a living in this country, because that perspective shapes a thousand decisions the board will make about commissions, fees, residencies, and partnerships.

The math gets sharper as the organization gets smaller. A donor who contributes $50,000 a year to a small arts organization can carry the kind of leverage only a multimillion-dollar donor would have at a major institution. The CEO can’t push back without risking the budget, the board can’t disagree without risking the relationship, and the donor never has to be heavy-handed. The numbers do the work.

From the funder side, the pattern was harder to see, which is part of how it survives. We didn’t sit on grantee boards. We didn’t vote on programming. The dependency did the work for us. Even when we tried to be careful, the power imbalance entered the room before we did. Organizations would pitch us projects that sounded like what they thought we wanted to hear rather than what they actually needed to do, and most of them were quite good at it. I sat through years of those meetings before I understood that our caution wasn’t enough to undo the structure we were embedded in.

The current model also creates a familiar class of trustee: the person invited onto the board without meeting the give-or-get. Everyone knows the type. Few say it out loud.

They’re welcomed in language and treated differently in practice. The exclusion isn’t always conscious. When most of a board’s authority comes from giving, a trustee whose authority comes from somewhere else gets weighted less, often without anyone deciding to do it. We’ve built two-tier boards inside what we call single-tier governance, and the people on the lower tier feel it. The line often tracks race, class, and professional status, which is one reason the language of inclusion can feel hollow to trustees invited into the room but not fully weighted inside it.

Boards would have to name what kind of judgment they actually need from trustees. Recruitment can’t keep flowing through the development office’s network. In the meeting itself, in real time, the executive director and the board chair have to defend the legitimacy of trustees whose contribution isn’t financial. The major givers who stay on would have to accept that theirs is one voice among many, not the voice the room defaults to.

Major donors also need forms of recognition that aren’t board service. Naming opportunities, donor circles, patrons’ societies, recognition events: all of these exist, but most are treated as add-ons to board membership rather than something that can stand on its own. For the donor whose social identity is bound up with being a trustee, a plaque or a dinner doesn’t replace what the board seat conferred.

Major donors are often most effectively cultivated by peers. Peer-to-peer fundraising at the major-gift level is one of the few mechanisms in this sector that reliably works, and it works because of social-class dynamics we don’t always like to discuss in panel rooms.

The board, among other things, is what makes that peer cultivation possible. If we change who sits on the governing board, we still have to figure out who does the asking, in a sector that has long run on pay-to-play status.

Most arts organizations need more contributed revenue, not less. So how do we ask for major giving without using governance authority as the lever?

One possibility is a parallel structure: a governance body chosen for judgment and lived knowledge, alongside a major-donor council with real social weight, real recognition, and bounded access to institutional leadership. The institution would have to be honest that the donor council is doing the cultivation work the board used to do. That work matters. It just doesn’t set the artistic direction. If it does, the institution hasn’t actually separated anything. It has only renamed the old arrangement.

Another possibility is a hybrid board, where some seats carry a giving expectation and others don’t, with both kinds of trustees treated as equal in governance. The danger is obvious: the hybrid model can reproduce the same hierarchy under a more inclusive label. Trustees without a giving expectation have to be visibly weighted in the room, and the board chair has to defend that weighting against the gravitational pull of the larger donors.

Neither model is complete. Both are more honest than pretending the current fusion is neutral, when giving capacity has no necessary connection to mission and still ends up shaping almost everything.

The next time your board fills a seat, ask what the organization needs from this trustee before asking what the trustee can give. When a major donor signals displeasure with an artistic decision, notice that you’re managing two relationships at once, and decide which one the institution most needs you to protect. Watch the next meeting. When a non-major-donor trustee speaks, see whether the room weights their voice the same as the donor sitting next to them. It usually doesn’t.

The board that governs best may not be the board that gives most. Until we sit with the discomfort of that idea, we’ll keep building donor clubs and calling them boards.