Demographics are Destiny? - Tori

Scholars of nonprofit board governance provide many interesting explanations on the interactions between boards and the environments that shape their behaviors. Citing Keeley’s (1978) social contract theory of organizations, Gazley, Kyung Chang, and Bingham point out that board behavior is influenced by their moral obligation to represent and reflect the constituencies they represent. [1] Resource Dependency theorists posit that because nonprofit organizations because can never be self-sufficient entities, organizations “can only persist if they can maintain an incoming flow of resources and secure the dependence of other organizations on them.” [2] Therefore, board members must act as boundary spanners to ensure that the board has adequate resources, to recruit and identify candidates for service on the board, and to promote the board’s public image. [3]

Because of this interdependence with the communities they represent, leaders of nonprofit organizations should pay careful attention to the shifting demographics of their communities. In his reconstruction of the 2003 bankruptcy of the San Antonio Symphony, Christopher Reddick offers some compelling evidence that ignoring changing demographics can lead to detrimental consequences for a nonprofit organization. According to Mike Greenberg, a San Antonio Express News reported interviewed by Reddick in his case study, one of the key factors that led to the symphony’s financial woes was a 1930’s business model that was not updated to account for changing demographic circumstances in the San Antonio region. For many years, the symphony relied on the donations of wealthy individuals and business donors whose contributions were driven to some extent by civic pride. Greenberg contends that a combination of suburban sprawl and the displacement of home-grown businesses by corporations with no ties to the local community diminished civic attachment to the symphony causing a precipitous drop in donations. [4]

While demographics may not be destiny, nonprofit leaders in Roanoke would be prudent to consider how demographic changes could impact their organizations.

Below are three demographic questions that nonprofit leaders in the Roanoke Region should examine:

1) How will lingering unemployment in the region impact revenue sources such as fundraising, membership dues, events, services, etc.?

2) What strategies are in place to engage the region’s growing Hispanic population?

3) How will the region’s aging demographics (fewer younger adults, more middle age and seniors) impact an organization’s ability to recruit new board members?

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[1] Beth Gazley, Won Kyung Chang, and Lisa Blomgren Bingham, “Board Diversity, Stakeholder Representation, and Collaborative Performance in Community Mediation Centers,” Public Administration Review, July/August 2010, p.611.

[2] Juan J. Fernandez, “Causes of Dissolution Among Spanish Nonprofit Associations,” Nonprofit and Voluntary Sector Quarterly, vol. 37, no. 1, March 2008, p. 117.

[3] Judith Miller-Millesen, “Understanding the Behavior of Nonprofit Boards of Directors: A Theory-Based Approach,” Nonprofit and Voluntary Sector Quarterly, vol. 32, no. 4, December 2003, p. 525.

[4] Christopher G. Reddick, “The Bankruptcy of the San Antonio Symphony: Background and Financial Statements,” The Electronic Hallway, 2005, p. 3.