Nonprofits often point to their mission, their values, and their vision as the reasons for their existence. Under the purpose-driven board leadership (PDBL) model, these three characteristics set an organization’s purpose. We’ve written several posts on mission, including this one – The Mission Statement: Some New Thoughts. In an earlier post in this series, we examined vision. Here, we’ll focus on values.

Organizational values are fundamental beliefs and principles that serve to guide an organization in advancing its mission in pursuit of its vision. They guide the work and shape individual and group behaviors, decision-making, and culture.

Examples of Values

Many human rights organizations and other charities identify “dignity” as their fundamental core value. Ideally, their work and their decision-making should recognize the inherent worth of every human being and treat everyone in their internal and external communities with respect and observance of their inalienable rights.

Other common core values (some of which may be closely related to one another) include:

• equity
• respect
• compassion
• fairness
• integrity
• transparency
• accountability
• innovation
• collaboration/teamwork
• community empowerment
• education
• adaptability
• resilience
• courage
• safety

How is Governance Related to an Organization’s Values?

Good governance relies upon board members meeting their fiduciary duties to act in good faith with reasonable care in the best interests of the organization. For nonprofit board members, acting in the best interests of the organization is not merely about preserving institutional financial health or about maximizing outputs without concern about how that’s done. Organizational values are a critical component of how a nonprofit does its work, allocates its budget, and builds its relationships with its communities.

Without articulated values, an organization might:

• pursue efficiency at the expense of how it treats its employees and beneficiaries
• maximize services while ignoring equitable principles of who it serves
• accept funding inconsistent with its principles
• prioritize growth over community trust.

Values help shape the framework for fiduciary decision-making.

This is increasingly important in governance discussions involving:

• diversity, equity, and inclusion (DEI)
• employment and labor practices
• adoption of technology, including artificial intelligence
• data collection and management (including retention, destruction, and protection)
• individual safety considerations and strategies (beneficiaries, staff, volunteers)
• climate and environmental impacts
• political advocacy
• fundraising strategies
• board and leadership recruitment priorities
• collaborative efforts with 501(c)(4) organizations and for-profits
• organizational culture

Who Determines Organizational Values?

Traditionally, it seems like some combination of the board and staff are responsible for determining and articulating an organization’s values. But it’s important to understand that values are also shaped – sometimes powerfully – by the nonprofit’s history, donor and beneficiary expectations, applicable laws, sector norms and standards, and broader public expectations about how this type of nonprofit should be acting and behaving.

The board and staff responsible for adopting and articulating the organization’s values must recognize that they are not simply setting these values, they have a duty to identify those that they must observe in order to further the best interests of the organization.

Articulating Core Values

A nonprofit should not assume that its beneficiary, donor/funder, staff, and other communities trust the leadership to embrace the values they expect the nonprofit to have. Accordingly, the organization should publicly articulate the organization’s core values (assuming they are sincere).

It’s relatively common for nonprofits to have a statement of mission, vision, and values on its website. If the statement of values reads too generically, it may offer little assurance. But if the statement of values is articulated more powerfully than a list of a few words – perhaps through short examples of how values impact the organization’s work – then it may have a significant impact, including on:

• improving community credibility
• attracting and retaining donors
• convincing new funders and collaborators
• recruiting staff and board members
• building the organization’s reputation with regulators and politicians
• supporting organizational resilience
• differentiating the organization

From a governance perspective, including the core values in the organization’s bylaws or combining them into the legal purpose statement can make clear to the board that they are not to be ignored. This can also serve to counter an argument that the organization should not devote significant resources to advancing values if not directly in the purpose statement.

Recently, DEI (including its other articulations) is the value under the magnifying glass, increasing fear- or preservation-driven actions by more than a few nonprofits. Where DEI is strongly articulated by a nonprofit in its governing documents and public communications, it serves to encourage more courageous decision-making to advance that core value. There may need to be risk management considerations taken into account, but precisely how DEI is articulated as a value and guiding principle should help the board and staff recognize its relative weight in determining how to move forward.

Resources

The Role Core Values Play in Strategy Execution (Kate Gibson, Harvard Business School)