The Diversity Gap in the Nonprofit Sector

The lack of diversity at the highest levels of the country’s corporations has been a consistent topic of debate, thanks in part to a number of high-profile stories focused on the technology industry as well the results of the recent mid-term elections.

If there has been less focus on the nonprofit and foundation sectors, it is not because either is exempt from the problem. Recently, Battalia Winston analyzed the leadership teams of the largest foundations and nonprofits in the United States and found that they, too, suffer from homogeneity. We found, for instance, that while 42 percent of the organizations we surveyed are led by female executive directors, 87 percent of all executive directors or presidents were white, and that there was only minimal representation of African Americans (6 percent), Asian Americans (3 percent), and Hispanics (4 percent) in those positions.

Our findings, which were published in a white paper, The State of Diversity in Nonprofit and Foundation Leadership, are similar to those presented in a number of other studies. A 2015 study by Community Wealth Partners, for example, found that only 8 percent of nonprofit executive directors were people of color, while a 2013 study conducted by D5 found that 92 percent of foundation executive directors were white.

While one would think that nonprofits and foundations — particularly those that support underserved communities and minorities — would prioritize diversity within their own leadership ranks, but attracting and recruiting diverse talent is easier said than done, especially at the leadership level. If organizations are committed to sustained diversity at the top, their Boards and senior management teams need to continuously prioritize the cultivation of a talent pipeline of diverse high-potential candidates, both internally and externally.

For any number of reasons, building a pipeline of diverse talent can be particularly challenging for nonprofits and foundations. First, the talent pool of diverse candidates is still significantly smaller than the pool of white candidates. According to a 2016 study by Young Invincibles, racial disparities in rates of higher education attainment continue to widen: between 2007 and 2015, the gap between the share of white adults with postsecondary degrees and Latinos and African Americans with postsecondary degrees increased by 2.2 and 0.4 percentage points, respectively.

Second, while for-profit enterprises, especially those in the tech sector, are able to make large investments in diversity and inclusion initiatives and, of course, offer attractive salaries, nonprofits and foundations often lack the financial resources to do so. Without a concerted diversity and inclusion effort backed by a well-developed employer branding strategy, these organizations often struggle to attract and retain the diverse talent they need.

Fortunately, there are a number of best practices that nonprofits and foundations can implement that don’t require major financial investment and can help make them more attractive to diverse talent:

Prioritize diversity organization-wide. Nonprofits and foundations should aim to foster diversity across — and beyond — the organization, from staff, to vendors and suppliers, to the community organizations they partner with and support. Establish guidelines and monitor – i.e., a percentage of candidates for open job openings or Board seats should be diverse; a percentage of vendors or suppliers should be women- or minority-owned enterprises.

Create clear career paths. If an employee cannot see a clear career path within an organization or easily identify opportunities to advance, he or she is less likely to hang in for the long haul. Establishing professional development and inclusive leadership training programs can help diverse employees see an organization as a place to grow, not as a stepping-stone to something bigger and better. Mentorship programs can be low-cost way for organizations to proactively include diverse employees, who — especially in mostly white environments — are less likely to receive organic mentorship and networking opportunities internally than their white counterparts.

Proactively identify high-potential talent. As boomers retire in ever-larger numbers, not-for-profits have the opportunity to add diversity onto the tail end of the employee lifecycle. Leadership can use those transitions to engage in a succession-management process, asking soon-to-depart employees to sponsor and mentor potential leaders inside the organization, prepare them for promotion, and encourage diverse candidates to express their interest in moving up.

Foster a culture of inclusion. Organizations looking to attract and retain diverse talent need to create a culture that truly embraces diverse opinions, perspectives, and lifestyles. Fortunately, there are many ways to achieve that: creating diversity committees with representatives from all levels of the organization and making diversity goals a transparent part of an organization’s overall strategic plan are just two of them. Organizations can also offer flexible working schedules, make accommodations for religious holidays in different faith traditions, and adopt diversity-friendly dress codes.

Most for-profit companies have put out some type of diversity statement and have strategies in place to meet their goals. It’s time for nonprofits and foundations sectors to do the same and incorporate diversity into every aspect of their hiring practices, as opposed to just “talking” about it. Tiptoeing around the diversity conversation will never help your organization achieve its goals or keep it competitive in the twenty-first century economy.

Want to learn more? Download a copy of our white paper, The State of Diversity in Nonprofit and Foundation Leadership. And feel free to share your own tips and best practices in the comments section below.