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Private schools and non-profits: the struggle to balance growth, governance, and core values
As the media continues to highlight disparities between affluent and underfunded schools in Australia, our nation's wealthiest educational institutions often find themselves in the spotlight. While critical media attention given to private schools tends to outweigh that of its public counterparts, this spotlight can uncover some of the difficult challenges these schools face.
For example, like many non-profits that begin with a clear vision and set of values, the challenges associated with sustained growth (and the wealth that comes with it) can be particularly difficult to overcome in a school setting.
This is often due to the nuances of operating in the sector, such as:
- managing large endowments
- addressing heightened scrutiny from stakeholders
- balancing mission-driven goals with financial growth
Immature governance structures also commonly play a role, with little attention paid to these at the institution’s inception. Sadly, this lack of foresight can go on to have the opposite effect, where eventual desperation for a remedy leads to actions that do not align with core values.
So how does a large private school, or any non-profit that has significantly expanded, achieve that important balance between governance, growth, and adherence to core values?
The growth dilemma
As with any business, it takes a lot of passion and commitment to get a non-profit off the ground. What’s different about a non-profit though, is that growth and wealth are not typically primary goals. This means that the structures or systems usually in place to support them may be absent, with the majority of attention going to the immediate provision of services to support a cause.
When the vision and efforts of the founding team are rewarded with burgeoning interest from the community and an influx of funding, cracks start to appear. Adhoc processes are implemented to meet demand. Rapid hiring leads to employing people who do not align with the vision or values. And passionate views from donors may start to sway the types of services provided and how they are delivered.
As the board’s frustration grows, the focus inevitably turns to governance. A CEO with strong business skills may be appointed to help steer the ship, but if they are also not aligned with the original vision and values then further deviation will occur.
What results is a downward spiral of finger-pointing and avoidance, with toxic relationships spilling over into the workplace – and eventually the broader community.
Steering towards sustainable growth
There is no easy solution to restoring sustainable and harmonious growth within a non-profit where disintegrating situations have been ignored or covered up for some time.
In an ideal world, these circumstances may be prevented at the inception of a non-profit by giving appropriate attention to:
- a clear vision, mission, and values
- a well-considered constitution
- practical and detailed bi-laws
- the appointment of a well-rounded board
- effective and scalable structure and systems
The inclusion of skilled external advisers early on in the journey can also be highly beneficial. As an objective sounding board, they can help the organisation avoid common pitfalls and remain on track with the founding mission – regardless of who comes or goes over the years.
For established non-profits that have struggled with governance, growth, financial management, or culture for many years, all is not lost. From culture reviews to mediation, operational audits, and strategic overhauls, it is possible to restore harmony and guide the organisation back to its original intent.
Essential to this process is the buy in and commitment of the board and executive team, and support from skilled advisors who have the requisite experience and wisdom to facilitate the process.
Assisting new and established non-profits to thrive is something we have done for decades here at RSM. We have worked with countless private schools, not-for-profits, and charities of all shapes and sizes to achieve positive outcomes in governance, growth, culture, community impact, and more.
A simple conversation may be all that’s needed to begin steering a non-profit back to the brilliance of its original vision and values. With the right process, and a willingness for change, challenges can be overcome and robust foundations re-laid for sustainable success
For a confidential discussion about balancing growth, governance and core values in your non-profit, contact Andrew Bowcher on (02) 6937 7001 or your local RSM office.
