Better Governance For Nonprofits: Leadership That Works

In the nonprofit world, governance often clings to outdated, top-down leadership models, emphasizing hierarchy, control, and directive authority. These approaches may have served organizations in the past, but they are increasingly inadequate in addressing today’s complex challenges. Nonprofits operate in a world of interconnected systems, shifting cultural values, and growing demands for equity, collaboration, and innovation. Many boards and leaders, however, remain entrenched in traditional leadership concepts, failing to adapt to the participatory and relational approaches that modern times demand.

The Need for Transformative Leadership
At the heart of this issue lies a fundamental misunderstanding of leadership. Too often, leadership is viewed as a static quality embodied by a select few rather than a dynamic, relational process that involves all system members.

Scholars like Peter Senge (1990), however, argue that leadership is about building systems and fostering organizational learning to respond effectively to complexity. This approach contrasts with traditional, top-down models of leadership that emphasize individual authority. Transformative leadership offers a much-needed alternative to outdated models because it shifts the focus from individual authority to collective participation, creating a context where all voices are valued, relationships are nurtured, and creativity thrives.

Transformative leaders understand that effective governance is not about exerting control but fostering collaboration. They embrace the idea that leadership is not a one-way street but a mutual process where leaders and followers engage in a shared journey. James MacGregor Burns (1978) introduced the idea of transformational leadership as a mutual stimulation and elevation that converts followers into leaders. Building on this notion, transformative leadership emphasizes mutual growth and the creation of generative contexts where all members of an organization contribute meaningfully.

This shift is essential for nonprofits. While hierarchical structures might offer a sense of order, they often stifle creativity, marginalize diverse perspectives, and fail to address systemic issues. Research by scholars such as Margaret Wheatley (1992) highlights the limitations of control-based systems and the power of collaborative, adaptive approaches.

However, resistance to change persists. Boards and executive teams often cling to hierarchical models out of habit or fear of losing control. This mindset is counterproductive, as traditional governance frameworks may provide a veneer of stability, but they are ill-suited to the interconnected and unpredictable challenges nonprofits face today.

Reimagining Nonprofit Governance
To overcome these limitations, nonprofits can reimagine governance through the lens of transformative leadership. Leaders must engage in self-inquiry—a practice emphasized by thinkers like Parker Palmer in The Courage to Lead (1998)—to reflect on their assumptions about power, identity, and relationships. Boards, too, must evolve, shifting from oversight and gatekeeping to active partnerships with staff and stakeholders.

Transformative leadership is not just a theoretical ideal but a practical necessity. As Otto Scharmer argues (2007), effective leadership requires letting go of old patterns and embracing the co-creative potential of the present moment. Nonprofits that adopt this approach can move beyond the inadequacies of top-down governance and become true agents of systemic change.

The question is not whether transformative leadership is needed in nonprofit governance—rather, it is why we still cling to outdated models. By embracing participatory and relational leadership, nonprofits can align with the complexities of the world they seek to change, fostering equitable, sustainable, and impactful futures.

The time for transformative leadership is now. Are we ready to answer the call?