Why toxic culture and bullying exists in some not-for-profits

Restructuring Insights

From the outside looking in, a career or seat on the board with a non-profit would be a dream come true for many people – offering a valuable way to grow networks and skills while making a difference in a community they care about.

But for some people who work in the sector, this experience couldn’t be further from the truth. Instead, they are surrounded by constant conflict and bullying in a not-for-profit entity, plagued by low morale and high staff turnover.  For some people who work in the not-for-profit sector, they are surrounded by constant conflict and bullying plagued by low morale and high staff turnover.

In some cases, the issues become so severe that the trouble spills out into the public domain. We’ve seen this happen with the likes of St Vincent De Paul, the Uniting Church, Headspace, the Arthritis Foundation, and many more. Just recently, Noel Pearson’s Indigenous education venture, Good to Great Schools Australia, made headlines due to allegations of bullying and humiliation by senior staff members.

This is unfortunate because it undermines the important work these organisations do and affects the reputation of the sector as a whole.

While it’s certainly not the case for all non-profits, several factors could help to explain why these workplace bullying problems arise…

# 1: Governance models that value separation

As discussed in previous articles, it’s time for non-profits to consider whether the Carver Model of governance is helping or hindering their operation.

The model creates much separation between executives and the board, with the board simply setting direction and the CEO left to deliver on it. This lack of collaboration can then lead to a lack of transparency, ultimately resulting in agitated parties and a destructive blame game when issues arise.

Food for thought: Just because something has been done a particular way in the past doesn’t mean it should stay that way – especially when it’s not working. Consider engaging a governance expert to examine your practices, and invite them to mediate discussions between executives and the board until a clear path forward is determined. This may include re-drafting your constitution.

# 2: Mismatch between passion and skills

Non-profits attract highly passionate people who genuinely want to make a difference. When cultivated correctly, this can be a valuable asset. When it’s not, however, a wide gap can form between passion and the skills needed to manage the NFP successfully.

There must be a balance between passion and strategy, with a focus on big picture thinking. This often necessitates a commitment to effective hiring, training, mentorship, and other activities that protect the longevity of the organisation.

Food for thought: Big picture thinking doesn’t come naturally to all, and neither do certain skills that are as crucial to an NFP as any other business. If you’re unsure of the skills gap that exists in your organisation, engage an independent party to conduct a skills audit – including executives and board members if necessary.  

# 3: Unforeseen change

Non-profits sometimes have a difficult time balancing budgets to deliver the wide range of services they wish to provide – let alone if the scope of those services has to expand within a short period.

As can happen with government funding, having to divert resources to fill unforeseen gaps can cause immense uncertainty and pressure. This affects staff on many levels and often leaves them feeling anxious and powerless.

Food for thought: Effective financial management should always include scenario planning for unexpected events. Partner with a skilled accountant with deep experience in non-profits and ask them to help ensure budgets and KPIs are clear, and effective processes and reporting are in place.

Why bullying and toxic culture exists in some Not-For-Profits

# 4: Unclear values and poor hiring

To nurture a positive workplace culture, the people you hire must align with your organisation’s values.

Many NFP leaders assume their values are a given – after all, a value such as “helping others” is why they exist. But values are never a given; they must be lived and breathed at every level and integrated into the way people work. This includes the hiring process and the need to validate a person’s values before they are onboarded.  

Food for thought: Thorough screening during interviews, including activities such as psychometric testing and purposeful questioning, can go a long way towards ensuring that a person’s values align with that of the organisation. You especially want to protect against narcissistic personalities at a C-Suite level who may be skilled at charming the board but become evasive or temperamental once they are appointed.

# 5: Failure to communicate

It’s not only communication between executives and board members that can plague non-profits. As with any business, NFPs can suffer from a wide range of issues stemming from poor communication – from assumptions to gossip and everything in between.

Even for those who take no part in negative communication, the environment this creates makes it impossible for everyone to ignore office politics and focus on the work at hand.

Food for thought: Management should always model the positive behaviour they want to see, particularly when it comes to communication, collaboration, and transparency. An independent party can help uncover communication roadblocks and identify opportunities for improvement. This is particularly important for committee or board meetings where an independent party can express points made by attendees in different ways to help close any gaps in understanding.

How RSM can help

The skilled team at RSM comprises experts in non-profits, governance, board matters, financial management, and much more.As with any business, NFPs can suffer from a wide range of issues stemming from poor communication

As trusted advisers with a respected 100-year history, we offer a wide range of services including:

  • Operational and financial reviews
  • Governance consulting
  • Board training and skills assessments
  • Financial guidance including allocations, budgets, and KPIs
  • Scenario planning and forecasting
  • Support during board and committee meetings
  • Mergers and acquisitions
  • Outsourced CFO and grant acquittal services

Whether concerns about your non-profit are recent or long-established and systemic, it’s important to get to the bottom of it. Our goal is to help you re-imagine the future of your operations by shining a light on what’s not working and partnering with you to resolve it.

Be it relationships between board members and executives, difficulty managing finances, negative culture affecting morale, or any other issue – there’s no better time to take action than right now.

For further information

For an initial confidential discussion, please contact Andrew Bowcher on 
(02) 6937 7001 or your local RSM adviser