ABSTRACT
Nonprofit organizations play an essential role in the American safety net, providing for basic needs and essential social services in diverse communities throughout the United States. Despite shifting demographics in the American population, nonprofit human service organizations remain surprisingly unrepresentative of the communities they serve. As the commitment to diversity is often believed to begin at the top, nonprofits face increased demands to diversify their governing boards. At the same time, nonprofits experience pressures for performance from their funding entities as well as the public. Using a mixed-method explanatory sequential design, this chapter first presents an analysis demonstrating a statistical link between racial diversity on nonprofit boards and both objective (financial) and subjective (self-reported) measures of performance. The underlying mechanisms of the diversity-performance relationship are further elucidated through a multi-case comparison based on document analysis and interviews with nonprofit CEOs and board chairs. This research can inform the funding community, including government agencies and foundations, about the tangible value of diversity and the need for strategic investment of resources in charitable organizations.
