Nonprofits can't win this fight. For the last decade, the chorus chiding nonprofits to act like businesses was almost deafening. If they act too much like a for-profit business, they risk loss of tax-exempt status. If they don't exercise enough self-interest, they risk failure.

Agree that board members need to stop treating non-profit resources like other people's money.

With respect to Tim's comment, invading endowments usually illegal. Dumb is just dumb whether you are running a for-profit or a non-profit.

Great piece Andrew and I especially like the woodworking reference. One of the messages that needs to be reinforced during a time of counter-productive financial planning among nonprofits is debt is something to assume with purpose and to be managed.

It isn't some sort of universal evil nor is it a harmless tool to carry from one year to the next without consequence. What's missing here is some reasonable guidelines for when to assume debt and to manage it regardless if it is planned or unexpected.

It is certainly just coincidence, but it is amusing that the captcha phrase for this comment is "whatever overdose."

In view of the number of solid NFPs that have grossly invaded their endowments, often with disastrous results, I question whether debt is the morally-neutral tool you describe. Many of the places I worked had one comptroller who was also the chief HR officer and the payroll department. They were often borderline alcoholics due to the stress of their jobs. Pressure to delay withholding tax payments and even 403(b) salary reduction (!) deposits were often yielded to. Weak boards applied different rules to an arts organization than their own for-profit companies used.

Not-for-Profit CEOs (remember, they used to be called Executive Directors, but CEOs get higher salaries and more respect...) are more qualified today than they used to be. But they still don't get the training and seasoning that a big corporation's promotion process provides. And when artistic directors have too much input, board candidates for the top job can slip down in the list.