Bases of Power and the Dominant Coalition in Nonprofit Organizations
David Renz, University of Missouri - Kansas City; Fredrik O. Andersson, University of Missouri, Kansas City
Research on nonprofit boards of directors and governance has grown substantially in the past decade. Still, while many vital and interesting insights about boards and governance have emerged the changing nature of the nonprofit sector has prompted scholars to ask for additional and more sophisticated ways of understanding nonprofit organizations, boards, and governance. In their review of nonprofit governance research, Ostrower and Stone (2006: 624) conclude that an emerging theme in the literature “is that boards are not isolated entities, and that governance itself is often undertaken jointly by boards in connection with other parties.” They call for the development and application of new theoretically grounded approaches in nonprofit governance research. Interestingly, a similar perspective is emerging in corporate governance scholarship as some scholars argue that we rethink our current approach to governance and “search for alternative paradigms of governance” (Huse, et al., 2011:23)
One key issue is that much nonprofit governance research employs the governing board as the unit of analysis. The result is that board and governance are treated as synonymous; relatively few researchers distinguish the two. This is understandable, yet the time has come to refine our approach. Governance is a function; it involves making choices about mission, vision, strategic direction, and priorities for action. Boards are structures and, while they typically play a key role, they are not necessarily the only actor of significance in governance. It is time we began to more effectively differentiate the two.
This paper builds on a conceptual and theoretical discussion that acknowledges that the key actions and decisions embedded in the governance function are made by coalitions of individuals (Cyert & March, 1963). More specifically it employs the construct of the “dominant coalition” (Thompson, 1967) to examine governance processes in which both board members and other actors are understood to exert significant influence. Though not new, the construct of the dominant coalition has not been employed in any substantive way to explain the dynamics of nonprofit governance and how it occurs with little regard for the formal setting in which it is supposed to occur. By definition, the dominant coalition must be the true home for nonprofit governance, so this focus allows us to examine where and how governance actually is implemented and how this relates to the formal structure of the board.
Focusing on the dominant coalition requires that we address issues such as organizational politics, influence strategies and power. Many nonprofit board studies have implicitly discussed these issues, yet we know relatively little about how these elements are significant to governance processes and outcomes. This paper will explicitly consider one of these critical issues: the role of power in nonprofit governance. The “lens” of the dominant coalition makes it possible to reframe key research questions to develop distinctive insights on certain issues that pose significant challenges for conventional board-oriented research, including the power dynamics among multiple stakeholders inside and outside the board room. Thus, while the nonprofit board has the authority to govern, it is not the only agent with power in and around the organization. The purpose of this paper is to develop a conceptual and theoretical understanding of who has power to affect nonprofit governance and, more specifically, what are the bases of such power? The organizational literature includes several frameworks for conceptualizing bases of power (Bradshaw, 1998; Finkelstein, 1992; French & Raven, 1960) and, by comparing and contrasting these established frameworks as they apply to nonprofit governance, we seek to outline the relevance of different power bases for different potential dominant coalition actors.
References
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Huse, M., Hoskisson, R., Zattoni, A., & Viganò, R. (2011). New perspectives on board research: Changing the research agenda. Journal of Management and Governance, 15(1), 5-28.
Ostrower, F. & Stone, M.M. (2006). “Boards of Nonprofit Organizations: Research Trends, Findings, and Prospects for the Future.” In W.W. Powell and R. Steinberg (eds.), The Nonprofit Sector: A Research Handbook. (2nd ed.) New Haven, Conn.: Yale University Press.
Thompson, J.G. (1967). Organizations in action. New York: McGraw-Hill.