Articles

Written by Dan Busby
From his column God, Government and Me—Money in the Church

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The results of a recent ECFA church survey reflect some intriguing strengths and areas of potential improvement in how churches are governed. Church board members and church staff answered dozens of questions about their effectiveness and the challenges they face. Here are a few of the key findings from this survey.

Grading Your Own Paper

When asked about effectiveness (see Graph 1), most respondents “agree” or “strongly agree” that their boards are effective. Interestingly, respondents who actually served on the boards did not seem biased. They scored their effectiveness at 3.11 (out of 5), while staff and volunteers scored their boards at 3.05 (out of 4).

Graph about effectiveness
Graph 1

One for You and One for Me

Of the churches surveyed, most (60.4 percent) spend 41 to 60 percent of their budgets on salaries and benefits for staff. On average, respondents reported that 48.9 percent of their church budget is spent on salaries and benefits.

Additionally, the typical church receives (and spends) about $1,926 per attendee per year ($37 per week).

Stable or Able

The most common characteristic or qualification that churches desire in potential board members are “faithful member” (90 percent) and “consistent giver” (52 percent). Interestingly, “financial experience” (20 percent) and “legal experience” (6 percent) are among the least desired qualifications of the options provided.

We Meet Again

The “median” board meets once a month and the median meeting is about two hours long. By multiplying average meeting length by the number of meetings per year, we estimate that the median board spends 18 hours together each year.

The median board meeting has 90 percent of board members present. Twenty percent of respondents report that their normal meeting has 100 percent attendance, showing great commitment among church governing boards.

At the most intense end of the spectrum, one board appears to meet for nearly 14 hours each month while the average board meets for about 28 hours a year.

Diminishing Returns

The “most effective” boards spent between 21 and 40 hours together over the course of a year. They also meet at least once a month earning a 3.42 (out of 4) instead of 3.06 for boards meeting less frequently. Boards that meet less than two hours at a time are less effective 3.07 (out of 4) than those who meet longer (3.21 out of 4).

On average, respondents reported that 48.9 percent of their church budget is spent on salaries and benefits.

What Drives an Effective Board?

The data suggested that affirmative answers to five questions predict a board’s effectiveness:

  1. Does the board have policies in place and the spiritual integrity required to ask an underperforming member to resign?
  2. Is the board willing to challenge and correct the lead pastor when necessary?
  3. Does the board have an active strategic planning process in place?
  4. Does the board devote time and energy to assessing risks and opportunities?
  5. Does the board help the staff by offering strategic—not tactical—input?

Conflicts of Interest

When asked to describe their governing board’s conflict of interest oversight, nearly half (49 percent) of churches said they do not have a conflict of interest policy. One in ten churches (12 percent) indicated they probably have a conflict of interest policy, but the board has not reviewed it for a long time.

Only about one in six churches (16 percent) said they have a conflict of interest policy, refer to it when needed, and require the board and key staff members to annually complete a conflict of interest questionnaire related to the policy.

Related Parties On Board

Only half of the churches (52 percent - see Graph 2) report having no one on the board who is related to other members of the board or staff either by blood, marriage, or significant business relationships. Fortunately, only 3.1 percent of churches have more than half of the board members related to others on the board.

Graph about effectiveness
Graph 2

Overly Involved in Details

Almost 10 percent of respondents said their board is deeply involved in the church’s daily operations. On the other hand, 28.3 percent said their board is disciplined in keeping its focus on high-level issues, leaving daily operations entirely up to staff.

Conclusion

As you can see, our survey revealed some interesting characteristics for the way churches are governed, many of which are encouraging. Church boards that give themselves seriously to their fiduciary, strategic, and governance roles are a blessing to their pastors and congregations and do much to advance the Kingdom of God.

Dan Busby is a certified public accountant and president of the Evangelical Council for Financial Accountability (ECFA).

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