AI and Nonprofits: What Boards Need to Know

Generative artificial intelligence (AI) has taken the world by storm since ChatGPT was released nearly a year ago. The technology has been adopted with astonishing speed. Generative AI has the potential to be a powerful tool for nonprofit organizations, but it also requires board members to understand the challenges and ethical concerns it presents, along with its benefits.

Insider Intelligence predicts that generative AI adoption will climb to 77.8 million users by 2024. If you and your staff are not using AI yet, chances are you soon will be.

A huge benefit for nonprofit organizations is that AI doesn’t require a large investment in software or hardware – it’s cloud-based, with many free versions available. People can use it on their phones, laptops, desktops, and tablets. It does, however, require guidelines to ensure your team uses it appropriately and strategically.

While AI continues to evolve in capability and sophistication, thinking strategically about its use, the potential benefits and the potential downsides will serve your organization well.

The Benefits of Generative AI for Nonprofits

Nonprofit organizations and associations typically run on tight budgets and lean staff numbers. One of the key benefits that AI brings to mission-driven organizations is allowing them to make the most of their limited resources.

It enables automation of routine administrative tasks such as:

• Generating reports
• Sending reminders
• Entering data
• Scheduling appointments
• Answering queries that come in through websites

AI can also be used to analyze and summarize data and information on donor surveys, public engagement statistics, volunteer feedback, grant applications and any other collected data. This means less time spent manually compiling reports and more time on looking at insights for better decision-making.

Marketing and communications team members can use AI to create tailored content for donors and other audiences, including social media posts or newsletter copy.

Beth Kanter, Allison Fine, and Philip Deng write in the Stanford Social Innovation Review: “Used carefully and skillfully, AI has the potential to save people thousands of hours of rote, time-consuming work a year, freeing them up to do the kinds of things only people can do: solve problems, deepen relationships, and build communities.”

Integrating AI into Operations

Some of the main ways that nonprofits have integrated AI into their operations include:

• Fundraising: AI can create personalized emails and pitch letters by analyzing the organization’s information and data on previous and potential donors. Grant writers can use AI-generated templates and outlines to support grant applications. AI data analysis can also help summarize requirements and criteria for each grant application.
• Communication: Generative AI tools such as ChatGPT, Bard, and Bing can generate draft press releases, social media posts, marketing copy, newsletters, and other communications material. Because of its ability to personalize communications, AI can be a way to engage donors, volunteers and the public without requiring intensive staff work.
• Customer Service: Chatbots can handle inbound queries and requests, simulating human conversation by using natural language processing. AI can also use predictive analytics to reveal patterns in client behavior that will help the organization anticipate future needs.
• Data Analysis: Traditional data analysis can be a time-consuming and often cumbersome process, especially when looking at large datasets with complex and connected information. AI can handle and process complex data quickly – and sometimes more accurately than humans.

However, remember that this technology has only had widespread use for a year. While the benefits of AI are clear, the pitfalls and the long-term effects of AI deployment must be in the forefront for nonprofit organization and board leaders.

AI Considerations for Volunteer Board Members

Volunteer board members should be aware of several important considerations when it comes to the use of AI in their organizations. AI can offer significant benefits, but it also presents challenges and ethical concerns. Here are key points for board members to keep in mind:

Training

AI is a new technology, and everyone’s learning curve is different. No matter the level of comfort or experience with AI, board members, as well as organizational leadership and staff, need training. Board members can’t make informed decisions about AI usage and practices without an understanding of the technology. Also, staff members should be adequately trained to use it appropriately in alignment with policy and guidelines.

Data Privacy

AI relies heavily on data, and handling sensitive donor and beneficiary information raises ethical and privacy concerns. Nonprofits must ensure compliance with data privacy laws and adopt robust security measures to protect sensitive information and while maintaining donor trust.

Data Quality and Bias

AI algorithms only reflect the data they are trained on, which can possess bias and perpetuate discrimination and inequality. Caution is needed when making decisions based on AI data analysis to ensure that ethical AI practices are in use, including bias mitigation.

Transparency and Accountability

Board members should have a clear understanding of how AI is used by their organization and ensure accountability for its outcomes. Donors, volunteers, vendors, and funders also should be informed about AI usage and goals. Transparency around AI helps build trust with your stakeholders that AI is being used ethically in your organization.

Impact Assessment

Evaluating the impact of AI on the organization’s programs, services, and beneficiaries is essential. AI is evolving, so adjusting strategies may be necessary if the technology is not achieving its intended outcomes.

Risk Management

AI poses potential risks, including reputation harm caused by AI errors. Security breaches from hackers specifically targeting AI is another risk. Plan how the organization will deal with these situations when they happen and put safeguards in to prevent security and reputational issues.

Elements of an AI Governance Framework

An AI governance framework is essential to ensure responsible and ethical use of AI technologies by nonprofit organizations.

Here are some tips for creating and implementing such a framework:

1. Ensure that the AI policy aligns with the nonprofit’s mission and core values. AI should support and enhance the organization’s goals. Define the purpose of the AI policy and specify its scope, including which AI initiatives and applications it covers.
2. Focus on the human element, making sure that employees know that AI is going to help them work more creatively and strategically, not take their jobs.
3. Define the roles and responsibilities of individuals, board committees, and staff members responsible for oversight and implementation.
4. Plan for training the board and staff in AI ethics, responsible AI practices, and the organization’s AI policy.
5. Explain how the organization will engage with the community, including donors, volunteers, funders, and vendors. Gather feedback and address their concerns regarding AI initiatives.
6. Outline the process for reviewing, updating, and approving changes to the AI policy, involving relevant parties as needed
7. Articulate the ethical principles that guide AI initiatives, such as fairness, transparency, accountability, privacy, and nondiscrimination. Emphasize the organization’s commitment to identifying and mitigating bias in AI algorithms and data sources.
8. Address how the organization will comply with AI-related laws and regulations, including data protection laws, and describe how the organization will stay up to date with changes in legal requirements.
9. Develop a timeline for the stages of implementation of the AI policy and initiatives.

AI Advancing the Organization’s Mission

Ultimately, the successful integration of AI into nonprofit organizations requires a strategic and thoughtful approach, where AI is seen as a tool to enhance — not replace — human capabilities, and advance the organization’s mission.

Trusted board management software can help nonprofit governing boards navigate the waters of AI implementation and policy. With software like BoardEffect, boards can collaborate easily on creating and implementing AI guidance policies.

Board members can have strategic discussions as needed, during meetings or other times. The data needed for decision-making is available at any time board members need it. Essential training for the board and for staff on AI usage and implications can also be made available through your board management software.

BoardEffect is designed with the unique needs of volunteer boards in mind. Our nonprofit board management software streamlines board processes, enhances communication and promotes accountability, helping you to become an efficient and effective board.

To learn more about how a BoardEffect board management system can serve your mission-driven organization and support your AI best practices, request a demo today.