More than 10 years ago, a respected colleague of mine, John Kreidler, then the senior arts grantmaker for the San Francisco Foundation, began talking and writing about a critical dynamic of the nonprofit art world: the willingness of arts leaders to discount their labor in order to work in the field of the arts about which they were uncommonly passionate.

On the one hand, the passion and sacrifice of these leaders made it possible for thousands of smaller organizations to make and present the arts to the public ever since the boom in nonprofit arts began in the 1960’s. On the other hand, however, this dynamic did several serious disservices to the arts, the impact of which has been keenly felt for the past several decades.

First, leadership succession became a real problem. Leaders who had forgone seeking benefits or raising their salary over the years found they could not afford to retire. When a leader did leave, the organization’s board found itself unable to attract a capable replacement for the level of compensation its former, often founding, leader was willing to accept. 

Second, the low salaries and lack of benefits for workers in the arts created the impression by default that the arts are not a truly professional sector and that those working in it do not need the same kind of competitive compensation that workers in the “real” world require.

A corollary to this was the impression that, because employment was not structured along the lines of the competitive business model, the entire sector and all of its operations were viewed as not being business-like.

The capacity-building movement that has been rampant in the nonprofit sector has made efforts to address these issues. We now see leaders and their boards building financial and professional capacity in order to be able to respond to looming succession challenges as Baby Boomer leaders look toward retirement.

Younger workers in all fields have very different expectations for employment. And it’s not just about compensation and benefits. Two national studies came across my desk recently that explore the challenges of developing next generation leadership for the nonprofit sector: “Supporting Next-Generation Leadership, An Action Guide from Grantmakers for Effective Organizations” and “Ready to Lead? Next Generation Leaders Speak Out,” co-sponsored by the Annie E. Casey and Meyers Foundations, CompassPoint (a nonprofit services organization), and idealist.org/Action without Borders.

These studies identify a number of “structural barriers” and “significant deterrents” to attracting next-generation nonprofit leaders. Here are a few that caught my eye:

• Long hours and personal sacrifices. The classic and historic “burnout” model of the sector is not attractive to younger workers.
• Insufficient lifelong earning potential. The lack of capacity for salary increases, merit pay and sophisticated retirement plans. 
• Obscure avenues for advancement. Many nonprofits have very flat organizational structures with little or no opportunity for advancement through the ranks into leadership positions.
• Lack of mentorship and professional development opportunities. Nonprofits rarely provide professional development for their workers – a valuable benefit in the business world. And there is the perception, if not the reality, that older leaders are reluctant to bring younger workers along and may even feel threatened by them.
• The establishment’s aversion to change. Too many established leaders resist new ideas, perhaps seeing these as criticism of their own performance, or because they fear losing power before they are ready.
• Lack of technological capacity. Younger professionals want a work environment that supports their contemporary work style and moves as rapidly and comfortably as they do through successive technological advancements.

As the leadership guard changes in the arts world, it will be important for current leaders (who were as entrepreneurial and creative in their day as any of today’s innovative professionals) to recognize, welcome and pave the way for the leaders of the future.

It also will be critical for current leaders and their boards to create an operational culture and environment within their organizations that is not only attractive to younger professionals, but also flexible and mobile in response to the change that is now as much a constant in the nonprofit realm as it has been in the for-profit sector for decades.