Leadership Journal

It's not enough to manage church finances according to "sound business principles," because the definition of "sound business principles" varies widely, shaped by the culture, mindset, and financial setting of each particular community.
—Gary Fenton

Late one evening, a young pastor called me, a frantic tone in his voice. He quickly got to the point: he feared he was about to be fired.

He outlined his story. Nine months earlier, when he accepted the church's invitation to become pastor, the church's needs and his gifts had seemed a good match.

Although the church had a budget, the former pastors and treasurer had never followed it. Upon the death of the tenured treasurer and the resignation of the pastor at about that same time, the church thought it a good time to bring order to their financial chaos.

According to the pulpit committee, the church needed a pastor with administrative gifts; according to this young pastor's own understanding and the evaluation of his peers, administration was his strength.

My friend quickly applied some of his organizational skills and set up a new structure for managing the money. Because his new system gave more responsibility to people and less control to the pastor, he assumed his new semi-rural, conservative parishioners would rise up and call him blessed.

Instead, they rose up and blasted him.

The same leaders who had wanted him because of his management skills were criticizing him publicly for lack of administrative ability. The leaders felt they had been misled.

The pastor, for his part, felt betrayed. He counterpunched by reminding the leaders of the church's financial chaos when he began. One long-time church leader said he preferred chaos to the new system. Soon the pastor and leaders were questioning each other's integrity.

What went wrong? Did the pastor lack financial and organizational skills? Did the lay leadership overestimate their management abilities? Or was something else at work here?

Although many factors can cause pastor-versus-church conflicts, money issues are likely near the top of the list. After visiting the church and hearing both sides, I became convinced that neither the pastor nor the lay leaders were inept or lacking in integrity. The pastor simply followed business principles used in a large corporation, and the church leadership followed principles used in small, privately owned farms and businesses.

It's not enough to manage the finances according to "sound business principles," because the definition of "sound business principles" varies widely, shaped by the culture, mindset, and financial setting of each particular community.

I have served churches in four settings: an agricultural area, a community with a highly competitive tourist industry, a university community, and a small city dependent on the oil industry. Each church's financial accounting system reflected, in different degrees, the local community's prevailing definition of good business.

I've also visited with other pastors and churches, ...