NONPROFITS ARE CONCERNED ABOUT THEIR LONG-TERM FINANCIAL STABILITY

By December 19, 2016Blog

More than half of nonprofit leaders expect conditions in the sector to be more difficult in 2017, according to the most recent Nonprofit Leadership Pulse. The national survey of nonprofit leaders and executives was undertaken by leading accounting, tax and advisory firm Marks Paneth and fielded before the election.

According to Michael McNee, Partner-in-Charge of the Nonprofit and Government Group at Marks Paneth: “When asked to name their most significant challenge, more than one-in-four (28%) say that achieving long-term financial stability is the greatest challenge facing their organizations. To address this challenge, 81% of nonprofit leaders surveyed, agree that the identification of programs that generate positive cash flows will be very important.”

McNee went on to explain, “The long-term financial stability of nonprofit organizations requires disciplined leaders who have keen financial acumen and are focused on mission-critical programs that generate funds.”

Although 60% of leaders surveyed cited government funding as an important source of cash flow, 78% said that they rely on private funding, such as corporations, foundations and individual donors. The consolidation of wealth in the United States is likely to mean more intense competition for funding from fewer private sources.

“One conclusion,” said Hope Goldstein, a partner in the Nonprofit and Government Group at Marks Paneth, “is that, as funding sources change, fundraising too must change. The first place to focus is tracking donors and building programs to retain them. Partnering with corporations is another place to focus.” A growing number of corporations are building social responsibility programs into their mission. Partnering with these businesses offers many benefits to nonprofits, such as sharing expertise, implementing employee monthly giving programs and matching programs. Technology also offers creative new ways to raise funds.

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