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Non-profit accountability = full transparency

Nonprofit accountability is not a subjective matter; lack of accountability is not an option! A nonprofit organization that is recognized by the Internal Revenue Service, under IRS regulations chapter 501(c)3, is determined to be a Public Charity, which exists for purposes that will benefit members of the public. The corporation does not exist for the benefit of the founders, nor do the founders own the assets of the organization. The officers and director of nonprofits have a fiduciary and ethical obligation to their donors and the public at large to conduct themselves in an accountable and transparent manner. They have accepted positions of stewardship and must conduct their own self-governance consistent with the principles of the vision and mission of the organization.

The important point here is that you as the founder DO NOT own the organization. To many entrepreneurial types, this may feel a little uncomfortable and disheartening. You have identified a cause or feel personally compelled to serve a need in society. Trust me, though; you will want to fully embrace this concept of accountability and transparency for many benefits and reasons.

The nonprofit organization has the opportunity to benefit from transparency, as in the current economic environment, making information about your organization easily known and accessible to supporters and potential donors may help improve their comfort level with — and donations to — your organization.

Let’s look at improving the transparency of your communications:

Step One: Change the website (you have less than 10 seconds to get their interest)

The material should be a blend of high impact photos and fact-filled text, you can always have a “Read More” button for people that want to know all of the details.

• The Vision and Mission Statements are shared with the world.
• The Strategic Plan is openly shown.
• The financial needs to accomplish the strategic plan are highly visible.
• The measurements of success are identified and clearly stated.
• The scoreboard can be seen by all to become engaged.

Step Two: Change the print material  (you have less than 10 minutes to get their interest)
The print material should be a blend of high impact photos and fact-filled text, but you don’t want to get into all the facts. You can use your website for that.

• The Vision and Mission Statements are to be complete and compelling.
• The Strategic Plan should only be summarized by bullet point.
• The financial needs are brief and tie in to the Strategic Plan summary.
• The measurements of success are identified and clearly stated.
• The scoreboard can be seen by all.

Step Three: Private Donor Communications (you want to keep all donors informed)
The written communications to your donors should vary by level of contributions, it is recommended to have levels A (top 10%), B (top 30%) and C (the balance).

• The Vision and Mission Statements should be shared briefly in all communications.
• The communications should be scheduled for the year to all levels of donors.
• The communication methods can vary from phone calls, letters and hand written notes.
• The method and frequency of communications may be determined by the organization’s budget, but do remember the importance.

Step Four: Public Donors and Grants (you want to meet or exceed all required reporting)
The reporting schedule and requirements should be clearly defined at the beginning of the relationship, if they are not clearly defined, you must determine with the appropriate person.

• The Vision and Mission Statements should be shared briefly in all communications.
• Reporting to Foundation and Public entities generally is more matrix-driven vs photo/text -driven as above.
• There should be consideration given to any other stakeholders that need to be kept informed.
• It is also recommended that entities in this category be included in the A,B,C level communications.

The topic of accountability is as important to non-profits as customer satisfaction is to for-profit organizations. It is also as important as keeping investors and bankers informed. Accountability is something to keep on your radar at all times, not just when it’s reactive to negative economic trends or headlines about ethics. Accountability should be welcomed by non-profit leaders as the opportunity to get broad-based organization buy-in and engagement.

 

Nonprofit impact: How do you know your nonprofit organization has actually impacted the culture?

Every nonprofit organization has been created to address a social cause or respond to a compelling need. The vision and mission statement articulate the purpose of the organization. The strategic plan outlines the steps to get from the current to the future. The financial statements and budgets keep score on the funding, the accountability communication plan keeps all of the stakeholders informed of the progress and the detailed matrix reports keep track of how many have participated in all of the programs.

But there is one very big question generally not addressed: Have you changed the DNA of a culture? Put another way, “Have you permanently changed the way they think with their brain and the way they feel with their heart?”

While every purpose-driven organization needs to meet certain goals and objectives, measured by various matrix and measurement tools, the social entrepreneur needs to also consider the “social change” aspect of their mission. This is not as measurable in many cases as the success of matrix and measurement tools. Perhaps the social impact is the “by-product of success” of all of the above.

As an example, let’s look at an after-school program five and ten years after a student’s completion of the program and ask the question, “What have the participants done after program completion?”

• How many students have gone on to secondary education?

- How many students have gone on in the field of education?

- How many students have turned to help others in their educational needs?

• Who are the current leaders of the organization?

- Are the same founding leaders in place?

- Are the leaders products of the program?

- Are the organizational leaders from the culture being served?

• Who have become the primary funders of the organization?

- Are the same funders carrying the vision?

- Are any of the funders products of the program?

- Are the organizational funders from the culture being served?

• What is the public perception of the organization?

- Has the community been brought into the vision?

- Have the people completing the program been brought into the vision?

- Has the vision been adopted as theirs, from the culture being served?
While the topic of cultural change or social impact is not very easy to define or measure, these are the nuggets every non-profit wants to capture, the facts that will set one organization apart from the rest. These are the facts that will give compelling evidence that a particular nonprofit is worthy of the investments of individuals, the community and any other funders.

Many organizations can look back and see in their mind’s eye the outstanding individuals who have gone on to success as a result of the program. Not many can show a trackable path of success for the majority.

Here are three sure-fire ways to document social impact and cultural change that will change the future of your nonprofit organization.

1. Create and maintain a trackable method of each participant from the day they start in the program.
2. Create a written survey of 10 (or fewer) questions to be given to program participants every three months.
3. Create a semi-annual town-hall open format of the community served to solicit their input.

The social impact and cultural change of a community served will generate substantial funding to establish endowments and bring the organization into perpetuity. Nonprofits that are successful in documenting such social impact and cultural change will become truly sustainable.