Many nonprofit leaders begin their careers with an optimistic, yet amorphous vision to make the world a better place. Over time, the stress of day‑to‑day operations can dim the passion behind that vision, eroding confidence, and muddying clear‑eyed purpose. Even highly experienced executives can get distracted by back‑office tasks that siphon energy from mission‑critical leadership functions.
For many nonprofit leaders, administrative duties feel like a juggling act. The day might be spent bouncing between meetings about nonprofit finance, human resources, and a new marketing campaign. Unfortunately, these back‑office operations siphon limited time and energy that could be directed at mission‑specific projects.
For years, risk management has been baked into the daily business of giant corporations. Business leaders rely on risk management to identify, assess, and protect against potential losses that impact the corporation’s bottom line and reputation. But the Nonprofit Risk Management Center reports that the discipline is still gaining traction among community‑based organizations (CBOs).
The 2017 Equifax breach acted as the canary in the coal mine for many organizations, but perhaps it shouldn’t have been surprising. It’s no secret that hackers have become more sophisticated over the last few years. Cybercrime has exposed millions of clients’ personal identifiable information (PII) across countless organizations.
Nonprofit leaders often struggle to balance their time between making meaningful community impact and addressing operational necessities. From fixing cash flow issues to managing payroll, back-office tasks can overwhelm both administrative staff and the organization's leadership.
Behind every impactful nonprofit is a solid financial management strategy. Below, we review a set of core best practices that organizations can use to succeed in your nonprofit financial management.