Goals & Objectives for Nonprofits
Nonprofit organizations should use their mission statements to guide their short- and long-term goals and objectives. Whether the organization is a trade association, charity, research foundation or other service organization, its reason for creation should guide its board each year as it sets program and financial goals. These objectives often include fundraising, funding, public awareness and membership goals.
The first step in setting goals and objectives for a nonprofit is to check the organization’s bylaws. This will not only help you determine what the entity’s goals should be, but might include prohibitions against activities. For example, many nonprofits forbid participation in political activities, including lobbying or funding or endorsing any referendum, party or candidate.
The Internal Revenue Service allows nonprofit organizations to make a profit as long as the primary purpose of the organization is not to make a profit, and as long as the organization spends most of its funds pursuing its purpose. If a nonprofit makes a considerable profit each year or spends most of its funds on internal activities rather than pursuing its stated purpose, the IRS might revoke the organization’s tax-exempt status. Meet with a qualified accountant or tax professional to determine if you are meeting your IRS requirements to maintain your nonprofit status.
Committees exist to serve the needs of the organization, its members and the public. Committees often include marketing, membership, finance, education and giving. Set specific goals for each committee at the beginning of the year, asking each committee to make its own recommendations for review by the board.
Many nonprofits set an objective of increasing public awareness about the organization and its related purpose. This could include a trade association alerting its industry or profession about the organization’s activities and values, or a charity educating the public about a disease, environmental problem or other public concern.
Membership is the lifeblood of many trade associations or public nonprofits that require public participation, such as a state wildlife group. Set separate membership attraction and retention goals and objectives, with plans for improving both. Each effort should have a budget and revenue projection.
Fundraising and giving are obvious goals of many nonprofits. Work with each committee to evaluate its previous year’s performance, set goals for the coming year’s efforts and put in place tracking and performance reporting to the board so you can spot any shortfalls as soon as they begin to happen. In addition to soliciting charitable contributions, create a grant-writing and acquisition goal. If your organization is a 501(c)(6) trade association, consider creating a 501(c)(3) foundation to accept charitable donations, providing donors a tax write-off they don’t get when contributing to a trade association.
Many nonprofits fund scholarships, charitable giving and other activities from the interest earned on an endowment or fund that keeps the principal and spends only the interest. If your nonprofit does not have an endowment, consider setting the creation of one as a goal. Some endowments come from the contribution of a single donor or organization.
In addition to bringing in donations and earning interest on your endowment, make it a goal to increase non-dues revenue, such as selling sponsorships, newsletter, magazine or website ads, trade show booths, logoed items and other marketing opportunities. These revenues might be taxed, even if you are a nonprofit, so check with a tax expert to make sure you properly budget these revenues.