It was seemingly a year and forever ago when we last wrote about nonprofit trends reports. Back then, we were concerned about heady items like constituent-centric experiences, data-driven culture and strategy, technology for change, and use cases for technology. While these things remain interesting, they’ve yielded to fresh, pandemic-related concerns, and to the acceleration of priorities regarding social change and diversity, equity, and inclusion.
These are all big items and have thrown our worlds into imbalance. Our latest 4th edition of the Nonprofit Trends Report reflects a set of organizations struggling with this imbalance while navigating a rapidly-changing future.
Our goal at Salesforce.org in delivering our own nonprofit trends report each year is to better understand: the role nonprofits have in serving their communities, what’s shifting within the nonprofit space, mental health and wellbeing, and how technology supports an organization’s ability to fund and run their missions across departments.
This year, the report features survey responses from 1,250 nonprofit employees at the manager level and above. The survey’s aim is to better understand:
- The biggest challenges nonprofits face today and in the future
- Trends in diversity, equity, and inclusion
- How nonprofits are traversing the extreme shifts in the workforce
Of the surveyed nonprofit employees, roles included responsibility for programs, fundraising, grants management, technology, HR/office, or marketing. Respondents were from the United States, Canada, the United Kingdom, Australia, the Netherlands and Nordic nations (Norway, Denmark, Sweden and Finland).
First up is finances. I’ve spoken with quite a few nonprofits over the course of the pandemic. Unsurprisingly, money issues rose to the top of the discussion almost every time. Complementing this, the report shows that many nonprofits enjoyed generous donations from donors, but revealed that controlling expenses is becoming increasingly challenging for 45% of respondents in the U.S. and 26% in Australia.
Mackenzie Scott garnered plenty of publicity in the past year, with very generous distribution of large sums to a diverse array of organizations. This perhaps points to a trend of continued commitment from major donors — most interesting is the category of unrestricted money. Going forward, nonprofits will have to continue to invest in technology if they wish to keep up with changing audience expectations, as well as opportunities for improving — and even redefining — the way they engage with their supporters and beneficiaries.
The continued flow of money into the nonprofit world is welcome news. Yet, nonprofit leaders and managers will have to carefully assess, prioritize, and take risks with their finances, which will likely require new skills and bold adaptation to continuously changing circumstances.
Unsurprisingly, staff wellbeing was a major issue for nearly a third of nonprofits throughout the pandemic. At the largest nonprofits surveyed, ensuring employee mental health and wellbeing was a major issue, and a small majority said their organization’s approach to employee wellbeing had changed during the previous year.
We also asked respondents about diversity, equity, and inclusion (DEI). As the pandemic accelerated the adoption of technology for nonprofits, the murder of George Floyd in 2020 gave new urgency to organizational prioritization around diversity and mental health in their workplace structures. It seems organizations are responding: 49% of nonprofits said that over the past 12 months their organization has changed its approach to DEI, and 85% said they met or exceeded their goals in this area. Some of the changes include 37% of organizations actively increasing board diversity, 43% increasing organization/leadership diversity, and 35% increasing staff diversity. While not perfect, it seems a step in the right direction.
Challenges remain, however: 87% of respondents agree that it’s important to take measures to ensure gender and racial diversity across all levels of the organization. This includes ensuring that their organization is hiring from across the gender spectrum, as well as all racial and cultural backgrounds for all positions, including appointing a similar mix to the organization’s board of directors. Additionally, 61% of respondents said their organization has made commitments to advance DEI.
However, our report found that perception and reality often clash. For example, 80% of respondents said their organization’s board of directors was diverse. While boards might be getting slightly more diverse, they are far from representative of the communities they serve. Governing bodies studied by BoardSource in 2019 included a higher percentage of people of color than the previous study — 22% in 2019 versus 16% in 2017. Only 38% of executives felt their boards represented the communities they serve, and 66% expressed dissatisfaction with their boards’ racial and ethnic diversity. Meanwhile, 29% of board chairs felt their boards represented the communities they serve, and 45% expressed dissatisfaction with the boards’ racial and ethnic diversity.
Another complex demand of the modern nonprofit is employee wellbeing and workforce development. Obviously, the COVID-19 pandemic has taken its toll in countless ways, and the survey results back that up. Nearly one-third (32%) of all nonprofits surveyed said ensuring the mental health and wellbeing of their employees was a major issue for them over the past year, with 38% of nonprofits with revenues of more than $10M rating it a major issue, compared to only 28% of those with revenues below $1M.
The even greater challenge is that 35% of organizations anticipate that it will be increasingly more challenging in the coming year. Adoption to remote work, increasing ambiguity, safety concerns, rapid change/constant re-prioritization, and a high staff turnover rate continue to wreak havoc — we’ve all heard by now about “The Great Resignation.” Organizations are taking action: Seventy-six percent of respondents said their nonprofit offers support services to help with mental health and wellbeing. Organizations will have to navigate these complexities in order to take care of their people today, as well plan for a healthy future.
Change is happening, and we must carefully, but purposefully, rise to the occasion. As noted, our recent priorities include constituent-centric experiences, data-driven culture and strategy, technology for change, and use cases for technology. These things haven’t evaporated, but they’ve joined an already-long list of priorities.
While technology adds to this complexity, it is, ultimately, a big part of the solution. We’ve been able to hold a lot together using tech during the pandemic, but it’s taken its toll: 84% of respondents say working remotely will remain a challenge or become increasingly more difficult over the next 12 months.
Other tech-related challenges include: making decisions based on data and evidence — something that only 34% of organizations say they “always” do — as well as designing programs and services using information about and engagement with recipients. Additionally, nine in 10 respondents evaluated their organization’s use of technology as excellent/good across all areas. Yet only 22% of organizations fell into the high digital maturity bucket when we assessed their digital maturity across a five-question Digital Maturity Index, which we created in 2020 in our 3rd edition of the Nonprofit Trends Report.
This is what it looks like when we’re swimming in the middle of a sea change. Never has there been so much sophisticated tech available to nonprofit organizations — innovations that could bring tens of thousands more people into their missions, and bring an unprecedented ability to take action and measure impact. We need to be compassionate, patient, and diligent in anticipation of balance and a better future.
For more insights, download the fourth edition of the Salesforce.org Nonprofit Trends Report.
About the Author
Manager, Research Content at Salesforce.org