Not-for-profit organizations are putting more emphasis on cutting costs as they face the prospect of donors giving them less, according to a new survey.
The annual survey, released Monday by BDO USA, found that only 44% of the 250 nonprofit executives polled reported an increase in revenue in the past 12 months compared to last year’s survey when 76% reported an increase in revenue. Reducing costs is a top priority for nonprofits due to the decline in giving, with 38% of the nonprofits executive respondents saying one of their top three priorities for the next 12 months is to cut costs.
Donors are also asking for more information from the organizations where they give money, with 50% of the nonprofit leaders polled saying donors are asking for more information related to fundraising outcomes data. Nonprofits are finding it hard to manage the rise in requests, with 82% pointing to a lack of adequate technology to gather information on impact.
Nonprofits said their top three priorities over the next 12 months are digital transformation (42%), reducing costs (38%), and seeking new sources of revenue/funding (36%).
“Nonprofits are facing economic uncertainty head-on and showcasing their determination amid a decline in giving and higher costs,” said Andrea Espinola Wilson, principal and co-leader of BDO’s Nonprofit & Education practice, in a statement. “Investing in their organization’s well-being can help them enhance mission delivery and expand their impact.”
Nearly all (99%) of the nonprofits surveyed say they meaningfully expanded or shifted the scope of their mission within the past 12 months, with 56% saying they had to meet the new needs of the populations they serve.
Environmental, social and governance information is part of the requested data from contributors, with just over half (51%) of the nonprofit executives polled saying funders and donors asked for more information about the organization’s overall ESG strategy and/or the degree to which ESG is ingrained in its growth strategy in the past 12 months.
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