A Story We Hear
Nonprofits have great intentions at inception and the causes they support are worthy. The majority of 501(c)(3) tax exempt corporations don’t ever get past the hand to mouth existence stage, and yet through the efforts of committed leaders and their supporters there are now thousands of nonprofit corporations in the United States. Many have raised enough funds to start looking at endowing their cause in perpetuity.
All corporate officers and directors are held to fiduciary standards. In both the for profit and nonprofit category the exposure for not living up to these standards rises as the balance sheet of the entity grows. The specific issue we have noticed for nonprofit boards is the common problem of personnel turnover often leaves the endowment fund management overlooked and misallocated.
In addition to fiduciary standards, the officers and directors of a 501(c)(3) are held accountable by the state and federal governments. Government regulation and compliance can change in subtle ways each year which can cause the well-meaning board to be out of compliance as they focus on their righteous mission. No matter how worthy the cause, the bigger the nonprofit the more in tune the leaders must be to staying aligned with the laws that afford them tax exempt status.
What are the top issues facing nonprofit boards today?
DLK Board Member Process
Create an Investment Policy Statement (IPS)
Investment Management Process Education and Implementation
Board Member Attrition Plan
Putting it all together
The nonprofit entity that is growing and positively
impacting the causes it cares so much about can be a
contagious place for many. As the officers and board
members struggle to maintain the integrity of their core
cause along with dealing with issues such as staff
turnover, it is helpful to have an outside advisor who
can keep the team on track with the creation and
curation of an appropriate IPS.
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