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Running a charity in today’s modern business world can be very problematic, as can achieving positive and long-term financial strength. However, despite all the complex issues which need to be overcome, it is of course, very rewarding. Here are some of the challenges facing NFPs today.

Governance issues

Governance can be a very large issue for NFPs. A nonprofit is entirely different from a for-profit business as the board, CEO and stakeholders need to be taken into account for every decision that is made. And then there are the government rules and regulations on top of that. Unlike a for-profit organisation, the board members have a large say in what goes on. A trustee has the huge task of catering to every demand and is personally liable for every decision and action they take.

Sourcing talent

To be the best at what you do, you need the best team members to help you achieve it. But this can be hard from a non-profit’s perspective, particularly with low budgets and high salary expectations. Mentoring top talent can take time and money. And as many staff come to nonprofits with very little experience and then leave once they have developed their skills, it can be very difficult to retain them for the long-term.

New NFPs can struggle

As new NFPs enter the marketplace, it can be a struggle for them to keep up with the more established and larger sized charities. It can be difficult for them to take risks and they don’t have the reputation to gain the support of donors and supporters. Until they grow, small NFPs can experience many frustrations, and many often close before they are even given a chance to succeed properly.

Educating the public

Charities have changed a lot over the years, and for the most part, the general public isn’t even aware of what a charity represents. They are unsure as to who is paid and unpaid and overestimate how much money goes into issues such as fundraising and administration. Education needs to be a big part in leading the way for change in this area.

Demonstrating impact

While there is a lot in the news about charities – which ones are actually succeeding in their goals? Which charity is doing a great job? And how are they representing their success to the general public? Demonstrating your impact in a successful way is one of the best ways you can increase your donations and support. But achieving that successfully can be one of the biggest issues any charity can face.

This list is not necessarily exhaustive but as you move forward, it is important to note that transparency and communication are a great way to overcome these and many other issues that your NFP may come across.

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