The Non-Profit Quarterly Report = Transparency

I just read Jonathan Schwartz’s blog (CEO, Sun Microsystems) and I’m blown away.  In his post of October 30, 2008, he reviews and explains the highs and lows of the past quarter. He addresses the obvious stakeholder questions: why were gross margins lower, what were the highlights and lowlights, and basic concerns he’s hearing from customers. We can get some of this information from Investor Relations, and others from the quarterly reports. But what Jonathan is doing is truly fantastic: he’s letting in stakeholders to company issues, and because it is in blog form, asking them to discuss the good and the bad. In this post, he is

  • Actively listening to his stakeholders (he lists customer concerns this quarter)
  • Respecting the stakeholder by being transparent, honest and accessible
  • Offering valuable insight into the workings of the corporation
  • Beginning a discussion (readers can respond with comments to Jonathan via the blog post. Oh, and they did!)

I love the idea of the transparent quarterly report. How can we extrapolate this to non-profit organization?

There are risks to non-profit quarterly (public) reports: it is risky to reveal the financial situation of a non-profit to its funders/stakeholders, it is risky to share funding sources with others (who may poach them), and it is doubly hard to admit when programs or campaigns fail to reach their goals (as this could affect future funding).  How can non-profits offer a public quarterly report and still keep all the funders happy?

  • Use this opportunity to write about the highlights, lowlights and customer/client/funder concerns of the past quarter. You have the opportunity to honestly give a “state of the non-profit” to those who have a vested interest in its success.
  • Assess the programmatic ROI each quarter. Where is the greatest return on investment? Highlight a great return and thank the foundation/donor publicly on the blog. If they are currently funding you, this can help secure your funding stream.
  • Offer other funding opportunities in the program report: note what more resources would enable the organization to do on top of its current outcomes.
  • Being honest about potential shortfalls in outcomes is critical for transparency. If your job training program had low enrollment, talk about that, and address potential stakeholder and funder concerns. Head off a possible breach of the relationship by pulling the funders and other stakeholders into the conversation and alerting them at the earliest possible times. Ask them for comments to the blog.
  • Offer next quarter’s predictions. What will be the challenges the organization will face? Outcomes hopefully completed? Upcoming activities?

Invite comments. Get ideas, feedback on the report, and integrate them into the organization’s work. Let me know if you institute a non-profit quarterly report, and the feedback that you get from your stakeholders.
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