Nonprofit Transparency: Open For Scrutiny
Donor Trust
The old adage People do business with People they know and trust can be easily translated to “œpeople donate to nonprofits they know and trust.”
And trust can be a little challenging with constant news headlines about scams involving both for-profits and nonprofits.
The New York Times reported that nonprofits lose billions from theft - usually from employees. Clearly better internal controls are needed probably by most nonprofit organizations. Check out this report from Sage Software, Special Report: Legislation, Enforcement, Fraud, and Donor Skepticism: Four reasons why greater transparency is critical in the public sector
Minimum Website Requirements
It’s no wonder that donors are skeptical. In addition to re-evaluating your internal controls, here are some quick ways to update your webwsite with items that will help donors feel more secure about your organization.
- 1. Board members listed with board titles and affiliations – I know those board members can be shy folks but an important board responsibility is to help promote the organization, and there is no better way to do it than by telling everyone they know that they are on your board AND showing their smiling faces with photos!
2. An annual report - EVERY nonprofit should have one (even smaller nonprofits should put together a mini report in a pdf format). The annual report showcases your program accomplishments and financials. At the VERY LEAST, place on your website a pie chart showing where your expenses are going, broken out by individual programs and administrative dollars.
3. A link to your latest Form 990 and IRS Determination letter - if you or your board feels uncomfortable posting these online, you should evaluate what the core problem is and maybe there needs to be some major changes in the way you operate. You’ll be handing out that Form 990 to donors and they won’t be thinking anything different than the general public.
4. Affiliations, Collaborations, Partners, and Business Enterprises - if your nonprofit is doing business under another name, running a business enterprise, collaborating with other nonprofits or for-profits, be up front about it. I’ve seen people start multiple nonprofits or a nonprofit related to a for-profit and purposely kept it hidden (not listing board members – which would show the interconnection). If everything is on the up and up , there should be no reason not to show your connections.
5. Full contact information - it’s important to show your full mailing address, phone number AND email address. If you run the nonprofit out of your home, set up a PO box to use. Don’t let IT people try to tell you that you need a form instead of an email address. there are many ways to spam-proof the email addresses on your website without using a form. Most people don’t like filling out forms to be contacted and you may lose potential communications that way.Related Articles:
Marketing in the New Economy – The top 3 things every nonprofit should know
The Nonprofit Funding Stimulus Package – The top 3 marketing tools that will help you generate income in this economy

