Why Should Nonprofits Consider Impact Reporting?

In the nonprofit world, every organization strives for change—change for a better world and change in the name of social good—and every nonprofit seeks donors who will support and donate to their causes. But in order to find those quality long-term donors that nonprofits look for, nonprofits need to understand that, in this day and age, donors need proof.

And this is why every nonprofit needs to understand and actively practice impact reporting.

Let’s talk first about what impact is. It’s an emerging term in the sector, and there seems to be confusion about what this means. While we don’t like to think that the nonprofit sector is a competitive sector, and we want to believe every nonprofit supports each other, the truth is that nonprofits are competing with each other for donations. With over 1.5 million nonprofits that exist in the U.S. alone, it’s inevitable. Donors need and want to see how nonprofits are creating change with the funds that they receive. Donors want to know where the money is going. Donors want metrics.