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Top 4 Nonprofit Trends for 2024: Cybersecurity, Employee Retention, Funding Challenges, and Election Year Strategies

July 08, 2024

We sat down with Sandy Ross, Partner and Nonprofit Practice Group Leader to find out what challenges nonprofit leaders are facing as of late and how they’re coping…Here are her top insights.

Several trends are dominating 2024 in the nonprofit industry. What are nonprofit leaders facing in light of ongoing employee shortages, cybersecurity concerns and the upcoming election? From fundraising strategies to donor engagement, join us as we explore top trends.

What is top of mind with nonprofit leaders today?

Data breach preparedness: “Nonprofits face so many risks when it comes to cybersecurity, and many do not understand the impact of a breach. Sure, funding risks are a concern, but cyber concerns are enough to keep you up at night as a cyber breach impacts EVERYONE at the organization.”

How can nonprofit leaders mitigate the risk of a breach?

“I have found that the coverage many organizations have in place barely covers the cost to get the organization back up and running post breach. Prioritizing the right coverage will be paramount as organizations look to protect their assets in 2024 and beyond.”

Employee Retention challenges- “The labor shortage continues to be a challenge, making it more crucial than ever for organizations to prioritize training and development for their teams in 2024 and beyond.”

What strategies are organizations utilizing to retain employees?

“Take a closer look at your benefit package. What are your competitors paying? How can you engage your team with your mission?

Many organizations are going outside the country to attract talent since the talent pool is decreasing, and lots of organizations are turning to remote workers.

There are several considerations organizations should factor in when it comes to reporting and form 990. The reporting requirements are SIGNIFICANT when it comes to this.”

Finding Revenue sources to replace federal relief funding- “Since COVID has ended, organizations are having significant difficulties replacing federal relief funding from Paycheck Protection Program (PPP), Employee Retention Credit (ERC), and the American Rescue Plan Act (ARPA.)

Reimbursement rates are not rising at the rate of labor increases and inflation, making it difficult for organizations to sustain programs.”

How can organizations cope?

"In light of the loss of federal relief funding post-COVID, nonprofits should continue to diversify funding sources, strengthen donor relationships, enhance fundraising efforts, optimize operations, advocate for support, build a strong reserve, innovate programs, and engage volunteers."

Lobbying Considerations during 2024 Election Season

“2024 is an election year, and that means that nonprofits need to refresh their understanding of election-year issues for organizations that want to remain exempt under Internal Revenue Code Section 501(c)(3).”

As a refresher, lobbying is generally defined as any attempt to influence legislation through communication with a member or employee of a legislative body, which is allowable within certain limitations.

How can nonprofit leaders ensure that their tax exempt status is safe?

“There are lots of reporting requirements to factor in and several barriers for nonprofits related to elections. Making a one-time election by filing Form 5768 allows organizations to have their lobbying efforts evaluated under Section 501(h), providing clearer guidelines and potentially higher allowable lobbying thresholds.

Do you need guidance tackling these issues? Sandy and the Nonprofit Team can help. Reach out to us today.

Sandy is a nonprofit business advisor and Partner at KLR. With over 20 years of experience in nonprofit financial management and compliance, Sandy is your go-to resource for all things related to budgeting, grant management, and strategic planning. But she's not just about numbers—Sandy's heart is in helping nonprofits thrive.

Beyond her professional role, Sandy is a passionate volunteer, dedicating her time and expertise to support various charitable causes. She's on a mission to empower nonprofits to achieve their goals, providing tailored financial solutions that drive organizational success and make a real impact.

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