Complete iDeals Board Portal Overview for 2024

As the guardians of charities the board members of nonprofit organizations must be proactive in evaluating and mitigate the risk. A risk assessment will help you assess and rank the risks of your company, based on the likelihood that they will occur and their impact on operations. You can then build the risk register or scenario planning to help you determine the best way to manage your risks and make educated decisions about reducing, avoiding or eliminating them.

Non-profits face unique challenges when it comes to assessing and managing risks. While for-profit businesses face similar issues, such as employee training and the reduction of liability, nonprofits must be aware of the importance of protecting the contributions of donors in both time and money. This means that the risks of data breaches, financial shortages, and political instability are as relevant for nonprofits as they are for businesses that are for profit.

This article outlines a three-step process that will help your organization move from reactive to proactive, safeguarding your mission for the long run. Whatever the size of your nonprofit or level of expertise, the basic steps are the same.

Begin by identifying the risks that your organization is exposed to. This can include everything from a decreasing reserve ratio to how your staff manages their passwords. During this time it is important to not let any department go unnoticed that includes finance and accounting; IT and donor relations, engineering human resource management, and public relations. Consider how a negative incident could affect each of these areas. This includes costs, schedules and projects as well as long-term campaigns. Then, assess the probability of each risk and determine how much damage it could cause if it happens.