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Nonprofit Executives Burning Out, Planning to Leave Jobs

(March 27, 2006) A survey of almost 2,000 nonprofit executives found that 75 percent are planning on leaving their jobs within five years, while another 10 percent are already in the process of switching job.

Daring to Lead 2006, conducted by CompassPoint Nonprofit Services and the Meyer Foundation, discovered a series of trends and perceptions that could create a potential leadership vacuum within the nonprofit sector in the coming years. However, most leaders indicated they planned on staying in the nonprofit sector at the time they were surveyed.

The survey found a strong correlation between executive director burnout and negative perceptions of the organization’s board of directors. While a majority (65 percent) felt personally supported by the board, most are not experiencing any sort of strategic partnership, nor do they feel challenged by their board.

The most important area where boards can improve? More than 70 percent of nonprofit leaders identified fundraising as the most critical area where boards can improve and help the executive and the organization. Most also expressed dissatisfaction with institutional funders and believe that grantmakers often make their jobs more difficult. Executives cited increased general operating support and multi-year grants as the two most important ways funders could help organizations and nonprofit leaders the most.

At the same time, executives also cited fundraising and finance as their least favorite aspects of the job and the areas in which they most needed to build their skills.

Another principal factor in executive burnout is concern about compensation, as most nonprofit leaders feel they are making significant financial sacrifices to lead their organizations. Women are twice as likely as men to lead nonprofits, yet lead less than half of all charities with budgets of more than $10 million. They also make less than their male counterparts in nonprofits of every size.

Can Nonprofits Fill the Leadership Gap?

A primary concern that arises from the study is if charities are able and have the resources to identify appropriate candidates for leadership and executive positions. According to data from the study, most small and mid-sized nonprofits lack the staffing depth to develop leaders from within their organizations. At the same time, competition for leaders and executives is increasing from the for-profit sector, and current executives believe that their successors will require significantly higher salaries, a critical challenge for many small and mid-sized organizations.

In addition, a large percentage of nonprofit leaders are white (82 percent), and younger executives are just as likely to be white as their older colleagues. Despite a growing diverse set of donors, newly higher executives are only slightly more likely to be people of color than the overall sample in the survey.

About the Survey

The Daring to Lead survey can be found online in PDF format at the CompassPoint website.

CompassPoint and the Meyer Foundation surveyed 1,932 nonprofit leaders from across the United States in the spring and summer of 2005, although hospitals, universities and large national organizations were not represented in the sample. In addition, the two organizations conducted seven focus groups as part of the research, six with nonprofit executives and one with board members.

CompassPoint Nonprofit Services is a consulting, research, and training organization providing nonprofits with management tools, strategies, and resources to lead change in their communities. With offices in San Francisco and Silicon Valley, CompassPoint works with community-based nonprofits in executive transition, planning, boards of directors, finance systems and business planning, fundraising and technology.

Established in 1944, the Meyer Foundation is one of the largest private foundations in Greater Washington. In 2005, the Meyer Foundation provided more than $8 million to nonprofit organizations working to strengthen communities throughout the Greater Washington region. The foundation supports leadership development through its Nonprofit Sector Fund, which was created in 1994.

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