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From the President's Office, December 2008

Dear Friend:

Usually at this time of year we are in the middle of the hustle and bustle of the "Giving Season," a time when many nonprofits receive the majority of their donations, and are wistfully looking forward to some free time when we can reflect on the activities of the past year and craft our goals for the coming year.

But this year, we have a new concern—the global financial meltdown and the impact it will have on the nonprofit sector. I have been telling reporters that it is too early to tell if nonprofits will be adversely affected this year. It seems unlikely that we won't. In our last issue we reported that our latest survey had found that nearly half of nonprofits that rely on end-of-year contributions expect donations to decline during the 2008 giving season.

On the other hand, our friends at the Giving USA Foundation have been reminding us that donations continue to increase year after year, even in bad times, and I certainly believe we should never underestimate the generosity of Americans.

At the moment, though, this downturn appears different from others we have experienced in our lifetime. It seems deeper and more widespread, affecting every aspect of our economy. It feels as if some fundamental beliefs about government, regulation, and many of our institutions may forever be changed.

We should assume that events this transformative will not leave the nonprofit sector untouched. Three thoughts come to mind:

  1. The push for transparency and accountability will pick up speed. With fewer dollars available to support nonprofit activity, individual, corporate, and foundation donors will be under increased pressure to invest their money wisely, in organizations doing the best work and having the highest impact. Transparency is already a given for most donors. Now the demand for demonstrating and measuring effectiveness will move front and center.
  2. Coupled with the move to effectiveness, we're likely to see more nonprofits considering new ways to operate more efficiently. We'll need to challenge our assumptions about how we deliver services. There will be increased emphasis on mergers, partnerships, and outsourcing. We'll be challenged to justify our way of doing things like never before.
  3. Finally, these challenges to our sector offer exciting opportunities for rebirth. The needs of our society are significantly different from what they were when many of our organizations were created. How can we redesign ourselves to be more responsive to today's world? This new opportunity to break old habits and structures, coupled with a recommitment to public service inspired by the Obama administration, leads me to believe that 2009 could become one of the most important years ever in the history of the nonprofit sector, increasing our roles, responsibilities, and impact in American society.

As always, I thank you for your hard work and commitment to the nonprofit sector. I hope GuideStar has been of help to you in your work. We look forward to serving you in the year ahead and wish all of you success as we enter a challenging time for our organizations and the people we serve.

I'd like to close with a thought from Franklin D. Roosevelt's first inaugural address. I find these words as inspiring today as they must have been to an America in the grips of the Great Depression in 1933:

Happiness lies not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. The joy and moral stimulation of work no longer must be forgotten in the mad chase of evanescent profits. These dark days will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves and to our fellow men.

Bob Ottenhoff
President and CEO

Topics: Economy