After months of the COVID-19 pandemic surging throughout the globe, extensive social distancing and limitations on public gatherings occurring, there appear to be reports and studies demonstrating that the curve may be flattening. Communities, businesses, and the public at large are anxious for plans to reemerge from this disruption to their personal and professional lives and for a return to a state of normalcy. The question that remains though is whether this notation of a return to normalcy is possible given the economic devastation caused by this pandemic, namely within the investment markets, record levels of unemployment, and overall financial deterioration of personal and business wealth, and continued uncertainty that remains. For the past several weeks, we have discussed various processes and procedures to help not-for-profits not only deal with the effects of COVID-19 on their current operations, but also how to adapt their planning and strategy for operating in this new environment going forward.
As the entire world seeks to reimagine itself post-coronavirus, not-for-profit organizations must continue to effectively demonstrate the vital role they play in today’s world and how their services benefit society. The not-for-profit sector provides much of what is most valuable in social services, arts and culture, recreation, education, and representation of its constituents. As such, long-term sustainability for these institutions and their programmatic missions is a necessity for many communities.
Not-for-profit organizations, like all businesses, should reflect on how this crisis has been managed thus far and focus on future strategic plans and frameworks to recalibrate themselves for what many believe will be a “new” normal.
A robust and flexible strategic plan is critical in enabling the advancement of a not-for-profit organization’s priorities and mission. Strategic plans should involve the ideas and thoughts of both management and board in order to gain mutual agreement on measurable goals, approved priorities, and a commitment to continuously review the strategies on an ongoing basis. Planning for the future involves carefully considering the various internal and external factors organizations must contend with on a daily basis, many of which are out of their control, and how to navigate them successfully. Some considerations for approved strategic plans may include whether the underlying assumptions are still correct, budgets are reasonable, societal changes (i.e., pandemics or natural disasters), or other matters that affect the overall landscape of the organization’s mission. Revisiting the plan periodically, making adjustments, and adapting the plan is generally a best practice. Strategic planning yields more organizational resilience because it allows management and governance the flexibility to pursue large-scale goals and impact while adjusting for challenges and opportunities.
During these times, it has become abundantly clear the value of systematic planning for worst-case scenarios to avoid unwelcome surprises. For-profit organizations are further along and have included some level of risk assessment or ERM as an essential component of their strategic plan. Unfortunately, the not-for-profit industry has been slower to adopt such formalizations of risk assessment or an established ERM plan. An ERM plan should be a proactive, multidimensional process of identifying, assessing, documenting, and preparing for potential negative outcomes. The goal of such assessment is to reduce business and reputational business impacts and aid the organization in meeting its goals and mission. As we can see from the effects of this global pandemic, risk and risk management planning, is vital to sustainability. The volatility of global economic conditions, coupled with emerging technology, and new compliance and regulatory challenges, further demonstrate the need for an ERM plan to mitigate risk.
Citrin Cooperman remains committed to ensuring we do our part to keep you up-to-date on the latest information available during these difficult times. Please reach out to your dedicated Citrin Cooperman Not-for-Profit Practice team at any time, as we are ready and able to assist you and your organization.