Major corporations understand return on investment; they invest heavily in leadership mentoring programs. The effort can result in big returns like improved employee productivity and retention.
| Forbes reports: | |
|---|---|
| 84% | U.S. Fortune 500 companies have mentoring programs. |
| 90% | U.S. Fortune 250 companies have mentoring programs. |
| 96% | U.S. Fortune 100 companies have mentoring programs. |
| 100% | U.S. Fortune 50 companies have mentoring programs.1 |
These companies understand that leadership development is a key to maintaining institutional knowledge and gaining market advantage. This article will explore why it’s important for nonprofits to develop their next leaders and ways they can do it.
Nonprofit Turnover
The nonprofit sector has historically experienced high turnover rates, creating challenges for organizations trying to maintain consistency in service delivery and supporter relations. A 2023 report by Social Impact Architects shows the sector’s annual voluntary turnover rate is 19%, far above the all-industry rate of 12%.2 Nonprofits with annual gross receipts under $2 million fare even worse, with turnover rates nearing 25%.
Employee departures can lead to diminished productivity and heavy replacement costs.
While nonprofit leaders acknowledge the need to develop emerging leaders, few have taken action. The 2025 Forvis Mazars State of the Nonprofit Sector Report found that about 70% of organizations nationwide do not have a leadership mentoring program in place.
Passion has always been one of the main attractions to working at a nonprofit. Many young professionals enter the sector with a desire to “make a difference.” But that commitment can shrivel quickly if they:
- Hit a career ceiling with limited or no growth opportunities
- Experience burnout as they lack adequate mentoring
- See better growth opportunities in other sectors
- Feel undervalued or unrecognized for their contributions
Building a Leadership Development Program
Building a leadership development program requires activities that bring clarity to your organization’s preferences and needs.
Assess Your Current Condition & Needs
The first step in developing a program is to determine your organization’s current leadership strengths and weaknesses. Use a matrix to gauge which roles will likely need successors in the next five years, then assess your current team on their career aspirations.
Define What Leadership Means
Your organization’s needs are unique to your mission and goals, as well as your culture. Develop a list of the specific qualities your organization values in its leadership. In addition, define the core competencies that are critical for success, e.g., financial acumen, critical thinking, emotional intelligence, etc.
Identify Participants
Develop explicit criteria for program participation. Use recent performance evaluations and staff surveys to find suitable candidates. Keep in mind that some employees with potential may not fit traditional models, but through peer support and training could become strong performers.
Create Structure
When assigning mentors, take into account personality fit, learning styles, communication preferences, and specific areas of knowledge needed. Don’t assume leaders know how to mentor; training on effective mentoring practices will be necessary.
Match Mentors & Mentees
Establish goals for each participant, regular meeting times and dates, and discussion topics so that time together is structured and stays on track.
Measure Progress
Using feedback from mentors and mentees, track indicators of success to determine program effectiveness. Regularly assess and adapt to remain up to date with trends.
Resource Restraints
Funding programs and services is typically the highest priority for organizations; functions like mentoring and leadership development often take a back seat.
There are cost-effective ways for cash-strapped organizations to develop their leaders, including:
- Casual Chat – Start with simple coffee (or if you prefer, tea) chats. Once a month or so, set up 30- or 60-minute meetings between emerging leaders and senior leaders. This can help strengthen relationships, transfer knowledge, and provide support.
- Job Shadow – Let younger staff spend time observing leaders, cross-training them on various roles and departments within the organization.
- Lunch and Learn – Once a month or quarterly, have senior leaders present on topics they know well or have them discuss a leadership topic or specific challenges they confronted. This expands staff knowledge and inspires others to grow.
Many online platforms and companies offer free learning. LinkedIn,3 YouTube, edX, and others have extensive free courses on leadership, management, and other technical skills.
The Allstate Foundation offers free online training programs for nonprofit professionals through Northwestern University Kellogg School of Management’s Center for Nonprofit Management, all at no cost to them or their organizations.4
Forvis Mazars offers complimentary articles and webinars.
Regardless of which method you choose, keep in mind that leadership development is not a one-time event, but rather an ongoing investment into your organization’s future.
The costs associated with operating a leadership development program may seem high, but consider the costs of not having one: repeated mistakes from lack of institutional knowledge, inconsistent program delivery, disrupted relationships with supporters, burned-out employees, and high leader turnover.
How Forvis Mazars Can Help
Forvis Mazars understands your challenges, offering tailored assurance, tax, and consulting services for nonprofits. If you have any questions or need assistance, please contact one of our professionals.
- 1“Does Mentoring Still Matter for Fortune 500 Companies?” forbes.com, May 19, 2022.
- 2“Why Employee Turnover Should be a Key Metric for the Social Sector – Our Collective Canary in the Coal Mine,” socialimpactarchitects.com, August 23, 2023.
- 3Linkedin.com/learning.
- 4“Nonprofit Leadership Center,” allstatecorporation.com.