When was the last time you enjoyed creating an annual report for your nonprofit organization?
For most organizations—nonprofit or for-profit—annual reporting can feel like a massive drag. You must gather information from all your departments and programs, collating details on activities, populations served, outcomes, and more. And, except for financial materials like audits and tax returns, the bulk of the work of annual reporting is optional.
No one requires nonprofits or businesses to compile glossy annual reports. Plus, annual reports take a lot of time and resources to create.
So, do you really need an annual report for your organization?
What Makes a Good Nonprofit Annual Report?
An effective nonprofit annual report both informs and inspires readers. They walk away invigorated by your vision and impressed by the impact you’ve created.
That means a nonprofit annual report can’t simply be a list of activities over a single year. Instead, your report should convey what your organization does and why, what you accomplished over the past year, and where you’ll be focusing your energy in the year ahead. Think of an annual report as a souped-up version of your best grant reports.
Someone engaging with your annual report report should see if and how their interests align with your work—and how they can get involved.
Sounds great, right? However, an annual report is not the only place you should be communicating these things clearly with your audiences.
Your website, newsletter, printed materials, social presence, grant reports, and grant proposals are all part of sharing the story of what you do and why it matters. If you’re consistent across these materials, then annual reporting actually becomes much easier.
How to Make Nonprofit Annual Reporting Easier
Focus on impact.
When recapping accomplishments, many of us get caught up in detailing activities. Yes, activities are important, but pretty quickly you end up with a long list of “stuff we did” rather than “change we created.” That’s why we recommend focusing on impact: What is different today as a result of your work over the last year?
Tell a story or two.
Storytelling is one of the most powerful ways to connect with audiences. If you work directly with individuals, such as a direct service nonprofit or a medical facility, then client stories are a must-have. Showing how one person’s life was improved as a result of your work helps audiences envision that change on an even larger scale.
Don’t include every activity.
Let’s be honest: lists of activities are boring to read. Instead, share compelling examples of activities that were key to achieving your goals. This helps audiences start to connect the day-to-day of your work to the impact you create.
Experiment with format.
Not every annual report has to be a 30-page, professionally printed document! We’ve seen annual reports in the form of well-designed emails, PDFs, short brochures, micro-sites, videos, slide decks, and more. The key is knowing how your target audience wants to engage with your content. For example, if you are a membership organization and most of your members renew by mail (after ignoring multiple email reminders), then a printed and mailed report might be right for you.
Make it multipurpose.
The magic of an annual report is that you are organizing information about your organization in a way that is concise and impact focused. That same content can then be used across your communications platforms. For example, you might use your annual report content to refresh your website or share excerpts on LinkedIn. For nonprofits, your annual report can serve as a template for many upcoming grant reports, saving you time in the long run.
Include a look-ahead.
Your audience doesn’t just want to know what you’ve done, they want to be inspired by what you envision ahead. If you have new programs you’re developing or expanding, share that! If you’re going to be undertaking a strategic planning process in the new year, let folks know!
Annual Report, Yes or No?
For us here at Funding for Good, we’re less about “annual” reporting and more about impact reporting. We counsel our clients to regularly communicate with donors, customers, clients, stakeholders, and the public about the demonstrable impact they are creating.
If you’re creating and sharing quarterly impact reports, then an annual report is just an expanded version of those materials. But if you’re not sharing regular updates with anyone, it’s time to get started!
For more resources on measuring and communicating about your impact, check out our on-demand training, The Measure of Success.
