Your Annual Report is Missing Something

Annual reports generally follow the same formula. It’s a formula we have written about extensively. And there’s a great reason that annual reports follow that formula.

Because it works.

And yet, most annual reports are missing a critical element. In order to include this must-have, we in the nonprofit sector need to step out of our comfort zone.

Typically, annual reports begin with an opening salvo and a letter from the executive director, board chair, or both. The report then shares stories, lists programs, honors donors, and ends with a request for further support. I know this because Mission Minded has created many, many annual reports over the years, including award-winning work on behalf of the Sierra Club, San Francisco AIDS Foundation, and this stunning piece for Khan Academy.

These reports work. They help donors feel valued and connected, and the reports help establish relationships with new program supporters. But for most organizations, including some of our own clients, this model misses a critical element: vulnerability.

We need to show our vulnerability, and the perfect place to do so is in an annual report.

Most organizations are practiced in highlighting their strengths, but we flounder when we talk about the work we’ve left undone. A compelling annual report doesn’t just applaud success; it acknowledges the continued challenges and the opportunities that those challenges set before us.

Are you willing to be open about where your organization is weak, lacking, or in need? You may highlight your accomplishments with panache, but can you also reveal where your efforts fall short?

In our Minute Message Model, we teach nonprofit leaders to improve their communication by talking about the challenges they face before they address how they enact solutions. We encourage them to establish the WHY before discussing the HOW. In practice, that formula might look something like this:

There’s a problem in our community. There are 50,000 students who don’t have access to high-quality, engaging after-school care. XX Organization provides that care, giving kids a place to go where they can learn, play, and grow. 

That’s pretty solid, but imagine how much stronger this piece of communication would be if it included an honest assessment of how the organization has fallen short of meeting the need.

There are 50,000 students who lack access to high-quality, engaging after-school care. We provide that care, but even in 2018, our best year yet, we only extended support to 5 out of every 10 of those kids. We raise and spend $1,000,000 every year to provide kids with a safe, nurturing place to go. Our program works, but responding to existing—and growing—need requires that we work twice as hard and that our community contributes twice as much. We need you, but we also need your friends, relatives, and neighbors to join in answering our call.

It’s an odd paradox, but being more explicit about where you fall short creates an opportunity for others to see how important they are to your success. It’s that feeling of importance—that emotional engagement—that spurs people to act. Vulnerability creates an opening for others to lend their time, money, and talents to solving the problem you’re working on together.

Use your annual report to reflect not only on your successes, but also to show where you fell short. Doing this can feel risky and uncomfortable but it can ultimately lead to much more expansive opportunities and success on a grander scale.

Are you up to the challenge?