New Study Says Nearly Half the Leaders of NYC's Nonprofit Agencies to Retire in Five Years

10/23/2003

From: Jeanette Brown of United Way of New York City, 212-251-2473 or 516-672-0221 (mobile)

NEW YORK, Oct. 23 -- United Way of New York City today announced the findings of a two-year study that found that 45 percent of current Executive Directors of New York City nonprofits will retire in five years. The findings were presented by Baruch College School of Public Affairs at United Way's Leadership Development and Succession Management Conference, which was attended by 180 Executive Directors, nonprofit board members, funders, and consulting firms.

The study was jointly funded by United Way of New York City and The Clark Foundation. It will be available online at http://www.unitedwaynyc.org after 1 p.m. on October 23.

United Way of New York City commissioned the study when it became concerned about anecdotal reports that many of New York's senior nonprofit leaders were on the verge of retirement and wanted to formulate a response to the needs of emerging leadership. On average, current leaders have remained in the field for 15-20 years.

"Once we saw the results and realized we are witnessing a huge transition, the issue became 'Who are the next generation of leaders, what skill sets will they need, and how are we handling succession planning?" said Lawrence Mandell, chief executive and president-elect at United Way of New York City. "We knew we needed to do something to ensure there will be a next generation ready to lead. United Way has done a lot of investing in building capacity, but we weren't putting forth a similar effort for nonprofit staff. That is changing."

As a result of the findings, United Way today established its first Leadership Fellows programs to train the next generation of nonprofit leaders. Two programs will be offered, for senior and junior fellows. The senior fellows program will begin in January 2004, while the Junior Fellows program is set to begin in March 2004. Both will be given at Baruch, and tuition will be paid by United Way. The students' nonprofit organizations will be responsible for paying for books and other school fees. Applicants will be responsible for the $50 application fee. Applications for the senior fellows program were made available at the conference; they will be due by November 25. Applicants must be nominated by their organizations.

"This program is unique in that it emanates directly out of the research. We're creating a program based on what the field has told us they need," added Mandell.

David Birdsell, executive director of academic programs at Baruch and one of the co-authors of the study, added, "There is a need for this kind of professional development, which is accessible to everyone in the nonprofit sector who needs it. Until now, there has been limited preparation for the next generation of nonprofit leaders."

In addition, United Way will create an advisory council of volunteers who will aid in the development of programs that address volunteer and professional leadership development within the nonprofit sector.

Additional findings:

-- More than half of Executive Directors and future prospective leaders reported that their organization did not currently have professional development programs (57 percent and 54 percent). Even fewer nonprofits have a succession plan for executive leadership.

-- One third of Executive Directors said their organizations had a succession plan while only a quarter of future prospective leaders reported succession planning in their organizations (with 13 percent reporting that they did not know if their organization had a plan).

-- Respondents gave five reasons for lack of professional training: cost, service obligations, difficulty in finding appropriate training, contract requirements and the perceived threat to employee retention.

Sustaining the Health of the Nonprofit Sector: One of United Way's Action Areas

United Way of New York City's Leadership Fellows Program is an integral part of United Way's Community Action Strategy, wherein the organization has identified five key priorities or "action areas" on which to devote its resources. Strengthening New York City nonprofits is one of the five core areas. For more than 30 years, United Way has helped strengthen the nonprofit community through a strategic combination of technical and management assistance, program development, volunteer recruitment and technology equipment and training, as well as its board training, recruitment and placement program known as Linkages.

In the last four years alone, United Way's Management Assistance Program has allocated $4.8 million to help some 200 New York City nonprofits strengthen and build their management, financial, technological and leadership capacities. Since 1985, approximately 1,100 candidates have been through MAP's Linkages board training program, resulting in hundreds of board members successfully placed in dozens of neighborhood agencies throughout the city.

About the Research Sampling

The finding was based on input collected by Baruch during focus groups in Spring 2002 and a follow-up phone survey in Spring 2003 conducted with nearly 900 United Way grantee organizations in New York City. Maximum error margin for the 314 Executive Directors sampled is plus/minus 3.3 percent and the maximum error margin for the 295 future prospective leaders is plus/minus 5.7 percent.

About United Way of New York City

United Way of New York City is dedicated to helping the City's most vulnerable citizens become and remain self-sufficient. We work by bringing together partners and resources to tackle health and human care problems in five critical Action Areas: hunger and homelessness solutions; access to health care; education and early childhood development; workforce development; and the overall health of the nonprofit sector. Working side-by-side with local nonprofits, businesses and government, we lead strategies to improve the quality of life for New York's neediest. Through our management assistance, volunteer and technology outreach programs, we build the capacity of nonprofit agencies to deliver results. We set goals and measure and report progress in each of our Action Areas. United Way of New York City is independently operated and governed by local volunteers. For more information on United Way of New York City, please visit http://www.unitedwaynyc.org.