When should a nonprofit hire a consultant?

Most organizations need to retain a consultant from time to time to help either board members or staff members with their respective duties. Even if board members could do the task as well, the politics of some situations, or the lack of time to focus on the task, might suggest the need for one or more consultants. To avoid additional conflicts of interest, use the consultant as an outside hired expert; don’t elect him or her to serve on the board if you plan to use his or her services on a contractual basis.

Many lawyers, accountants, and other types of consultants specialize in the nonprofit sector. They bring specialized skill, as well as experience and a network of contacts gained from working with other nonprofits. Perhaps most important, they are objective, outside observers, with no vested interests in your organization. That enables them to provide frank feedback and a fresh perspective on the situation. The information and ideas they offer can help your organization long after the consulting period has ended.

Consider retaining an outside consultant to assist the board with

Strategic planning

A search for a new chief executive

A comprehensive fundraising program or capital campaign

Monitoring of trends or legislation that could have an effect on future strategies

Preventive legal services, legal audits, and legal defense

Accounting systems, financial audits, and investment strategies

SUQQESTED ACTION STEPS

1. Board members, consider whether the full board could benefit from outside counsel. Think in terms of the value received in light of your mission and total budget.

2. Chief executive, look into sharing a consultant (and the accompanying expenses) with another nonprofit organization.