From the Archives: Navigating Nonprofit Holiday Parties

From time to time, we share previous content that has enduring significance for nonprofit organizations. The following blog post was originally published on 12/7/16 and has been lightly refreshed.

Strings of festive lights.

It’s no secret that the finances of nonprofit organizations often come under intense scrutiny from potential donors. When a donor is considering contributing to your organization, they want to be sure that their money will be used wisely. Unfortunately, as the ongoing "overhead" debate demonstrates, expenses that are necessary to the productivity and longevity of your organization can sometimes been perceived as frivolous or nonessential by donors.

Holiday parties are one of those expenses that should be approached carefully by your organization. While you might think it’s a great idea to reward your hard-working staff with a festive celebration, it’s also something that could raise a potential red flag with donors. No one wants to think their money is being spent on wild office parties.

So how can you reward your employees while still maintaining responsibility to your donors? First of all, if a holiday party really isn’t in the cards, communicate this to your staff. Nonprofit staff are dedicated to their jobs because they believe in the organization’s mission - not because they’re expecting a big party at the end of the year. Think about free or low-cost ways to show your gratitude, like an office potluck or thoughtful hand-written cards.

If you choose to host a nonprofit holiday party, perhaps you could also invite board members, donors, or volunteers. This could be a great way say thank you to all the other individuals who make your mission possible. You could even make it a low-key fundraising event! But be sure to keep it simple - you don’t want this “reward” to turn into even more work for your staff.

You could also think about extending your holiday party into a productive mini-retreat. By combining social activities with professional development and holiday-themed team-building exercises, you might find that you can have some festive fun and improve workplace relationships at the same time.

If you're contemplating a nonprofit holiday party this year, we encourage you to consult your accountant and open the lines of communication with your board and donors. There are many financial pitfalls that nonprofits must navigate when it comes to holiday parties. With proper preparation, you can keep your harmless fun from turning into a big headache.