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Structure of a Nonprofit Organization

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    Board of Directors

    • A board of directors is responsible for the governing (or governance) of a nonprofit's mission and operations. The board states the nonprofit's mission, decides how it should be accomplished and establishes the nonprofit's internal policies, such as staffing and salaries. The nonprofit's executive director or president reports to the board. To run the nonprofit most effectively, boards are often broken down into committees overseeing a specific aspect of governing. For example, the board may have a budget and finance committee.

    Administration

    • The administration of a nonprofit sees to it that the nonprofit's common resources--such as technology and marketing--support each program's development and operations. Administration includes the executive director or president, and can include a vice president or director of development, vice president or director of marketing, and various assistant directors or staff, among others.

    Programs

    • Programs are the activities and services a nonprofit provides to meet its goals and carry out its mission. For example, a nonprofit with the mission of ending homelessness might have a program that helps people find jobs, as well as a program to help end addictions.

    Grants and Volunteers

    • Unlike businesses, nonprofits must rely mostly on grants and donations to do their work. Grants usually come from government or foundations, donations from individuals who may be able to take a tax deduction. Because of the workloads and tight budgets, nonprofits rely on volunteers, who contribute their time and skills, unpaid, to help the nonprofit do its work.

    Members

    • Although many nonprofits are run only by a board of directors, some nonprofits, such as trade associations, have members. Members usually pay some fee to join the organization. The membership elects the board and can vote to change the organization's bylaws--the document that guides how the nonprofit is managed.

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