Many not for profit organizations rely on volunteers to deliver services but because they are not paid their contributions don’t show up on the financial statements. The costs of volunteer management are included but the benefits gained from volunteers is not. The standard financial statements omit many things which are critical to showing how an organization is meeting it’s mission. What gets measured get attention and is considered to have value but because volunteer contributions are not measured their importance is often undervalued by the organization and its stakeholders.
The first step in recognizing volunteer contributions is identifying the type of volunteers you have in your organization. Many us will think immediately of the program volunteers who make up the largest portion of the volunteer time. However you probably have other volunteers that you forget about including. Think about people who volunteer to help out on special events or other fundraising campaigns and don’t forget your board members who are all volunteers.
Once you have identified who your volunteers are you will need to calculate the hours contributed. For organizations that are not already doing this there is free software that will help not only track volunteer hours but assist you with scheduling and calculating the value of your volunteer contributions. Check out www.volunteerscount.net . Registration is free so its worth taking advantage of the resource.
Once you identify the categories of volunteers and have collected the time you will need to assign an hourly rate to the hours worked. This is the part that gets somewhat more complex. Some volunteer positions will be valued at a higher rate than others. Volunteers at fundraising events may be valued at minimum wage. For some positions you could use the rate you would pay if they were hired as employees. Calculating a rate for board members may be the most difficult. Some of your board members may be provided expertise that would be very expensive to purchase while other board members, while are just as important to your organization, could not be justified at the same rate. It may be easiest to use a blended rate for everyone on the board. There are different ways to come up with an hourly rate and whichever method you choose should make sense for your organization and the position. It’s also important to document how you calculate the rates if someone were to ask you to justify your numbers.
You may be surprised to see the final total value of all volunteer contributions. In some organizations it can represent a significant portion of all hours worked within the organization as well as a significant portion of the total operational budget. While this does not appear on your audited statements it can be very useful to include this in reporting to external stakeholders. Your annual report is a good place to start sharing this information. It can also be very helpful to include in funding proposals.
Including the value of volunteer contributions provides a more complete picture of the operations of the organization. It demonstrates the value of volunteers to the organization, community and policy makers. It can also help make the case for the funding of volunteer management and the importance of volunteer management. There are many aspects of your impact on the people and community you work with that you are probably not measuring. This is only a first step but an important one. Once you have volunteer value accounted for you can start working on some more complex issues of measuring impact.