While leaders of nonprofits are certainly dedicated to a worthy cause, gaps in financial literacy are leading to growing racial disparities among leadership in the groups.
The Midwest Financial Firm, IFFis focused on educating leaders of color in nonprofits about the financial barriers they could face. They call it the Stronger Nonprofit Initiative.
“The main purpose is to empower those nonprofit organizations led by people of color to better equip them to overcome some of the barriers they run up against throughout the years,” Darian Luckett, Director of Lending for Wisconsin and Iowa at IFF said. “To access the type of resources they need to grow and to access fair capital.” Luckett says IFF serves nonprofit leaders of color in Wisconsin, Illinois and Michigan. One of which is right here in Milwaukee. “When it comes to many of our nonprofit leaders, many of us come to this with a passion to improve the community,” Keith Stanley, Executive Director of Near Westside Partners said. “Most of us don’t have that financial background. We’re not accountants. Some of us even struggled in college when it comes to that.”
IFF focuses on leaders of color because they face a disparity in financial literacy. AGeorge Washington University studysays African Americans answered 38 percent of financial literacy questions correctly, compared to 55 percent of white adults. That was dealing with personal finances. Stanley says it’s much different when you add a few more commas to a budget dealing with hundreds of thousands, if not millions of dollars. “How paperwork works, financial statements and how to read them,” Stanley said. “IFF is doing an excellent job bringing together people from across the country to understand what paperwork looks like. What does it mean for an organization when we need to do more fundraising? When there is a deficit, when we have an overage, what does that look like? Budgeting, what does that look like? All of that stuff is important for us because, as we continue to grow, to help solve some of the many unique problems and challenges we have in the City of Milwaukee, we can grow and our funders and community are confident in the work we’re doing.”
It allows Stanley to focus on the work he’s passionate about instead of being bogged down by the numbers. He’s able to better communicate with the folks in accounting and bookkeeping so he spends less time on that and more time on doing good in the community. “We’re able to speak the same language,” Stanley said. “Once we’re able to speak the same language, it makes it easier, more efficient and effective for us to run through the program to get things done with the nonprofit.”
Increasing racial diversity among nonprofit leadership