For nonprofits and social impact organizations, today’s funding landscape doesn’t look anything like it used to. Traditionally consistent sources of revenue are drying up or becoming less reliable. Meanwhile, the expectations haven’t stopped: Every day, nonprofits are being asked to stretch limited resources further.
As Kellogg School of Management Clinical Assistant Professor and Director of Northwestern’s Golub Capital Board Fellows Program Allison Henry points out, nonprofits and social impact organizations have typically been able to count on four revenue streams:
- Government funding
- Corporate giving and sponsorships
- Individual gifts
- Earned revenue from programs, services, and/or events
But that mix has shifted recently (and dramatically).
Government funding is increasingly unpredictable (sometimes nonexistent); at the same time, corporations are pulling back on financial contributions to avoid real or perceived conflicts with federal policy.
“That leaves nonprofits with two streams: individual giving and earned revenue,” explains Henry. “While dollars from individual donations have been going up, the total number of donors has gone down. This is forcing a focus on major gifts from individual donors in hopes of making up for those gaps.”
But economic uncertainty and concerns about a recession make this reliance on a smaller pool of individual donors risky.
The bottom line: Nonprofit leaders are having to rethink how they sustain their missions and respond to a new reality.
Building Resilience Amid Funding Uncertainty in 2026
While 2025 was a year of crisis assessment and response, Henry anticipates that 2026 will focus on building proactive, flexible plans that adapt to waves of change.
In many ways, success in this next phase of work will come down to the capabilities of development directors and executive directors as they identify tactics to activate their boards for fundraising.
“There’s a whole cycle of donor cultivation that’s often overlooked,” Henry points out. “As a board member, you can cultivate a relationship with a potential donor by taking them out for lunch and describing why you’re excited about the organization you’re serving. To help steward a relationship, you can write a thank-you note to someone who’s already given. There are so many ways to support fundraising beyond the ‘ask’ itself. Development and executive directors can help board members understand how to play an important and active role.”
What Today’s Nonprofit Leaders Need to Navigate
To be effective, Henry points to three areas that today’s nonprofit leaders must understand:
- How organizations are designed
- How culture shows up
- How power and politics shape decisions and outcomes
To operate well across these areas, she says these leaders will need to manage through uncertainty as they navigate shifting funding opportunities and organizational change.
In this time of tumult, Henry has observed an increased presence of collaborations, as informal as experience-sharing and as formal as merger negotiations. As a result, there’s also a growing need for leaders to recognize and acknowledge how “everything interacts,” as she describes it. “There’s so much opportunity for collaboration, but that requires leaders to see beyond their own boundaries and be willing to engage in discussions that may be historically seen as off-limits.”
Sometimes, these cross-organizational conversations can lead to productive disagreements—which Henry says are vital for boards that want to explore an issue from all angles. “You have to be able to talk to people who aren’t like you (whether it’s through written communication or face-to-face), have debates, and respectfully disagree. It’s becoming a lost art, but it’s so important for doing this work well.”
Preparing Creative Leaders for Nonprofit Dynamics
These trends are top of mind as Henry designs and updates the curriculum for Design, Culture, and Politics, a course she teaches for the MS in Leadership for Creative Enterprises (MSLCE) program.
“There is culture in any structure you create, including a board,” says Henry. “That culture can help or hinder the organization’s success. This class helps break apart the dynamics experienced inside of an organization.”
To dig into those dynamics, she covers topics like:
- Identifying inherent conflicts when grouping activities and people together
- Surfacing spoken and unspoken elements that make up an organization’s values and beliefs, and working through the tensions they create
- Establishing a culture that supports the kind of organization students want to lead
- Building coalitions and allyships to move work forward and influence outcomes
- Understanding different forms of power—positional, personal, and relational—and how they shape relationships and decision-making
Henry’s goal is to help students move from seeing themselves as “individual contributors” to feeling confident about stepping into leadership roles as “managers” with a view, mindset and skillset to match.
“I love teaching as part of the MSLICE program and connecting with creatives,” Henry says. “I appreciate the opportunity to help them build the skills they need to make their dreams a reality.”
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