Creating an Incredible Annual Report for Your Organization

Have you ever embarked on the tremendous pile of work involved in creating your annual donor report and wondered whether it makes a difference?

As the sector starts to move to more personalized versus mass engagement and, as one of the staples of annual reports goes out of style (namely, donor lists), it would be strange if you didn't feel hesitant to invest resources in a donor impact report. At the same time, there is often a visceral emotional reaction to the idea of not doing an annual report as it can often be one of the few times your organization celebrates what it has accomplished.

So don't give up your annual report. Let's make it an incredible resource for sharing your organization's story and engaging supporters.

Start by Evaluating Past Annual Reports

I joined Scarborough Health Network Foundation last January. I came into an organization that had very quickly grown its donor base and major fundraising results, as well as its brand profile and marketing. At the same time, the foundation had begun taking its first steps into the new world of personalization and integrating our entire donor funnel from brand story to donor thank-you.

Before I met with the team about some of the data-backed content we might need for the next report, I spent some time on our earlier annual reports. I found a few things I really like, especially this: We're telling the right story.

We speak very clearly about how much is being granted to the actual hospital network. The truth is our donors aren't giving to us as a foundation, they are giving to the hospitals. Our stories should (and do) speak to that impact. For example, we showcased exceptional stories about changes that donor funds helped accomplish, like breaking ground on the new Diagnostic Imaging department. And there was a story from one of our physicians who gave you a window into her relationship with the community and how meaningful donations are for her. Beautiful!

On the other hand, there were some choices we might want to reconsider next time, such as including a lot of self-congratulatory numbers. Do these vanity metrics look familiar to you?

• How much we raised
• Number of donors
• Number of media stories
• How much merch we sold, and such

Think about what these numbers say to your donors. Sometimes, leadership feels the need to share internal wins with the broad audience. Sometimes, your design team wants those pretty graphs. But at the end of the day, is it meaningful to your donor to know that they are one of 5,000 individual donors and that there are 500 corporate donors? Do they want to be thought of as monthly donors or as part of a legacy program?

If you're going to include numbers and stats other than your financials (which you should always provide with excellent clarity), they should all be focused on impact, and they should directly connect to the larger story about impact you are telling. For example, last year the foundation had a story about our priority to transform one of our hospital's emergency departments. We included a stat about the number of emergency visits.

On the data side, this means you need to really track carefully how funding flows to projects. For Scarborough Health Network Foundation, this is a bit easier as we must grant over funds on a project basis. If you are an organization that collects and then spends from the same pot of money, you will need to put care into how you track that in your database so you can get meaningful information back out.

First Challenge: Clearly Define the Audience

We tend to make ourselves the audience, as well as our closest stakeholders, like board members. If you want to create an annual report with real impact, the audience should be your donors. Let go of the idea of an annual report to serve all stakeholders and embrace (and be brutal about) including only information that is meaningful to your donors. It will transform your report.

For every story, every picture, every number, stop and ask yourself, "What is this telling our donors?" (Not just your major donors. Every donor.)

Repurpose Stories that Already Resonate with Your Donors

If you are struggling to find the stories that will matter to your donors, start with what you know. Look at your organization's existing content:

• Social posts
• Newsletters
• Events materials

What has performed most effectively with donors? Allow these to set your themes. The advantage of leaning into your top-performing current content is to preserve the momentum of your most compelling campaigns and reinforce the brand-building you have already accomplished in the previous year.

Use Your Story as a Retention Tool

To improve donor engagement with your annual report, make sure you speak to all levels and types of donors. People need to see themselves as part of your community. This builds buy-in and invests them in your organization's success and future. This is vital to donor retention and stewardship.

Don't just offer data and facts, though. Build an emotional investment. Donors give because it makes them feel good and your annual report should focus on your donors feeling that they are doing good.

Personalize the Impact Story of Each Major Gift

For major gifts, you should be providing personalized stewardship reports for each gift. In the annual report, focus on how the major gift triggered momentum for a project, or how the project will transform your deliverables.

As a healthcare organization, Scarborough Health Network needs to speak as much as possible about patient impact (or breakthroughs in research, or student impact for education activities). When I worked at a university, we needed to focus primarily on student impact, then on research breakthroughs, then on faculty/staff impact. If a story does not show impact and does not help your donors feel good about giving, this isn't where you should be telling it.

Second Challenge: Share Only What Is Meaningful to Donors

Too often, our donor impact report represents our organization's work, instead of showing the impact of donations. There will always be a ton of important work we do to make our organization function well, and that attracts new donations, but it is not donor impact. If we make a gorgeous ad, our team will love it; but talking about how beautiful our ad is doesn't communicate anything meaningful to our donors. The same goes for awards we win, new systems we implement, etc.

The only time you should celebrate such milestones in an annual report is if they impact donor trust in your organization (for example, in Canada if you were to be certified through Imagine Canada's Standards Program for the first time, you will want to say that somewhere).

Highlight Financial Reporting to Develop Trust with Donors

In terms of the practical realities of a great annual report, it is vital to present excellent financials. It is key to fostering donor trust in your organization. Because not all readers will know how to interpret the details of a financial report, build translation into your pages, with just enough information to be digestible and useful, but not so much that it overwhelms the typical donor. As with all the storytelling in your annual report, the goal with financials is to highlight the impact of donor generosity.

Go Digital to Expand Your Readership

You should design your annual report as digital first. If you can only do either a digital or a paper annual report, choose the former. A digital report will have increased reach, visibility, and impact. If you implement search engine optimization more people will see the impact stories in a digital delivery. Since your annual report will talk beautifully about the impact donors have through your organization, this is content you want all donors (and potential donors) to read.

While I'm especially proud of SHN Foundation's most recent digital annual report, I'd also like to share two more splendid examples of digital-first annual report designs:

• DigDeep Annual Report
• Google's Diversity Annual Report

Finally, don't forget many of your donors are new donors. Your report needs to communicate your mission, vision, and key priorities (both those carried out in the past year and those upcoming in the next year.)

Think of your annual report as a love story to your donors. They should feel valued by your organization. They should feel confidence and trust in your organization. They should feel inspired by your organization.

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