In 2004, The Annie E. Casey Foundation, a private charitable organization, conducted an extensive research survey providing insightful information and statistics about the future of nonprofits. According to their report titled “Change Ahead, Nonprofit Executive Leadership and Transitions”, nonprofits have experienced or will soon experience a drastic change in the foundation of their leadership and executive positions that will greatly affect the success and longevity of the organization.

Because nonprofits devote a higher percentage of their resources to providing services and performing charitable, philanthropic acts, The Casey Foundation argues that less of their attention and revenue is focused on company infrastructure, managerial support and organization. This bittersweet facet of philanthropic organizations can perceptibly leave these sorts of companies more vulnerable during times of change and restructuring.

However, the sole reason why nonprofits may see a significant change in the future of their organizations has less to do with structure and more to do with the age of the directors and founders. What does this even mean? Well, the baby boomer generation (those born between 1945 and 1965) is quickly approaching and or has already reached retirement age. According to the Annie E. Casey Foundation report, seventy-seven million baby boomers make up over 50 percent of the workforce, while only 38 million generation x’ers (those born between 1966-1975) are waiting to take their place.

The Foundation’s report states that nonprofits will be uniquely affected by boomer retirement because a great majority of these types of philanthropic companies are founded, run, and directed by the baby boomer generation. Because baby boomers occupy such top, pivotal roles within nonprofits, these organizations are sure to see dramatic changes once this group decides to retire. Because there are fewer generation x’ers to take the baby boomers’ places, there is going to be a clear gap in leadership that will need to be filled.

If nonprofits do not prepare to accommodate for these gaps, they could see negative outcomes. Poorly managed executive transitions incur high costs and they often lead to periods of under performance. The Annie E. Casey Foundation report anticipates that there will be more nonprofit executive leadership transitions between 2005 and 2010 than occurred in the ten years before the survey was conducted (1994-2005).

The report revealed that 23% of executives planned to leave between 2004 and 2006 and 65% percent planned to leave by 2009. They also reported that 57% of nonprofits experienced an executive transition between 1994 and 2004. The Foundation’s estimated transition rate of 10% a year is likely to increase until 2010. By 2020, all baby boomers will have reached age 62, which is when, The Foundation asserts, most if not all nonprofit executives will decide to retire. Yes, this anticipated mass wave of retirement will leave countless job openings at the helm of nonprofits for those who are ready to lead, but these organizations need to be ready to accommodate employees wanting to take on those roles.

So, how do nonprofits prepare for these waves of change and executive transition? The Annie E. Casey Foundation proposes that they reach out to the younger generation and young professionals. The nonprofit leaders and founders of today need to create leadership positions for the younger people of generation x and generation y and prepare those seeking out philanthropic leadership roles to operate the controls of nonprofits. After all, directors, executives, and founders especially cannot expect the transition to be seamless if the entire leadership sector and the employees they are surrounded by are expected to retire. Nonprofit leaders can also expect difficulties if they have not reached out to the younger generations to stress how the organization should be run and what its core values and missions are.

In addition, the recruitment, training, and retention of young workers has to become a priority of nonprofits if they hope to have longevity and continue to do good work in the future. The baby boomer nonprofit leaders cannot afford to wait for the younger generations to catch up on their own, nor can they expect young professionals to effortlessly follow in the footsteps of the leaders before them if this young work sector has never been given leadership roles within the nonprofit before. Having the experience of leading under their belt is the key to success.

As the baby boomers start to consider retirement, directors must motivate tomorrow’s leaders to stay engaged. These top executives must be willing to offer leadership positions to a younger generation and they also must be ready to pass on what they have learned through their own managerial experiences. If a nonprofit founder or leader hopes to maintain her organization’s legacy and integrity for years to come, she must be ready to pass on the torch and the keep the fire of charity and philanthropy burning bright with the younger generations.