Risk management is not easy but a few things can help a lot: creating a risk tolerance statement, scenario planning, benchmarking and self-rating, setting explicit financial stability targets, creating continuity plans (i.e. living wills) etc. Nonprofits must ensure that well thought through risk management processes are in place. Trustees must recognize that risk management is inherent in their duties of care, obedience, and loyalty. Nonprofits serious about risk management may find the following resources helpful.
Understanding Overhead: A Governance Challenge for Nonprofit Trustees (An addendum to the SeaChange’s risk report)