One of the most important responsibilities of a nonprofit board is supporting and evaluating the Executive Director (ED). Yet many boards struggle to create clear, measurable goals for their ED — and without them, accountability and alignment often fall short.

That’s where Key Performance Indicators (KPIs) come in. KPIs give both the board and the ED a roadmap for success. They define what matters most, provide clarity for evaluations, and ensure the organization stays focused on mission impact.

Why KPIs Matter

  • Clarity – Everyone understands what success looks like.
  • Alignment – Goals connect the ED’s leadership to the organization’s strategy.
  • Accountability – The board can measure performance objectively, not just based on “gut feeling.”
  • Motivation – Clear goals help the ED focus, prioritize, and celebrate wins.

How to Set Effective KPIs

  1. Start with the Strategic Plan
    KPIs should flow directly from your organization’s mission and long-term strategy. If your strategic plan highlights fundraising growth, community outreach, or program expansion, your ED’s goals should tie directly to those priorities.
  2. Keep it Focused
    Resist the temptation to create a laundry list. Four to six KPIs per year is ideal. Too many goals dilute focus; a small number creates accountability and clarity.
  3. Make Them Measurable
    “Improve fundraising” is vague. “Increase unrestricted donations by 10%” is clear and measurable. Wherever possible, include a specific target, percentage, or timeline.
  4. Balance Financial and Mission-Driven Metrics
    A strong set of KPIs should look at both dollars and impact. Examples:

    • Fundraising revenue growth
    • Program participation or outcomes
    • Employee engagement/retention
    • Community partnerships developed
  1. Check In Regularly
    Don’t save everything for the annual evaluation. Schedule quarterly or mid-year reviews of progress toward KPIs. This creates space for coaching, adjustments, and early wins.
  2. Document the Process
    Always put ED goals in writing and record discussions in board minutes. This not only protects the board but also ensures transparency and consistency.

The Payoff

When boards set meaningful KPIs for their ED, they move beyond vague oversight to true partnership. The ED knows what success looks like, the board knows how to measure it, and the organization gains a clear path to long-term impact.

📢 Ready to Strengthen Your Board?

Join us for our upcoming webinar: Future-Proofing Your Board: Strategies for Long-Term Success 📅 January 20th | 🕘 9:00 – 10:15 AM PST

Our expert panel — Kendra Dockham, Carlos Carazo, and Hannah Baldwin — will share practical strategies on:

  • Setting clear goals and expectations for your ED
  • Conducting compensation studies
  • Recruiting and onboarding board members
  • Succession planning for both your ED and your board

👉 Reserve your spot here: https://www.eventcreate.com/e/futureproof

Strong boards don’t form by chance. They’re built with clear goals, intentional planning, and accountability.