Summary 

Grant Thornton New Zealand Not for Profit Sector Report 2026  ‘Turning resilience into reality’ (published 2 September 2026)

Grant Thornton provides audit, tax and advisory services. https://www.grantthornton.co.nz/about/ 

205 organisations throughout the country responded to their online survey in April/May 2026, a third from the social services sector.  (It does regular surveys, the last in 2022).

Below are some main highlights they have identified.

Five key themes:

• Demand is increasing but funding isn’t keeping pace.
• Service performance reporting is yet to deliver to its full potential/value.
• Fraud and cybersecurity remain underestimated.
• Governance capability is becoming harder to sustain.
• Technology is an important resilience tool. 

More people in need, fewer resources to go around, with funding remaining the top concern, partly driven by cost-of-living issues.  

Grant Thornton said many NFP leaders it had talked to say the current government appears increasingly interested in private philanthropy and other non-government funding sources. Generally framed as partnership, co-investment and community-led solutions rather than an explicit policy of replacing government funding with philanthropy. 

There may be real potential here, but Grant Thornton say it is important to recognise the huge contribution NFPs already make to the economy and country. 

“Without them, our people, animals and environment would be much worse off, and the Government would be forced to pick up the pieces, at a considerable cost. For example, formal volunteers contribute 159 million hours of unpaid labour, worth $4 billion, every year.” Pg 5

Finding and retaining staff pressures have eased – reflecting the weaker job market compared to 2022 when the last survey was done (which had 174 responses). 

Service performance reporting (SPR) is difficult for medium and large NFPs.  Four years after it was rolled out for Tier 1 and Tier 2 NFPs, SPR does not appear to be helping many organisations measure or communicate their success. 

‘Had SPR improved their ability to evaluate their performance?” Over half of 121 answering the question thought there was no noticeable improvement or they were not sure. 

Grant Thornton suggest NFPs move beyond compliance and use performance reporting as a genuine management tool to support better decision-making, strengthen funding conversations and help them tell a credible story about the difference they make. 

Strategic planning – Successful NFPs are not necessarily those with the most resources, but those that are most intentional about how they use them.

Engagement during strategic planning is too narrow – when developing strategies most in the survey talked with governance (88%) and management (82.5%), with a slight increase in employee engagement (44%) compared to 2022. Engagement with volunteers, recipients of services, relevant community groups, iwi and other groups and iwi was much more limited. 

Governance Structure

• Independent members In 2022, 31% of Boards had no independent members, however in 2026 this was 40%. Grant Thornton believes independent Board members bring external perspective, constructive challenge and additional expertise, can strengthen credibility, reduce the risk of conflicts of interest and support greater independence in Board oversight. 

• Remuneration – 28% (57) of 204 Not For Profits in the survey remunerate their board members (same as 2022).  Of the 57 answering the annual fee question, 7% said less than $1000 per annum, and 42% said between $5,001 and $15,000.   

• Attracting Board members – The bigger challenge may be the limited pool of capable Board members, many of whom are already stretched across multiple organisations.  NFPs struggle to attract Board members which is no wonder when governance requirements and responsibilities keep increasing. 

• Grant Thornton thinks Boards that identify future leadership needs early, cultivate potential candidates and create pathways for new members are generally better prepared to maintain continuity and adapt to changing circumstances. 

Risk planning – fraud is an underrated area of risk. Health and safety remains the most well-planned area of risk (70% of 193 organisations) which is unsurprising given serious consequences. 

However, specific planning for fraud has fallen from 44% of organisations in 2022 to 35% in 2026. NFPs are vulnerable because they often operate with limited resources, high levels of trust and lean administrative teams.

Technology Investment – 71% of 190 organisations had invested in websites, social media and other digital platforms and 21% were planning these as their top technology project in the next two to three years.  36% had spent on AI in the last two years and 16% were planning this as their top technology project.  

Cybersecurity overconfidence is a concern and many NFPs are underprepared for a risk that continues to grow in frequency and impact– investment in this has dropped slightly from 43% to 40% between 2022 and 2026. May reflect choices faced with limited resources but it is a governance, operational and organisational resilience issue according to Grant Thornton.

19% of respondents had no cybersecurity policies or practices. And 33% had no incident response plan for a cyber event or incident.

17% (35 organisations) had experienced a cybersecurity event (e.g. phishing, ransomware or data breaches) in the past 12 months. 

Nevertheless, 69% were very/somewhat confident they could prevent a cybersecurity incident, suggesting a degree of over-confidence. 

Organisations need to consider whether they have the expertise to effectively oversee and challenge cyber-related risks and decisions. 

Team, people and volunteers

• Why paid people leave – the main reason NFPs gave is personal choice or change in lifestyle at 33% of 191 organisations, up from 25% saying this in the 2022 survey and just 4% in 2015. A substantial change reflecting shifting priorities over the past decade Grant Thornton suggest. 

• Funding fair remuneration remained challenging, compounded by the cost of recruiting and training new staff and rewarding current staff. Financial constraints were the number one issue facing the sector. 

• Why volunteers leave – Personal choice or change in lifestyle at 34% (same as in 2022) and related to both attitudes and demographics.  

• Grant Thornton noted The State of the Decade of Volunteering 2025 report by Volunteering NZ  found around half of organisations see ageing of the volunteer workforce as a major challenge. 

• For younger volunteers the report found they were increasingly motivated by personal values, skills development and alignment with causes they care about, with some reporting burnout and disengagement.

• Grant Thorton think to some extent NFPs need to adjust to a new normal – a fairly high turnover of volunteers. It is essential to reduce key personnel risk by documenting knowledge, sharing responsibilities and building capabilities across teams. 

Financial Resilience

40% of 205 respondents indicated they have less than one year’s worth of reserves and secured funding available – which Grant-Thornton thought may be appropriate if funding sources are predictable and regularly renewed, but for others may mean less flexibility to respond to challenges and opportunities 

29% had more than two years of reserves and secured funding – they may be building towards major projects, property purchases or other priorities – the important question is if there is a clear rationale for the level of funding and reserves being held and if it aligns with the long-term strategy and risk profile.

Diversifying income streams was being considered by over 75% (out of 158). Grant Thornton notes diversification can create opportunities and financial resilience but also bring challenges. 

New income streams may require different skills, governance oversight, systems and investment.  The most successful often build on existing strengths, relationships and expertise rather than going into new territory. 

It notes the proportion of respondents running a social enterprise fell from 35% in 2022 to 15% in 2026.  This may reflect a more cautious approach to risk, exiting unviable ventures or natural turnover in the sector.