Financial Strategy

Example: Financial Strategy of ELSA 2019-2022

Scope of a Financial Strategy

The Financial Strategy of ELSA is a financial management tool in ELSA, complementary to the Strategic Plan in ELSA, that serves the purpose of guiding and establishing the limits of budgets and all the instruments of short-term financial planning.

The main goal of a Financial Strategy is to establish a long-term plan that will support boards in defining the use of resources and how to make them grow in the interest of the association. Also, the Financial Strategy of an ELSA Group represents a collection of ideas and actions that determines the long-term outcome of each group.

The Financial Strategy of ELSA International is composed of 3 stages:

Implementation

Describing the way that the Financial Strategy must be adapted and maintained

In practice: Where are we now?

Focus

The fundraising and expenditure focus of the respective Financial Strategy

In practice: Where would we like to be?

Execution

Specifying the focus part on a technical level by determining the ratios, or individual amounts of the income or expenses stated, exposing which measures should be taken.

In practice: How do we get there?

Example: Financial Strategy of ELSA 2019-2022

Important Targets:

Partnerships: a prominent source of income for ELSA.

Membership Fee: not be considered as a common source of income.

Advertising shall become a reliable source of income of ELSA.

Grants shall represent at least 50% of its income, be eligible to the One-off structural grant of the European Youth Foundation and aim to have staff funded by grants.

Professionalisation: the sustainability of the association shall be ensured through consulting professionals.

Marketing: investments shall be made to make the marketing tools and production of the association more professional.

A reserve shall be reconstituted equal to 50% of the annual income to solve liquidity issues.

Allowances: shall be provided with a legal and decent income to the members of the International Board of ELSA.

Auditing: A consistent auditing system shall be set up, with the chance of having transition and external auditing.

Projects

The John H. Jackson Moot Court Competition (JHJMCC) shall be made self-sustaining and its reserve shall be reconstructed.
The European Human Rights Moot Court Competition (EHRMCC) shall increase the standard of the competition while maintaining its financial stability.
Synergy shall be made self-sustaining.
The quality of ELSA Law Schools (ELS) and the communication surrounding the project shall be increased.

Creating a Financial Strategy

After structuring your Financial Strategy into the three main stages explained above (implementation, focus, execution) to ensure clarity between vision and technical application, you also need to ensure that transition includes dedicated sections addressing the Financial Strategy, so that the incoming Board fully understands its objectives, targets, ongoing commitments and monitoring mechanisms.

When drafting or revising a Financial Strategy, it is strongly recommended that the strategy be discussed with the entire Board to ensure that financial planning is treated as a collective responsibility and aligned with the overall strategic direction to be pursued.

It is also advisable to consult former Treasurers of the Group, as their experience and knowledge of previous financial years can provide valuable insights and help avoid repeated mistakes.

In addition, guidance should be sought from the Treasurer or the person in charge of Finance within the International Board of ELSA in order to review the strategy jointly, receive feedback, and ensure alignment with established standards and best practices.

For guidance, you will find detailed information as well as a template helping you creating a strategy in the Financial Strategy Handbook.

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