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Article
Publication date: 15 November 2022

Edward N. Gamble, Pablo Muñoz and Kenneth A. Fox

US tax-exempt nonprofits are chronically underdeveloped when it comes to reporting, communicating and comparing the value they create. This paper aims to explore an…

Abstract

Purpose

US tax-exempt nonprofits are chronically underdeveloped when it comes to reporting, communicating and comparing the value they create. This paper aims to explore an approach to address these reporting and disclosure issues, for the purpose of sustainability and impact.

Design/methodology/approach

First, the authors ask and then answer: is it time to clean up US tax-exempt nonprofit reporting? Second, the authors develop a theoretical argument, based on commensuration of impact, for a specific tax-exempt integrated report (IR), to compare the value of tax-exempt nonprofits. Third, this study offers an example of this tax-exempt IR in practice.

Findings

First, this study evidences the need for a drastic shift in the expectations and reporting practices of US tax-exempt nonprofits. Second, this study offers an IR framework that responds to recent scholarly calls to address organizational accountability boundaries and impact assessment in the nonprofit sector. Third, this contributes to sustainability policy conversation by mapping out an approach that US tax-exempt nonprofits could deploy to speed up the implementation of sustainable solutions (Sustainable Development Goal [SDG] 17).

Practical implications

This study contributes to sustainability conversation by closing with a discussion of why policymakers, managers and scholars should continue to push for maximum impact from US tax-exempt nonprofits. If addressing the UN SDGs is a desired outcome, then there is an immediate need for change in the way US nonprofits report what they do. This study suggests that learning from the European Union reporting practices and regulations will facilitate a move toward improved reliability, comparability and impact from US nonprofits.

Social implications

The aim of this paper was to present a disclosure framework that provides reliable and comparable information of the value created by tax-exempt nonprofits. This principle-based framework is rooted in the IR literature and extends into the prosocial world of tax-exempt nonprofits, recognizing that is it goes farther than simply being a framework; it is a social process.

Originality/value

This paper responds to recent calls for more oversight and comparison disclosure mechanisms of US tax-exempt nonprofits, for the purpose of reducing social or environmental inequality. The framework makes an important contribution to the field of sustainability accounting, in that it promotes a principle-based approach for measuring and regulating tax-exempt nonprofits, in a way that motivates oversight and comparison of sustainability-related practices.

Details

Sustainability Accounting, Management and Policy Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 28 October 2002

Rosemarie Emanuele and Walter O. Simmons

Previous research has found that nonprofit organizations pay lower wages than do other organizations. This has been attributed to altruism on the part of workers who are…

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Abstract

Previous research has found that nonprofit organizations pay lower wages than do other organizations. This has been attributed to altruism on the part of workers who are willing to donate some of the value of their time to organizations that support causes in which they believe. This paper extends that analysis to the cost of fringe benefits. Do nonprofit organizations spend less on fringe benefits than do other organizations? Utilizing a data set containing information on wages and fringe benefits in the nonprofit sector we estimate a standard wage equation to test for such a relationship. We find that not only are nonprofit organizations spending less on fringe benefits than are other organizations, but that they are spending significantly less than would be predicted by the previous research on nonprofit wage differentials.

Details

American Journal of Business, vol. 17 no. 2
Type: Research Article
ISSN: 1935-5181

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Article
Publication date: 1 April 2005

Lynn Taliento and Les Silverman

By introducing business people to the frustrations of leadership roles in nonprofits and showing how executives with corporate experience have dealt with these challenges

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Abstract

Purpose

By introducing business people to the frustrations of leadership roles in nonprofits and showing how executives with corporate experience have dealt with these challenges, the authors provide a guide for volunteers who serve as board members, executives, donors, consultants or partners in the nonprofit sector.

Design/methodology/approach

McKinsey & Company consultants interviewed executives who have served as both corporate and nonprofit leaders.

Findings

Corporate executives working with nonprofits need to take the time to get to know the organization and all its stakeholders before proposing any new practices or initiatives. They should avoid unilateral decisions – instead involving board, staff and key stakeholders as appropriate.

Research limitations/implications

The sample interviewed was small, about a dozen top executives. However, as more corporate executive take leadership positions in nonprofits, there will be an opportunity to survey a much larger sample.

Practical implications

Business leaders serving as nonprofit board members will better understand their nonprofit roles. Donors will learn to use their financial clout to improve nonprofit performance. Cross‐sector partnerships – which are central to addressing society's most intractable problems – can anticipate and solve roadblocks caused by the nonprofit sector's different culture and demands. Top business executives will gain a better understanding of what makes the nonprofit world tick.

Originality/value

This article assesses the factors for nonprofit sector leadership success based on the first‐hand experience of top executives who have run major corporations.

Details

Strategy & Leadership, vol. 33 no. 2
Type: Research Article
ISSN: 1087-8572

Keywords

Book part
Publication date: 18 April 2016

Laura Berardi, Michele A. Rea and Giulia Bellante

The literature considers three main models of nonprofit sector structure and development: liberal, welfare partnership, and social democratic. This study analyzes the…

Abstract

Purpose

The literature considers three main models of nonprofit sector structure and development: liberal, welfare partnership, and social democratic. This study analyzes the cases of Italian and Canadian nonprofit organizations (NPOs) that operate in two third-sector contexts, widely known as “hybrids.” In particular, we aim to verify whether some features of governance, leadership, and volunteer participation have impacts on the financial performances of selected Italian and Canadian NPOs.

Methodology/approach

Differences between the two studied nonprofit contexts influenced the sampling, the data collection, and the methods of analysis. Data on Italian and Canadian NPOs are analyzed both together and separately, using multiple regression models. Revenues, fund-raising and other grants from the general public, and program expenses are used as measurements of financial performance.

Findings

Our analysis demonstrates that some board characteristics, as well as volunteer participation and representation on the board, have impacts on the nonprofit financial performance. The characteristics of the CEO studied in this work are not significantly associated with the level of financial performance.

Research implications/limitations

This study has several important implications for research on board characteristics, CEO characteristics and volunteer management and governance, as well as implications for practitioners. The limitations of this study are related mostly to the different methods used for sampling NPOs and collecting data in the two different country contexts due to the different level of availability of data.

Originality/value

The past literature has not adequately examined the relationships among the board and CEO characteristics, the role of volunteers in governance and financial performance.

Details

Governance and Performance in Public and Non-Profit Organizations
Type: Book
ISBN: 978-1-78635-107-4

Keywords

Book part
Publication date: 17 September 2012

Carol J. De Vita and Erwin de Leon

Purpose – To examine the role of Latino community-based nonprofits in integrating first- and second-generation Latino immigrants into mainstream society.

Abstract

Purpose – To examine the role of Latino community-based nonprofits in integrating first- and second-generation Latino immigrants into mainstream society.

Methodology/approach – This place-based study uses a mixed methods approach to analyze financial and administrative data from the National Center for Charitable Statistics and semi-structured interviews with organizational leaders.

Findings – Latino community-based nonprofits provide a wide range of programs and services to their constituents that promote the social and political mobility of Latino immigrants and their families. Findings also suggest a potential spatial mismatch between Latino-serving nonprofits and the people they serve. The organizations are concentrated in the Washington, DC metropolitan area while the Latino community is branching out into the outer suburbs of Maryland and Virginia. Moreover, different political and administrative structures and policies affect the ability of these nonprofits to serve their constituents.

Research limitations/implications – The study's geographic boundaries may limit the generalizability of spatial mismatch between Latino-serving nonprofits and their constituents. However, the findings about programs and services and the impact of political and administrative structures and policies can be applied to other immigrant-serving organizations.

Practical implications – Policy makers, elected officials, and other stakeholders can learn the importance of Latino and immigrant community-based nonprofits. These organizations act as bridges to the Latino and other immigrant communities.

Social implications – Latino and other immigrant community-based nonprofits are integral to the integration of immigrant communities as active and contributing members of wider society.

Originality/value of paper – This study looks at immigrant integration through the lens of community-based nonprofits.

Details

Hispanic Migration and Urban Development: Studies from Washington DC
Type: Book
ISBN: 978-1-78052-345-3

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Book part
Publication date: 8 July 2021

Marco Tavanti and Anna Tait

This chapter reviews ethical challenges confronting nonprofit administration in relation to organizational managerial practices and leadership behaviors. Through a…

Abstract

This chapter reviews ethical challenges confronting nonprofit administration in relation to organizational managerial practices and leadership behaviors. Through a theoretical model of nonprofit-specific toxic leadership, it reviews the dynamics of destructive leaders, susceptible followers, and conducive environments in cases of unethical and corrupt nonprofit organizational behaviors. It provides a case for prioritizing oversight responsibilities of the board of directors, board supervision, promoting ethical culture in organizational leadership, and implementing policies for addressing destructive and corrupt nonprofit leaders. It reflects on how nonprofit toxic leadership primarily erodes public trust in the nonprofit sector and concludes with practical recommendations for recentering positive behaviors congruent with the nonprofit's social and public good mission.

Details

Destructive Leadership and Management Hypocrisy
Type: Book
ISBN: 978-1-80043-180-5

Keywords

Book part
Publication date: 24 October 2022

Jonathan J. B. Mijs

The nonprofit sector has come to deliver the majority of state-funded social services in the United States. Citizens depend on nonprofit organizations for these services…

Abstract

The nonprofit sector has come to deliver the majority of state-funded social services in the United States. Citizens depend on nonprofit organizations for these services, and nonprofits depend on government for financial support. Scholars have begun to ask important questions about the political and civic implications of this new organizational configuration. These questions have direct ramifications for the anti-prison movement given the explosive growth of nonprofit prison reentry organizations in recent years. To see how such organizations may impact political engagement and social movements, this chapter turns its focus on the intricate dynamics of client-staff interactions. Leveraging a yearlong ethnography of a government-funded prison reentry organization, I describe how such organizations can be politically active and at the same time contribute to their clients' political pacification. Staff members engaged in political activities in surrogate representation of their clients. While staffers advocated on their behalf, clients learned to avoid politics and community life, accept injustices for what they are, and focus instead on individual rehabilitation. By closely studying what goes on within a nonprofit service provider, I illustrate the nonprofit organization's dual political role and its implications for social movements and political change.

Book part
Publication date: 27 October 2020

Elizabeth A. M. Searing, Daniel Tinkelman and

In 2009 and 2010, the Financial Accounting Standards Board (FASB) adopted new accounting standards for nonprofit mergers and acquisitions. The new accounting standards are…

Abstract

In 2009 and 2010, the Financial Accounting Standards Board (FASB) adopted new accounting standards for nonprofit mergers and acquisitions. The new accounting standards are an example of the constitutive role accounting can play in how people think about economic events, since the FASB defined a new concept (the “inherent contribution”) and required valuation of intangible assets that were often previously unrecognized.

The FASB’s stated goals included minimizing “pooling” accounting and maximizing transparency regarding fair value information, acquired identifiable intangible assets, and the relation between consideration paid and the fair values of identifiable assets acquired. The FASB expected many combinations would involve little or no consideration. It also expressed concern that some organizations would undervalue assets acquired, especially intangible assets.

For a sample of 2012–2017 nonprofit hospital combinations, we find general agreement with the FASB’s expectations. Almost all combinations were accounted for as acquisitions, not mergers, even though there was frequently no consideration paid. More acquirers recorded “inherent contributions” than goodwill, because the net fair value of the acquired hospital’s identifiable assets exceeded the consideration paid. Acquirers ascribed value to assets, such as intangible assets, that would have gone unreported under the prior accounting rules, although lower levels of intangible assets were recognized in nonprofit business combinations, relative to total non-goodwill assets acquired, than in public companies’ acquisitions.

Book part
Publication date: 16 November 2009

Karl Henrik Sivesind and Per Selle

Social origins theory proposes that countries cluster around different models according to how public welfare spending affects nonprofit sector scale (Anheier & Salamon…

Abstract

Social origins theory proposes that countries cluster around different models according to how public welfare spending affects nonprofit sector scale (Anheier & Salamon, 2006; Salamon & Anheier, 1998). This article confronts these assumptions about a liberal, corporatist, and social democratic model with results from a comparative analysis of highly industrialized countries with extensive welfare arrangements. We focus on nonprofit sector employment in relation to total employment in the welfare field, including education and research, health, and social services. Explanatory factors are public welfare spending, share of income from donations, and religious homogeneity. Qualitative Comparative Analysis (QCA) (Ragin, 2000) is applied to sort countries in types. The results show that the consequences of public sector welfare spending on nonprofit welfare employment vary depending on other social conditions. In liberal countries, low public sector welfare spending results in a small nonprofit share of employment. The preconditions are low religious homogeneity and large shares of nonprofit income from donations. In other Western European countries, the size of public sector welfare spending is inversely proportional with the size of the nonprofit share of employment, depending on religious homogeneity. The Nordic countries have the highest religious homogeneity, and largest public welfare costs, and accordingly, the smallest share of nonprofit welfare services. However, a similar “crowding out” pattern can be found in the presumably corporatist countries such as France, Austria, and also to some extent in Germany and Italy. In the other end of the line, we find the Netherlands, which is the clearest example of the presumed corporatist pattern in this sample. Religious homogeneity comes into play in both the liberal and the Western European causal constellation in accordance with Weisbrod's theory of government failure/market failure (Weisbrod, 1977), which indicates that this factor is more important for nonprofit welfare regimes than previously thought.

Details

Civil Society in Comparative Perspective
Type: Book
ISBN: 978-1-84950-608-3

Book part
Publication date: 3 July 2018

Paolo Andrei, Federica Balluchi and Katia Furlotti

In current economic systems, the role played by non-profit and voluntary organisations is relevant. Several studies analyse the development of these organisations and…

Abstract

In current economic systems, the role played by non-profit and voluntary organisations is relevant. Several studies analyse the development of these organisations and suggest reasons related to the dissemination of policies that first consider public intervention and then ‘the third way’ of the economy as a way to increase wealth and support economic development. In this context, it should be noted that:

  • Modern non-profit organisations (NPOs) take the form of enterprises encouraging the development of capabilities to satisfy human needs in terms of production of goods and utilities.

  • A systematic cooperation with the local context (i.e. enterprises and Public Administration) is becoming increasingly more important for the survival and development of NPOs.

  • Excellent opportunities for economic and social growth and for mutual development can develop from this type of cooperation.

  • Starting from this premise, the purpose of the research is to suggest some insight on the theme of cooperation between for-profit and non-profit world in the light of the thought of Church’s Social Doctrine, and in particular, of the Encyclical Letter of Benedict XVI, Caritas in VeritateOn Integral Human Development in Charity and Truth. In this sense, the contribution is a conceptual work; the study could improve with empirical research concerning the level of diffusion and the form of collaborations for-profit/non-profit in the Italian context.

Modern non-profit organisations (NPOs) take the form of enterprises encouraging the development of capabilities to satisfy human needs in terms of production of goods and utilities.

A systematic cooperation with the local context (i.e. enterprises and Public Administration) is becoming increasingly more important for the survival and development of NPOs.

Excellent opportunities for economic and social growth and for mutual development can develop from this type of cooperation.

Starting from this premise, the purpose of the research is to suggest some insight on the theme of cooperation between for-profit and non-profit world in the light of the thought of Church’s Social Doctrine, and in particular, of the Encyclical Letter of Benedict XVI, Caritas in VeritateOn Integral Human Development in Charity and Truth. In this sense, the contribution is a conceptual work; the study could improve with empirical research concerning the level of diffusion and the form of collaborations for-profit/non-profit in the Italian context.

From a methodological point of view, after a literature review on NPOs and corporate social responsibility, the chapter analyses reasons, strategies and tools of collaborations between non-profit and for-profit worlds (the role of Public Administration and hybrid organisation is excluded). Then, focus moves up on Church’s Social Doctrine and Encyclical Letter Caritas in Veritate with particular attention to the topic analysed in this chapter (collaboration for-profit/non-profit enterprises). The vision emerging from the Encyclical is that the dichotomy between for-profit and NPOs should be resolved by striving for the development of a ‘civil economy’ with the capacity to promote the overall development of the human being. The research highlights the importance of dissemination of initiatives promoted predominantly by NPOs, with the objective of stimulating and supporting the implementation of forms of structured collaboration; we are sure that a ‘connection point’ between for-profit and non-profit is now necessary.

Details

Hybridity in the Governance and Delivery of Public Services
Type: Book
ISBN: 978-1-78743-769-2

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