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What makes nonprofits special?

Nonprofit organizations are under assault today as perhaps never before, with consequences that could be profound for the future of these organizations and for those they serve. The most prominent example of this has been proposals to reduce or cap the federal tax deduction for charitable contributions, which have become an increasingly common feature of budget-balancing measures from both ends of the political spectrum.
 
But the challenges facing the sector do not stop with the charitable deduction. There have been several assaults on the special status of nonprofits in recent years, including the imposition of taxes and other fees by state and local governments and a growing number of demands for nonprofits to make payments in lieu of taxes (PILOTs). On top of these pressures, shifts in government payment methods that advantage for-profit businesses have resulted in a reduction of nonprofit presence in many traditional nonprofit fields—over the past decade the nonprofit share of private employment has decreased by nearly 8 percent in social assistance, by 4 percent in education, and by 2 percent in health care; as for-profit employment in those fields has expanded.
 

WHY NOW? An important part of the reason that nonprofits find themselves in this situation is that the pressures they are under to survive in an increasingly competitive environment have pulled them away from their historical modes of operation and from widespread public assumptions about how nonprofits are supposed to operate. This has blurred the borders between nonprofits and for-profits and caused confusion about what sets nonprofits apart.
 
Center Director Lester Salamon has been studying these factors and the ways they have affected both nonprofits themselves and the public’s perception of them. In The State of Nonprofit America, he characterizes this situation as a “force field,” with nonprofits being caught among powerful impulses pulling them simultaneously in different directions. Four of these impulses seem to be particularly powerful, pulling nonprofit organizations, respectively, toward their voluntaristic past, toward greater professionalism, into expanded civic activism, and into deeper engagement with commercialism and the market.
 
Which of these impulses wins out will have enormous implications for what nonprofits become, how they go about their work, and what role they play in American life. As Salamon states in The State of Nonprofit America:

“Of special note in recent years has been the growing impact of the commercial/managerial impulse, eclipsing the professional emphasis on effectiveness and the voluntaristic emphasis on expressiveness, and potentially undermining as well much of the sector’s historic attention to civic activism.”

 
WHAT CAN NONPROFITS DO? While this movement toward a more commercial model has given nonprofits access to new funding streams and greater emphasis on efficiency, the resulting movement away from the most deeply held public conceptions of the sector has occasioned a series of challenges, including a key erosion of public trust, which opens the door to further challenges to nonprofit advantages.
 
In the State of Nonprofit America, Salamon makes the argument that the nonprofit sector must embark on what he terms a “renewal strategy.”
 
The first step toward undertaking such a renewal will require nonprofit organizations — from human service organizations and universities, to orchestras and nursing homes — to come to some sort of general consensus about what qualities and attributes make them such a special, and important, part of American society today. But, given the enormous diversity of the nonprofit sector, forging such a consensus poses an enormous challenge.
 

CLARIFYING THE CORE NONPROFIT VALUES. The Center’s Listening Post Project took on this challenge, fielding a survey to over 1,500 nonprofit organizations from around the country working in human service, arts & culture, and community development. The survey asked how important the leaders of these organizations felt a series of nonprofit attributes identified in the literature were to their organizations, and how well they felt their organizations embodied them.
 
The survey found that an overwhelming majority of respondents were able to agree on seven core values that are crucial to the nonprofit sector and that, in aggregate, truly set the sector apart. Those values are: being PRODUCTIVE, EMPOWERING, EFFECTIVE, ENRICHING, RELIABLE, RESPONSIVE, and CARING. They also provided numerous examples of how their organizations were embodying these values.

 
STARTING THE CONVERSATION. But the survey also found respondents concerned that many of the sector’s stakeholders in government, the media, and the general public do not seem to understand the values that the sector brings to the table today. In light of current challenges to the sector’s public trust and status, they acknowledged that the consequences of this failure to communicate these values could prove very harmful to the sector. They therefore endorsed an effort to clarify the “value add” of the nonprofit sector both within the sector and among its key stakeholders.
 
As a first step in this direction, on December 6, 2012, the Johns Hopkins Center for Civil Society Studies launched its Nonprofit Values Communiqué reporting the results of this survey. With this launch, the Center and our Listening Post partners hope to begin a broad conversation about these values, and how nonprofits can better communicate them to their supporters, funders, and stakeholders. We also hope to assemble concrete examples of how nonprofits embody these values in their work.
 
We want to make this conversation as broad-ranging as possible. Please join us on Twitter (use #nonprofitvalues) and Facebook to add your voice!
 
updated 12.11.2012
 
 

Permanent link to this article: http://ccss.jhu.edu/what-makes-nonprofits-special