Redefining the Non-profit | unfoundation.org


When people ask what I do, I often answer that I am in the humanitarian or social good industry. Many times, I get a proverbial pat on the head and a comment along the lines of, “You mean non-profit? Oh that is so nice.”

We are rarely thought of as a power industry the way the for-profit sector is. What sets us apart? Maybe it is because we, as the third big industry (behind corporate and government), are called “non-profit.” I am not sure who made that title up to begin with, but to start any description with “non,” is not positive messaging. The Giving USA 2014 report released yesterday revealed that Americans gave more than $335 billion to charitable entities in 2013. That’s billions!

I like to think of the social sector as the place where corporations and governments leave off. Our products are saving people’s lives, educating children, and promoting human rights. Individual Americans seem to value this industry as well, with their “investments,” or individual giving, accounting for 72% of contributions, which is $240 billion. Even in the recession, individuals continued to give to charity.

We often hear debates about the crossover between non-profit and for profit standards and definitions. Should high achieving non-profit executives get paid high salaries that contribute to a larger overhead in their organizations? Can a company guarantee social good practices and still be publicly traded if its profits are a bit lower? These are all structural questions. We need to start encouraging blurred lines between the standards we hold for companies versus the ones we hold for social organizations.

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Walk into any venture capital firm in Silicon Valley and you will hear serious questions around talent, strong executive teams, good infrastructure, and preparation to scale up. These are the same questions we should be asking social good organizations, and then invest in those answers. We should be pushing companies to have ethical supply chains, philanthropic giving above 1%, and products that are environmentally sustainable.

So where is the bridge between the non and for-profit industries? Young entrepreneurs. Whether they are social or profitable or both, they are leading this trend— redefining ideas and proving we can have do good and do well. Giving USA showed that millennials make up 11% of giving, but they are also trending toward companies that are social responsible. With their employment, donations, and purchasing decisions, they are answering these questions.

I am excited and optimistic about how we define ourselves in the future – for whatever that qualifier will be, humanity deserves our number one product to be saving and enhancing lives.

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