Nonprofits

In this series so far, I have suggested that it is possible to test "charitability" — at least in terms of transfers of resources from some class of donors to some class of recipients — by using a balance sheet approach to identifying how those donors and recipients match up. After all, they should be equal in size. Now I will examine two additional complications — past charitable contributions and transfers from government—and then conclude by reexamining some of the objections to the approach I have suggested.

All charities claim to be performing some good for others or for society. These "outputs" require inputs of charitable resources. Nongovernmental sources can be divided broadly into two major categories: financial or real capital, and volunteer labor. These contributions of money or property and time are typically tax favored. This article examines how the balance sheet exercise matching uses and sources of charitable "resources" can serve as a cross-check for how charitable an organization is.

How charitable are charities? Can a charity that provides education or healthcare and has no profits be "noncharitable"? The Senate Finance and House Ways and Means committees think those questions are so important that they have been examining whether and when nonprofit hospitals deserve tax exemption. Many state and local governments have done likewise. And apart from any possible action of the IRS or Congress or state legislatures, Independent Sector and other institutions serving and monitoring charities have been giving increased attention to how charities can more effectively achieve their charitable purposes. Even if there were no outside pressures, the community of consultants and advisers to charities would seek to find ways to measure success by more than sustainable budgets or outputs such as meals served or babies delivered. All those efforts at one level or the other raise the important and sensitive issue of measurement. I contend that there is one powerful tool that could be used by many nonprofit organizations to try to more effectively measure — at least in one important respect — whether they are "charitable" and, to some degree, the extent of their charitability. The measurement tool I suggest charities use is nothing more than the accountant’s most powerful tool: the balance sheet. However, the balancing exercise I am recommending goes beyond the traditional balancing of assets and liabilities and to what I will call the uses and sources of resources intended to achieve private charitable transfers.

Francie Ostrower, senior research associate in UI's Center on Nonprofits and Philanthropy, discusses the challenges of nonprofit governance and the implications of her recently published national survey of nonprofit boards, "Nonprofit Governance in the United States: Findings on Performance and Accountability" from the First National Representative Study.

Nonprofit boards are increasingly a focus of those interested in greater accountability and transparency, including policymakers, media, and the public. To help inform current policy debates and initiatives to strengthen nonprofit governance, in 2005 the Urban Institute conducted the first ever national representative survey of nonprofit governance, with over 5,100 participants. This report presents survey findings, discussing: relationships between public policy and governance, factors that promote or impede boards' performance of basic stewardship responsibilities, board composition and factors associated with board diversity, and recruitment processes, including the difficulty experienced by many nonprofits in finding members.

Many nonprofit boards are cut off from the public they serve by an ethnically homogenous membership and a failure to engage in externally oriented activities, says a new Urban Institute study.

A new volume of essays from the Urban Institute and a recent national policy roundtable in Washington zero in on recovery efforts in the Gulf Coast region and underscore lessons for rebuilding after future disasters.

This volume of essays presents the thoughts of leading researchers and policy experts regarding models and policies that can help guide the rebuilding efforts in the Gulf Coast region. The essays focus on six issue areas: affordable housing; services for children and families; strengthening the arts and culture community; public and environmental health concerns; rebuilding financial assets; and the role of nonprofits in preparing for the next disaster. Together, the essays lay an important foundation for developing action plans to address the underlying issues of poverty, inequality, and weak social infrastructures that have been persistent in the region for decades.

This report summarizes key facts and trends affecting the performing arts sector from 2001 and 2002. The data collected permits managers and observers of nonprofit professional producing companies, and presenters to take a common perspective on how they are financed and operated, to compare organizations of different disciplines and different size, and to explore changes from year to year.

Panelists discuss how the arts and culture community in New Orleans is faring in the wake of Hurricane Katrina. They talk about signs of renewal and the tools that will help ensure that arts and culture can be integral and valuable parts of the city’s renaissance. Listen to the podcast.