J IM ABBOTECONOMICS 370
PROF. DAVID WILLIAMSAGNES SCOTT COLLEGE
SEPTEMBER 27 , 2016
Nonprofit Organizations:Thinking & Acting With An Entrepreneurial Mindset
What is a nonprofit organization?
Reinvests profit or net income, rather than distributing it to members, directors, or officers.
Exempt from taxation if it benefits the broad public interest (= charitable 501(c)(3) organization)
Donors to 501(c)(3) allowed to deduct their contributions when calculating taxes
Legally, two types of 501(c)(3): public charity (multiple sources of revenue, has program services) versus private foundation (one donor, make grants to other orgs and individuals)
All nonprofits: Agnes Scott College, High Museum, Zoo Atlanta, Atlanta Symphony, Emory Healthcare, American Red Cross, CARE International, Georgia Aquarium, Coca Cola Foundation, Woodruff Foundations
Also: Party With A Purpose, Atlanta Santa Run, Metro Atlanta Beekeepers, Male Action Coalition, Humanitys Advancement Toward Saving Our Fumdamental Future [sic]
For Profit vs. Nonprofit
For Profit NonprofitOwned by someone (an entrepreneur or stockholders)
Not owned by anyone
Chief goal is generating profit Chief goal is fulfilling mission to benefit the general public
Competes with other businesses Often collaborates with other orgsCan raise capital to invest in growth, in exchange for ownership stake
Donors and creditors, not investors, are sources of funds needed for growth
Revenue from sale of goods and/or services
Revenue comes chiefly from charitable donations
(Privately held) companies can operate largely outside of public view
Law requires nonprofits to operate with high degree of transparency
Volunteerism no part of this model Nonprofits often rely heavily on volunteers
By Category of Service to the Public
Quick Stats on Nonprofits in U.S.
1,097,689 public charities105,030 private foundations
9.2% of all wages and salaries paid (2010)5.3% share of GDP (2014)
$1.74 trillion revenues by public charities (2013) $1.63 trillion expenses by public charities (2013)
Growth in Nonprofit Sector
Breakdown by Size
Total Economic Impact of Arts Orgs in U.S.
Georgia’s Nonprofit Sector: Employment
Georgia’s Nonprofit Sector: Compensation
Nonprofit Volunteering in Georgia
Critical Needs in Our Communities
Challenges, Challenges, Challenges
Challenges, Challenges, Challenges
My Three Organizations
Missions of My Three
Trees Atlanta: To protect and improve Atlanta's urban forest by planting, conserving, and educating.
Ogeechee Riverkeeper: To protect the Ogeechee, Canoochee, and coastal rivers.
Atlanta Boy Choir: To achieve the highest possible standard of musical excellence, while instilling in its members a life-long appreciation of music; an abiding love of beauty; a keen sense of respect for themselves and others; and the self-discipline necessary to become effective leaders in their families, their communities, and the world.
Sizes of My Three (Operating Expenses in 2014)
Trees Atlanta: $2,092,147
Ogeechee Riverkeeper: $172,542
Atlanta Boy Choir: $360,836
Trees Atlanta: Outcomes in 2015
Trees Atlanta: Outcomes in 2015
Trees Atlanta: Outcomes in 2015
Ogeechee River Fish Kill
Ogeechee Riverkeeper sued a textile mill in 2012 for violations of the Clean Water Act believed by some to have been the cause a massive fish kill in May 2011. After a lengthy legal battle, the lawsuit was settled in January 2014. The settlement agreement puts in place comprehensive and stringent environmental protections and establishes programs to aid in restoration efforts along the river.
Value in the Nonprofit Sector
“[W]e learned that becoming a high-impact nonprofit is not just about building a great organization and then expanding it to reach more people. Rather, high-impact nonprofits work with and through organizations and individuals outside themselves to create more impact than they ever could have achieved alone. They build social movements and fields; they transform business, government, other nonprofits, and individuals; and they change the world around them.”
Heather McLeod Grant & Leslie R. Crutchfield, “Creating High Impact Nonprofits,” Stanford Social Innovation Review (Fall 2007)
Value in the Nonprofit Sector
Serve and advocate for legal and policy changes, because they realize that they cannot achieve large-scale social change through service delivery alone.
Make markets work, by finding ways to work with businesses and help them “do good while doing well.”
Inspire evangelists, by building strong communities of supporters who help them achieve their larger goals.
Nurture nonprofit networks, by sharing wealth, expertise, talent, and power with other nonprofits with similar missions.
Master the art of adaptation, by modifying their tactics as needed to increase their success.
Share leadership, by distributing it within their organizations and throughout their external nonprofit networks, thereby empowering others to lead.
Factors Affecting Nonprofits
NPO
Clients’ Needs
Donors’ Demands
Social & Political Trends
TechLaws &
Regs
Other NPOs
Brand/Reputatio
n
My story
“Inspiring Evangelists”
First TA Project 1998
Inman Park Tree
Watch 2000
Friends of the
Ogeechee 2001
Ogeechee Riverkeeper (ORK)
2004
FYS: Trees and
Forests 2006
Inman Park
Arboretum 2007
ORK fights new
power plant on
Ogeechee 2008-2010
FYS: Trees and
Forests 2010
Fish Kill on the
Ogeechee 2011
Agnes Scott
Arboretum 2012
GUFC College Canopy
Conference 2015 &
2016
Effects and Second-Order Effects
Inman Park Tree Watch
1000 new neighborhood
trees since 2000
Georgia Power tree trimmer: “I’m never coming back
here!”
First Year Seminar
30 women more closely attuned to
natural world
Alumna who is now project
manager at the Emerald Corridor
Foundation
ORK Opposition
to Coal-Fired Power Plant
Corporation abandons plans to
build plant
Child thrives in Head Start,
without cognitive impairment from fetal exposure to methylmercury
Case Study for Discussion
Should (some) drug companies be nonprofit?
DO YOU HAVE A NONPROFIT STORY TO SHARE? WHAT DO YOU
THINK WOULD MAKE THAT ORGANIZATION MORE VALUABLE
TO THE COMMUNITY?
What about you?