As busy people, we like to look at things as black and
white, divided carefully and completely into separate categories. This thing goes
in that box. Check. Done. The goals and roles of various institutions are no
different. When we think about the work of government, we try to categorize it
into a few main boxes: collecting taxes, managing the military, doling out
Social Security checks. For-profits (i.e. corporations) exist, we might
believe, solely to make money by selling us something or performing some task
for us. Check. Non-profits are tasked with handing out charity. Done.
In the minds of many, these three sectors stay in their own
lanes. The reality of it, however, is that there is a much deeper interplay
between them. Certainly, all three sectors are likely to have some different
roles in our lives and our communities, but they ought not to be so rigidly
categorized.
David O. Renz traces the history of this interplay from the
founding of the United States, when voluntary associations, the precursor to
modern non-profits, were distrusted as tools of the wealthy to increase their
standing, to the dramatic rise of foundations and charitable giving in the 19th
century, then embraced by Americans as they sought to enact social reforms. Over
the last 100 years, as government has increased dramatically in both scope and
in scale, the number of issues that have direct impacts on society, and have
attracted dedicated supporters and detractors, has likewise skyrocketed.
Non-profits have arisen as a powerful tool to enable citizens to influence
government policy, in many cases serving as advocacy organizations rather than providing
direct services to the needy.
As Howard Berman points out in The McNerny Forum, in today’s political climate, where the idea of
government spending is often frowned upon by a majority of the electorate,
non-profits are there to fill a void. Tight governmental budgets mean tough fights,
and often even tougher losses, for program funding. Advocacy organizations, or
non-operating organizations, fulfill their charitable role by working to bring
about knowledge of the issues and the impacts of cuts to funding or inaction.
Their work is to influence government, to humanize the political process and
its ramifications. And when cuts are made, or when government simply cannot
meet the social welfare needs of its citizens, operating non-profits yet again
step in to fill this gap. In turn, government often recognizes the important
role of non-profits, both as advocates for causes and groups who might
otherwise go unnoticed and as providers of direct aid, through various funding
structures that enable non-profits to exist. Each sector is deeply influenced
by the other.
Similarly, the public and private sectors interact in ways
that are not always readily apparent. Whereas most think of corporations as
profit-seeking organizations, many for-profits employ the concept of corporate
social responsibility – or, as Berman puts it, doing “good” instead of just
doing “well.” Corporations have learned that a healthy, stable community is
good for business, but typically not within the expertise of the corporation
itself to undertake. Here again, non-profits fill a void. Their role as
on-the-ground actors enables businesses that seek to do “good” in their communities
to find the right ways to have a real effect on individuals.
These three sectors each function with their own roles
within society. They do not, however, function within a vacuum. Instead, there
is a delicate but omnipresent interplay between them. Where government may fall
short, non-profits may step in to provide services. Where non-profits need
institutionalized support, government may provide this in the form of funding.
And where business seeks to expand its impact beyond profit for shareholders,
non-profits may enable them to do so efficiently and for the greatest good.
Sources:
Renz, David O, ed.
2010. The Jossey-Bass Handbook of Nonprofit Leadership and Management.
Jossey-Bass. San Francisco, CA.
Berman, Howard J.
2002. Doing "Good" vs. Doing "Well": The Role of Nonprofits
in Society. Inquiry 39: 5-11.
