Making a profit not the answer for nonprofits |

Making a profit not the answer for nonprofits

Kris Marsh

(Editor’s note: The following column is in response to the story “Local philanthropist wants to help nonprofits change their financial ways,” published in the Wednesday, July 13 issue of The Aspen Times.)I was dismayed to read in The Aspen Times July 13 issue that the old disparaging rhetoric about not-for-profits has reared its ugly head again. The idea that organizations committed to working toward the common good and tackling the most pressing social problems and issues are somehow operating in an un-businesslike manner and thus are fatally flawed will not fly. This attitude is pejorative and unfair.Most nonprofits are extremely well managed because they have solid professionals running them and volunteer boards with diverse expertise who provide good oversight. Due diligence is also provided by funders, governmental regulations and watchdog agencies. There are extensive professional standards for caregivers and service providers, for professional fundraisers and administrators. The field of nonprofit management and fundraising has never been more business-like. Great attention is paid to financial accountability and responsibility, program evaluation and outcome measurement. Most funders and donors expect that and receive it; otherwise they will take their charitable funds elsewhere. But good fiscal management is only part of the story.What seems to disturb some peo-ple is that these organizations serve a purpose that is different than making a profit and somehow profit is what really counts. Well, there is another way to look at this. There is a role for nonprofits and that is serving a purpose and mission higher than the bottom line. And that’s more than just okay. It’s critical to the well-being of everyone in our society – from the kids who attend private schools, to adults receiving mental health care at our local counseling center on a sliding fee scale, to expectant mothers with no insurance, to lovers of great art and music, to people in need of good medical care, to the young, the old, the sick and the suffering and to all who seek a meaningful quality of life. It’s about providing programs and services, even though in doing so, there will only be a small excess in revenue, or a break-even situation or even a deficit. It’s about meeting needs, not making money, doing what is right and compassionate, not doing what is necessary, sometimes even ruthless, just to be financially ahead. Sometimes a bottom line mentality just gives people an excuse to do bad things to good people in order to prove they are guided by fiscal responsibility. In non-profit work, it’s about what we do and how we do it, not how much money is exchanged. It is about the journey as much as it is the destination.The move to social entrepreneurship for nonprofits is not a very new idea. It was promoted several decades ago and it was proven to be a dismal failure. I saw the aftermath of these failures when I moved to Denver in the late 1980s. Nonprofits were convinced to begin business ventures to augment their revenue and to become self-sufficient, reducing their need for fundraising (just what a local Saturday workshop is promoting). People running nonprofits were forced by their business-oriented board members to expand their skill sets and become more financially entrepreneurial in their approach. However, the result was that the mission and the true work of the organization were neglected; the business enterprises drained the human and financial resources of the organizations, leaving many groups in worse shape than before. Even the guy who developed and promoted this idea closed his consulting business because of this lack of success.One of the stimulants for “business is best” kind of thinking stems from the extreme dislike for fundraising. Everyone seems to hate fundraising these days. Attacking fundraising as begging, however, shows a lack of respect for what true philanthropy is at its core. Admittedly, there is a lot of fundraising that is distasteful – telemarketing, glitzy events, strong-arm tactics. But when done properly, fundraising is a most noble endeavor. It provides a way for well-intentioned people to share their financial resources, voluntarily, with worthy organizations that are fulfilling a mission that meets important community needs and which resonate in a real way for the giver. It’s a way that a person who has had financial success in their life can give back and can make a difference in something they feel is important to society. And when a person gives a meaningful gift – coming from the heart – with no interest in getting anything in return – not a plaque or a neon sign or a seat in the VIP section – then fundraising is a means to uplift a person to a place of self-transcendence, not self-aggrandizement. And we begin to experience a community where people care as much for their neighbors as they do for themselves. If only we could value the work of nonprofits with respect and appreciation instead of trying to remake them into reflections of our own experience. It is up to us to do our due diligence before we contribute – to do our homework and make sure the organizations to which we contribute have the highest standards of program management and fiscal responsibility in order to give out of the purest of intentions – to meet important community needs for the benefit of all and making that the bottom line.Kris Marsh is president and CEO of the Aspen Valley Medical Foundation.

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