Pitcher Partners this week released its Not for Profit Survey, praising organisations for their increasing commercial focus but sounded a warning for the future.
“Income from commercial activities is increasing, which in tight economic times is a good strategy, but NFPs need to be careful to retain their focus,” said a spokesperson from Pitcher Partners.
“The increasing commercial focus has the potential to damage the NFP culture and reallocate valuable scarce resources from their core purpose. The drive to commercialise may mean organisations chase every opportunity, whether aligned with their mission or not. To support commercialisation organisations are upskilling, as evidenced by the increase of executives, mainly around business development, technology and finance.
“It is good to see the increasing professionalism of the sector, but it is important the organisation is confident it can get a good return on that investment.”
In the words of one respondent, ‘NFPs undertaking the hardest work for the least reward may start to compete for the easiest work, leaving the hardest work – to who?’
Conducted with law firm Russell Kennedy, the NFP Benchmark Survey Report builds on a previous report conducted in 2015.
Are Not for Profits at risk of losing their vision?
The increasing commercial focus has the potential to damage the NFP culture.
1 Comment
There are also surrounding “commercial activities” and the organisation’s status as an NFP. Commercial operations generally need to be “incidental to” the main operations of the NFP. Care needs to be taken when looking at “commercial activities”. It’s ok to operate in a commercial manner, and NFP’s need to do so, just be aware of the obligations and regulations around retaining the organisation’s NFP and charitable status!!