Sailing through the winds of change

What does the horizon look like for the philanthropy and nonprofit (PNP) sector?

I believe the PNP sector’s future is a little like a Sydney-Hobart Yacht Race – it’s bound to be bumpy and competitive, some contenders might sink, but record outcomes are possible, especially if data-savvy people with leadership skills and an eye on the wider environment are at the tiller.

There is no doubt the PNP race to the future will be “climate-affected” globally. Environmental disasters could demand maximum response and divert funds from traditional giving. Already, revolutions like the National Disability Insurance Scheme are taking one part of the sector into unknown territory, and other winds of change in the wider environment are buffeting all organisations and sectors, raising the need for skillful navigation.

Forces to survive

In an era when strategy is ever more critical for survival and impact, it is worth reviewing a checklist of the six big forces that might affect social organisations or the people, animals or landscapes they serve…

Geo-political (issues such as globalisation, regionalisation, conflicts, ongoing refugee and terrorism crises).

Vanguard organisations are already reaching out to wealth sources in Asia, and more volunteering is being provided to and by refugees. A good service developed in Australia will have far easier market entry to a host of other nations in future, and we are already seeing local organisations licensing their programs to nonprofit organisations in other countries as a means of building sustainability.

Economic (remapping which countries, households, generations, wealth levels and even genders are most able to give or collaborate, or which need PNP support; and the growing “fourth sector” where social purposes and business methods merge to channel private investment capital for social good).

An example is the “democratisation” of giving, with more individuals at moderate wealth levels setting up sub-funds in community foundations or trustee companies. The “middle donor” will become the focus of more effort and care as organisations realise this cohort is committed and likely to give in other ways.

We are also likely to see more focus on incentives to give. Factors such as the escalating costs of essential medical services propelled by advanced technologies and the sheer numbers of our aging population will stretch the public purse, prompting more marketing and proposals for a wider array of giving structures.  

Business (redefined corporate values, for example, compelled by new-generation business thinking and consumer empowerment).

Some people claim the corporate social responsibility wave is over, but there is every indication business will continue to be a source of more giving and volunteering. As younger generations take the helm, business will continue to grow as a source of in-kind, financial, voluntary, pro-bono and low-bono support for nonprofit organisations able to speak their language.

Social (consumer and media nonprofit trust/accountability concerns; the rise in neurological/social psychology/social marketing studies into giving and volunteering; social media listening and online community management; and all forms of collective action from giving circles to workplace volunteering and beyond).

There is no doubt that giving and volunteering as a group has a powerful allure, and savvy organisations will find ways to engage with potential supporters as groups, such as workplaces, social groups or event teams.

Technological (affecting myriad aspects in a connected, mobile-enabled but also digitally divided world, including disintermediation as crowd-power cuts out the traditional charity model, big data, geo-targeting, instant benchmarking, real-time measurement, donor expectations, the need for greater organisational techno-skills, “high touch”/individualised client and donor engagement, and virtual volunteering).

Some organisations will work only in the technology zone, not bothering with the traditions of past channels, such as direct mail.  

Legal (blurred sectoral boundaries, facilitative vs. trammelling regulatory and taxation frameworks, and government/PNP relationships).

As an example, the impact of Australia having a charity commission (the Australian Charities and Not-for-Profit Commission) may be change in decade-long issues such as unharmonised state fundraising regulations).

To respond to these forces, there is a need for adaptable people, systems, ideas, structures, governance, funding models and policies. Is Australia’s race plan well-honed? That is a tough question, but no doubt our PNP sector could be more focused on future planning.

Leadership and education

As a sector, we need to continue activating the strategic trigger points for impact, and to lift the level of the body of knowledge.

For the growing number of academic PNP centres in the Asia Pacific and professional associations providing training, this means fostering more leaders/reflective practitioners/influential alumni through education in order to build resilient organisations. Nonprofit personnel and their management and boards alike will be focusing more on skilling up to combat a looming nonprofit leadership drought.  

At the same time, with the growth of philanthropic trusts demand will increase for grantmaking expertise. Without education, there will be a skills shortage in this area as well.  

If NP employers do not have the resources to enable their staff to undertake education and training, there may be a swing to Massive Open Online Courses (MOOCs) and more gifting of training spaces to nonprofits by corporations running their own training.

Of course, some topic areas will be boutique and exclusive to nonprofit life. For instance, specialists in major gift fundraising and bequest liaison will both stay in demand as these areas grow as revenue bases for more and more nonprofit organisations.

The demands of the future may see the silos topple because the sector needs to galvanise a cohesive sector vision and policy. The push will continue for evidence-based, highly engaged, credible and inspiring research on the topics that count, and with which the sector and community engage.

Nonprofit workers and volunteers will need to embrace different expertise – neuroscience, jobs futures, accountability systems, big data and business intelligence – underpinning this with a strong framework of theory.

An eye on the future means the sector should engage with the big research pieces, like Giving Australia, that build the data needed to plot a good course. Funded by the Department of Social Services and an initiative of the Prime Minister’s Community Business Partnership, Giving Australia is the largest research ever undertaken into giving and volunteering in this country, and is a joint effort by ACPNS, CSI Swinburne and the Australian Centre for Corporate Public Affairs, through sector partners Volunteering Australia, the Foundation for Rural and Regional Renewal, Philanthropy Australia and Fundraising Institute Australia.

By Associate Professor Wendy Scaife, Director, Australian Centre for Philanthropy and Nonprofit Studies.

This article was originally in Third Sector’s June print Magazine- subscribe here.