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If We’re Not for Profit, What Are We For?

5 April 2012 at 11:13 am
Staff Reporter
In the climate of the Federal Government’s ongoing reform of the charity sector, the CEO of World Vision, Tim Costello, asks are we achieving the community benefit we exist to serve?

Staff Reporter | 5 April 2012 at 11:13 am


If We’re Not for Profit, What Are We For?
5 April 2012 at 11:13 am

OPINION: In the climate of the Federal Government’s ongoing reform of the charity sector, the CEO of World Vision, Tim Costello, asks are we achieving the community benefit we exist to serve?

The last few years seen some intense discussion about the not-for-profit sector in Australia, not least because of the federal government’s ongoing reform of the charity sector. The creation of the Australian Charities and Not-for-Profits Commission is one of the key elements of this reform.

This won’t be the end of the reform process. The conversation about regulation and accountability will continue. But leaving aside the detail of reform proposals, it’s definitely for the good of the sector that we do everything possible to maintain and improve community confidence in the quality and integrity of our organisations. We should all welcome greater transparency and accountability.

But equally it’s important to remember what we should be accountable for. There’s much more to this than financial accountability, important though that is.

And this goes to the heart of what not-for-profits are. I’ve always thought it a bit strange to define something by what it’s not. At best ‘not-for-profit’ is a very one-dimensional concept. Our organisations may not be for profit, but we are for purpose.

So it’s that purpose that should be at the heart of how our organisations develop their strategy, how they carry out their work, and also how we hold ourselves accountable to those we serve, those who support us and the community as a whole.

It’s this purpose that gives leaders in our sector their special sense of mission. In the private sector, leaders are regularly reminded of the purpose they need to focus on. For-profit organisations are just that – they ultimately rise and fall on the extent to which they create shareholder value.
In the community sector it’s a little different. We too have boards and governance structures to hold us to account, and we work within a panoply of external regulatory frameworks as well as our own self-regulation instruments such as codes of conduct.

But our bottom line is never merely financial or to do with governance. Our organisations exist to meet a particular social need or benefit, and our true bottom line has to start with that. Are we achieving the community benefit we exist to serve?
This means that we need to measure impact and effectiveness, not just inputs and outputs. It means reporting not only on our financials but also on our program quality.

In many of the fields where NFPs work, such as health and community development, we are faced with complex situations where improving outcomes for people involves a long term view and a commitment to continuous reflection and learning. This is also something we should take responsibility for – the community doesn’t expect us to get everything right every time, but they do rightly expect us to learn from experience and work diligently to innovate and improve.

A purpose-driven leader can make all the difference in a NFP organisation. There are so many traps – like being distracted from purpose by the pressure of day-to-day problem solving. Or being so focussed on the organisation’s growth or financial health that the quality of programs, or the quality of relationships, is neglected.

NFP leaders also need to guard against burnout. Often we are called on to juggle multiple roles – trying to be the strategic thinker, the enabling manager, the efficient leader and the external ambassador all at once. It’s hard to do everything well and it’s easy to sacrifice the important for the urgent. To be a resilient leader means resisting the temptation to do everything and do it all at once. Instead we have to take the time to think carefully about our priorities, and there can be no stronger guide in this than a continual refocus on purpose.

Purpose is key to resilience in leaders and in the organisations we lead. In good times reflecting on how much remains to be done is what keeps us grounded. Facing setbacks and frustrations, what will keep you going and get you through is to keep focusing on the long-term goals and aspirations.

If we can crystallise our sense of purpose, if we can develop the art of resilient leadership – then we can take our organisations with us, and we can see and shape the future for the benefit of those we seek to serve. 

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One comment

  • Tim raises some very important issues that are even more apt in the current regulatory reform climate.

    The question of ‘Are we achieving the community benefit we exist to serve?’ is a complex one that requires more space than we have here. However, may I suggest some subsequent questions to illustrate:
    – Do we know precisely what benefit we are trying to achieve and how do we go about measuring our impact?
    – Do our funders and donors share those views and, if not, are we substituting activity around a cause for real measurable benefit (insert any Government-funded program here to illustrate)?
    – Are we someimes hiding behind an assertion that our benefits are intangible and unmeasurable instead of doing the hard work required to achieve a true understanding of our impact?
    – Do we sometimes put our heads in the sand because the answers to these questions may threaten our support and ultimately our jobs?

    This last issue leads me to resilience in leadership. The mutliple loads that Tim refers to go with the territory in a usually under-funded organisation with limited staffing, skills usually learned on the job the hard way and with limited opportunities to network with others in the same position. Re-focusing on purpose is always important but even if that’s spot on, the workload is no lighter as a consequence. That’s why I’d like to see a lot more discussion on what we can do to build capacity through training, development and mentoring, as well as providing career structures in the sector, portable benefits, and wages that reflect the skills involved.

    Which leads to my final point i.e. is it time we had a serious discussion about the the number of not-for-profits in our community and begin to question whether they can all possibly have a unique focus that necessitates their existence? My sense is that of we don’t have that discussion amongst ourselves soon, the community (and funders and donors particularly) will draw their own conclusions and act accordingly.

    It’s just possible that a more focused sector might more easily defend itself against unwarranted criticism, achieve more tangible outcomes with and for those we exist we serve, and provide a better skilled and better supported workforce that has some incentives to stick around to get the job done.

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