The End of Mom and Pop Nonprofit Shops?
MSNBC reported a new poll by Harris Interactive released this summer found only one in 10 Americans strongly believes charities are "honest and ethical" in their use of donated funds. And nearly one in three believes nonprofits have "pretty seriously gotten off in the wrong direction."
Unfortunately, those numbers have been pretty consistently upsetting over the past decade. Responses advanced to shore up donor confidence have tended to focus on tighter regulation or capacity building of individual nonprofits. Having worked in the sector as both a nonprofit executive and foundation grantmaker, I feel pretty confident saying neither will work to "fix" the problem because the whole system that drives resource allocation is itself badly broken. Nonprofits get money based on who they know, not what they do. And demonstrating that you do better work than the next agency has been ridiculously elusive.
The more I blog, the more I realize that a new day is coming in short order. Approaches will emerge that enable both individual and institutional donors to understand where they might contribute gifts and time more effectively. Donors will begin to grasp the idea of competitive shoppping in the philanthropic sector, driven by new understanding that all philanthropic dollars are not given equally.
Meeting with the board of a community foundation in the South last week, I was struck by the feeling that in five years we will see the end of charitable funding as we have known it in big cities. Smaller towns, and the ecosystem in which they have supported nonprofits, won't be too far behind. Could we all be on the way to some transformation as basic as the death of the "mom and pop" nonprofit shop?
P.S. In addition to being a terribly sad comment on the state of affairs, the article is part what appears to be systematically expanded coverage of philanthropy by MSNBC. Check out their wide ranging articles as well comments from a good number Janes and Joes on the survey results.