The corporate world loves to say that nonprofits and NGOs should act more like businesses. But the reality is that there are two things (at least!) that nonprofits, NGOs, charities and other mission-based organizations must do that corporations do not have to do:

• Nonprofits, NGOs and charities are focused on their mission, not profits. Helping the homeless, providing financial literacy classes to low-income community members, helping victims of domestic violence, working to reduce the number of stray and at-risk animals, providing live theater, offering dance classes, and various other activities may not ever see any financial return on investment (ROI) for a nonprofit, but they will provide lots of non-monetary, and very much essential, ROI for the community as a whole.

• Nonprofits, NGOs and charities have to be transparent about their expenses, in a way that corporations would never dare.

It’s that second bullet point that for-profit businesses would fight tooth-and-nail if it were a requirement for them, yet they will demand it of the third sector, and start poo pooing expenses they see as frivolous, but that they would never, ever scrimp on for themselves: copy machines, computers, software, salaries for expert staff, heating, cooling, water, electricity, staff health insurance, etc.

Like it or not, third sector, your organization has to be transparent about expenses. And that does not have to be a bad thing: there is absolutely no shame in wanting to pay expert staff to deliver the best services possible, for needing things like copy machines, computers, software, etc. Don’t shrink from talking about those expenses: affirm them, to show just how expensive it is to provide quality services toward your mission. Doesn’t the community or clients you serve deserve the best in whatever program or services you provide?

And don’t be surprised when your financial transparency leads to more donations!

For more information:

• Use Your Web Site to Show Your Accountability
• Web Site Design Suggestions for Nonprofits, NGOs and Small Government Agencies
• Provide detailed information about how and why your organization involves volunteers, as well as how people can volunteer

Tags: transparency, accountability, accountable, scrutiny, accounting, finances, donations, donating, funding, sponsorships, investment, investing