See also
- Advocacy group
- Foundation (nonprofit organization)
- International organization
- Mission-based organization
- Philanthropy
- Social economy
- Social entrepreneurship
- Social threefolding
- Three-sector model
- Volunteer
- Volunteerism
Examples:
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The voluntary sector, independent sector, or civic sector is the realm of social activity undertaken by organizations that are non-governmental nonprofit organizations. [1] This sector is also called the third sector, community sector, and nonprofit sector, [2] in contrast to the public sector and the private sector. Civic sector or social sector are other terms for the sector, emphasizing its relationship to civil society. Richard Cornuelle coined the term "independent sector" and was one of the first scholars to point out the vast impact and unique mechanisms of this sector. [3] Given the diversity of organizations that comprise the sector, Peter Frumkin prefers "non-profit and voluntary sector". [4]
The presence of a large non-profit sector is sometimes seen as an indicator of a healthy economy in local and national financial measurements. [5] With a growing number of non-profit organizations focused on social services, the environment, education, and other unmet needs throughout society, the nonprofit sector is increasingly central to the health and well-being of society. [6] Peter Drucker suggests that the nonprofit sector provides an excellent outlet for a variety of society's labor and skills. [7] In 1976, Daniel Bell predicted that the third sector would become the predominant sector in society, as the knowledge class overcame the effects of the private sector. [8]
[9] The first two decades of the 20th century were characterized by a public zeal for social reform and social justice known as the Progressive Era. The newly founded National Association of Societies for Organizing Charity had immediate influence during that era. Its extensive field work helped organize new societies and strengthen others. Smaller cities became well-organized, with the South and Northwest particular areas of focus. To permit membership of Canadian societies, the association changed its name in 1912 to the American Association of Societies for Organizing Charity. In 1917, it became the American Association for Organizing Charity. These agencies increasingly were providing direct service to individuals and families. Pauperism, child welfare, juvenile justice, sanitation, tuberculosis, and other health issues were emergent problems for new and existing agencies. The American Red Cross fueled a nationwide fervor for social service. Founded in the United States in 1881, it was reorganized in 1905 to focus on military personnel. With this pivotal decision, the business of organizing charities quickly evolved into the business of social work.
According to a recent study by Johns Hopkins University, the Netherlands has the largest third sector of 20 countries across Europe. [10] Ireland's non-profit fundraised income formed 0.33% of Irish GDP, less than the UK and US, in 2016. [11] In Sweden, the nonprofit sector is attributed with fostering a nationwide social change towards progressive economic, social and cultural policies, [12] while in Italy the third sector is increasingly viewed as a primary employment source for the entire country. [13]
In the United States, approximately 10% of GDP is attributable to the third sector. Donating to private religious organizations remains the most popular American cause, and all religious organizations are entirely privately funded because the government is limited from establishing or prohibiting a religion under the First Amendment. [14]
Although the voluntary, community, and not-for-personal-profit sectors are frequently taken to compose the "Third Sector" each of these sectors or sub-sectors have quite different characteristics. The community sector is assumed to comprise volunteers (unpaid) while the voluntary sector is considered to employ staff working for a social or community purpose. [15] In addition however, the not-for-personal-profit sector is also considered to include social firms (such as cooperatives and mutuals) and more recently governmental institutions (such as Housing Associations) that have been spun off from government, although still operating fundamentally as public service delivery organizations. These other types of institutions may be considered to be quasi-private or quasi-public sectors rather than stemming from direct community benefit motivations.
There have been long-ranging arguments regarding the financial accountability of the nonprofit sector throughout Western society. [16] There is also ongoing concern whether the nonprofit sector will unequally draw retiring workers from the private sector as the currently large baby boomers age. [17] Development of the third sector, it is argued, is linked to the restructuring of the welfare state and further globalization of that process through neo-liberal strategies of the Washington consensus. [18]
In a 2013 New York Times op-ed and radio podcast, The Charitable-Industrial Complex, Peter Buffett uses the terms "philanthropic colonialism" and "conscience laundering", and describes his insights into "searching for answers with their right hand to problems that others in the room have created with their left" rather than systemic change. [19] [20]
Discourse on the "third sector" began in the 1970s in France as a result of the crisis in the welfare state. Many associations rely at least partly on government subsidies or other payments, it has been criticized at times by association heads (among some), as a way to control charities, some charities do refuse all government payments, while others try to rely partly on gov's aid. [21]
In India, this sector is commonly called the "joint sector", and includes the industries run in partnership by the state and Private Sector. In a wider sense the initial investment is made by the state and later the handling is done by the private sector. But here the private sector is responsible to the state when it comes to handling.
In Israel, this sector is commonly called the "Third Sector", (Hebrew : המגזר השלישי) and generally refers to non-profit organizations (NPOs) and non-governmental organizations (NGOs) with the line between the two quite fine. These organizations generally fill a gap in the existing government or municipal service provision. Examples include United Hatzalah for emergency medical first response, Yad Sarah for free loan of medical equipment, Yad Eliezer for poverty relief efforts, Akim for assistance for the mentally handicapped, and SHALVA for children with special needs.
The Cabinet Office of the British government until 2010 had an Office of the Third Sector that defined the "third sector" as "the place between State and (the) private sector." [22] The Conservative/Liberal Democrat Coalition Government renamed the department the Office for Civil Society. The term third sector has now been replaced in Government usage by the term Civil Society, or for a while under the Cameron government, the term Big Society, which was devised by political advisers and which featured prominently in the Conservative Party's 2010 election campaign.
The U.S. nonprofit sector consisted of approximately 1.56 million organizations registered with the Internal Revenue Service in 2015. These reporting nonprofits identified $2.54 trillion in revenues and $5.79 trillion in assets in 2015. Over $400 billion in revenue comes through private support and fundraising. [23] The U.S. nonprofit sector contributed an estimated $985.4 billion to the U.S. economy in 2015, composing 5.4 percent of the country's gross domestic product and employed 11 percent of the U.S. workforce in 2015. [24] Each year, seven out of ten Americans donate to at least one charitable cause. Contributions are from two to 20 times higher in the U.S. than in other countries of comparable wealth and modernity. [25]
Examples:
A nonprofit organization (NPO) or non-profit organization, also known as a non-business entity, or nonprofit institution, and often referred to simply as a non-profit, is a legal entity organized and operated for a collective, public or social benefit, as opposed to an entity that operates as a business aiming to generate a profit for its owners. A nonprofit is subject to the non-distribution constraint: any revenues that exceed expenses must be committed to the organization's purpose, not taken by private parties. An array of organizations are nonprofit, including some political organizations, schools, business associations, churches, social clubs, and consumer cooperatives. Nonprofit entities may seek approval from governments to be tax-exempt, and some may also qualify to receive tax-deductible contributions, but an entity may incorporate as a nonprofit entity without having tax-exempt status.
Philanthropy is a form of altruism that consists of "private initiatives for the public good, focusing on quality of life". Philanthropy contrasts with business initiatives, which are private initiatives for private good, focusing on material gain; and with government endeavors that are public initiatives for public good, such as those that focus on the provision of public services. A person who practices philanthropy is a philanthropist.
Fundraising or fund-raising is the process of seeking and gathering voluntary financial contributions by engaging individuals, businesses, charitable foundations, or governmental agencies. Although fundraising typically refers to efforts to gather money for non-profit organizations, it is sometimes used to refer to the identification and solicitation of investors or other sources of capital for for-profit enterprises.
A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being.
A social enterprise is an organization that applies commercial strategies to maximize improvements in financial, social and environmental well-being. This may include maximizing social impact alongside profits for co-owners.
The social economy is formed by a rich diversity of enterprises and organisations, such as cooperatives, mutuals, associations, foundations, social enterprises and paritarian institutions, sharing common values and features:
The term nonprofits research is used to describe the academic enterprise devoted to teaching and research on nonprofit organizations and non-governmental organizations (NGOs), voluntary associations, voluntarism and voluntary action, philanthropy, civil society, and related activities. It is a loosely bounded, multidisciplinary, practice-oriented community.
Marketisation or marketization is a restructuring process that enables state enterprises to operate as market-oriented firms by changing the legal environment in which they operate.
Laws regulating nonprofit organizations, nonprofit corporations, non-governmental organizations, and voluntary associations vary in different jurisdictions. They all play a critical role in addressing social, economic, and environmental issues. These organizations operate under specific legal frameworks that are regulated by the respective jurisdictions in which they operate.
The practice of charity, which is the voluntary provision of assistance to those in need, serves as a humanitarian act, and is unmotivated by self-interest. Various philosophies about charity exist, with frequent associations with religion.
Lester M. Salamon was a professor at Johns Hopkins University. He was also the director of the Center for Civil Society Studies at The Johns Hopkins Institute for Health and Social Policy Studies. Salamon has written or edited over 20 books in addition to hundreds of articles, monographs and chapters that have appeared in Foreign Affairs, The New York Times, Voluntas, and numerous other publications. He was a pioneer in the empirical study of the nonprofit sector in the United States, and is considered by many experts in his field to have been a leading specialist on alternative tools of government action and on the nonprofit sector in the U.S. and around the world.
A foundation in the United States is a type of charitable organization. However, the Internal Revenue Code distinguishes between private foundations and public charities. Private foundations have more restrictions and fewer tax benefits than public charities like community foundations.
Voluntarism, sometimes referred to as voluntary action, is the principle that individuals are free to choose goals and how to achieve them within the bounds of certain societal and cultural constraints, as opposed to actions that are coerced or predetermined. The term "voluntarism" is derived from Latin word "voluntary," which means 'will'. The term voluntary association is variously defined. Voluntary organizations are known by several other names: non-governmental organisations (NGOs), private voluntary organizations (PVOs) and so on depending on the geographic area and time period of reference. In general these organizations, regardless of terminology used, have certain characteristics; that they are non-government and non profit, that they are voluntary. The term NGO has become popular in the 1980s and 1990s and is extensively used in the field of development, where as the term "voluntary organization" had been used widely for social welfare and charity organizations. But these two terms are used interchangeably as both denote the same characteristics.
The Commission on Private Philanthropy and Public Needs, better known as the Filer Commission, was formed in 1973 to study philanthropy, the role of the private sector in American society, and then to recommend measures to increase voluntary giving. Organized as a privately supported citizen's board, the Commission came into being through the efforts of John D. Rockefeller III, Wilbur D. Mills, George P. Shultz, and William E. Simon. The selection of participants on the Commission reflected a desire for diversity of experience and opinions and included heads of religious and labor groups, former cabinet secretaries, corporate and fd Foreign Securities Corporation and President of Metropolitan Museum of Art.
The RGK Center for Philanthropy and Community Service is a research center at University of Texas at Austin located in the Lyndon B. Johnson School of Public Affairs. The teaching and research of the RGK Center are focused in the areas of nonprofit organizations, philanthropy, social entrepreneurship, and volunteerism.
Philanthropy in the United States is the practice of voluntary, charitable giving by individuals, corporations and foundations to benefit important social needs. Its long history dates back to the early colonial period, when Puritans founded Harvard College and other institutions. Philanthropy has been a major source of funding for various sectors, such as religion, higher education, health care, and the arts. Philanthropy has also been influenced by different social movements, such as abolitionism, women’s rights, civil rights, and environmentalism. Some of the most prominent philanthropists in American history include George Peabody, Andrew Carnegie, John D. Rockefeller, Henry Ford, Herbert Hoover, and Bill Gates.
Julian Wolpert is Bryant Professor Emeritus of Geography, Public Affairs, and Urban Planning at Princeton University's Woodrow Wilson School, where he taught from 1973 to 2005 and chaired the Program in Urban and Regional Planning. He was previously a member of the Regional Science Department at the University of Pennsylvania (1963–73).
Brian O'Connell was an American author, academic, and public administrator who helped found Independent Sector, an organization that represents the interests of charities, foundations and nonprofit giving programs in the United States.
A charitable for-profit entity is an organization that exists to serve a charitable mission but is legally organized as a for-profit corporation. Both benefit corporations and Low-profit limited liability companies (L3C) fall under this category. As well as generating a profit, a charitable for-profit entity concentrates on setting a social objective. The business must achieve its social purpose as well as have a profit income if it is to be successful. Lately, there are movements to refine strategies, retuning community-oriented activities based on ROI of Little Investment or Small Capital, Low Risk, yet, higher return and rebranding nonprofit entities from wholly-dependable funding beneficiary from Governments or public i.e. business organization or individual. previously, we often heard of Nonprofits and community-based organizations, now, For-profits community-based Social Enterprises The case of organizing charitable work under for-profit rules rather than as a traditional charity such as a foundation gained prominence when Google announced its Google.org branch in 2006. Since then, the subject has been under both academic and public debate with U.S. law professor Eric Posner arguing in favor of expanding Charity law to include for-profit charities, while Brian Galle considered the legislative popularity of social enterprises a "race to the bottom among states competing to siphon away federal tax dollars for local businesses."
Charity assessment is the process of analysis of the goodness of a non-profit organization in financial terms. Historically, charity evaluators have focused on the question of how much of contributed funds are used for the purpose(s) claimed by the charity, while more recently some evaluators have placed an emphasis on the cost effectiveness of charities.
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