A closer look at the not-for-profit sector in Australia
The not-for-profit sector (NFP) is a fundamental part of Australian society that has recently undergone rapid growth and expansion. Working across all facets of the NFP sector, from causes to corporates and individuals, Benojo have noticed growing trends that have been backed by findings from the Cause Report by JBWere. We’ve used this report as a strategic tool for informing our personal growth, taking a holistic view of the NFP sector.
The present state of NFP sector
The NFP sector has grown significantly over the past 20 years with Australia now having one organisation for every 422nd person in the population.
This growth has been partially achieved through strong funding for the sector averaging 8.4% pa over the past 20 years. Corporate support for the NFP sector has grown much faster than other forms of funding, yet individual giving still comprises 50% of the total.
Despite the rapid growth of the NFP sector, the concentration of income and assets remains with the top 10% of organistaions. This often means that smaller causes are ignored, forgotten or simply unrealised.
We wanted to equal the playing field, making it easy for all types of causes to find a donor. We created a platform that links causes and for-profits making it free for causes to use, so even the smallest dog shelter can stand alongside Barnardos Australia.
This approach enables individuals to explore the diversity of causes and find something they truly care about (no matter how niche), tailoring giving to the individual and dismantling the hierarchy of causes.
Recently, there has been a focus on how to “operate profitable business activity that will also generate the social returns.” This means there has been a proliferation of social enterprises such as Crepes for Change and Who Gives a Crap?
From a business perspective, it is essential that businesses recognise the link between purpose and profitability. With 55% of Millennials willing to pay extra for products from companies with a positive social impact, businesses are being forced to implement an efficient CSR program if they are to compete with social enterprises and B Corps for a market share (in which Millennials influence 74% of buying decisions).
This recognition has led a growing part of funding for the NFP sector coming from business. When you combine donations ($863 million in 2013) and sponsorships ($1381 million in 2013) from the business sector, it represents 26% of the fundraising total.
In order to maintain and increase this kind of relationship, the report suggests it is important to understand agents of the NFP sector in terms of structure, assets, funding and size. This kind of knowledge can help donors in their search for a cause partner and ensure businesses align themselves with the right cause to prevent giving waste.
Where is it all heading?
Despite the rapid growth of the NFP sector, we need to identify and refine emerging trends to ensure its sustainable growth. The report details several trends that need to be nurtured in order for this to happen.
Using measuring tools as well as a scale against which giving activities can be measured will allow businesses and causes alike to evaluate their impact and processes, allowing them to innovate for future campaigns etc.
The rapid growth of the NFP sector has resulted in a proliferation of information about giving activity that needs to be shared. Sharing findings and results with the media will drive conversation well as creating case studies that corporates and causes can share during the Grow & Tell phase of Benojo’s Index.
Better corporate partnerships
The growth in shared value discussions and analysis inside for-profit organisation will naturally lead to more meaningful partnerships with NFP organisations. For-profits need to evaluate their company culture and resources so they can partner with causes that are likely to create shared value and thus more efficient social impact as per the Make it Matter stage of Benojo’s Index.
By the same token, NFPs need to better value the knowledge they bring to the relationship with for-profits and develop an understanding of how they are helping for-profit organisations in order to circumvent a power imbalance.
Although the rate of volunteers increases 4.1% annually, the age of the volunteer workforce rises. Organisations are experiencing difficulty in attracting younger supporters.
NFPs should look to for-profit organisations to provide a skilled volunteer force comprised of employee volunteers. Benojo helps corporates to manage their employee volunteers through a simple platform that allows hours to be tracked and programs evaluated, ensuring employees can find a cause that matters to them.
Overall the NFP sector needs to continue to evolve faster than it has in the past in order to sustain maximum impact.
The complete Cause Report can be found here for further advice, statistics and trends that are shaping the way we give.
A place to collaborate, donate and volunteer, Benojo is a social impact platform that connects the giving space.
Contact us to learn more about our work and how we could help you.