Should Charities Be More Commercial?
How many charities have a fee for service revenue line?
Hospitals, lots of cultural, place-based charities, the entire public broadcasting world…more than you might think.
Does having a commercial revenue line create conflict with service delivery to beneficiaries? Or how about community building? It may be hard to be inclusive if you make more profit by charging more and that demand curve is elastic.
A Belgian study was done that myth busts some of this thinking. You can find the study here but there is probably a pay-wall.
But the TLDR version is wrapped in a bow with this chart that qualitatively shows what they found with their very quantitative analysis.
Here is how to read this:
- Commercialism is shorthand for having a profit making revenue line – e.g., selling something.
- The other two, management tool use and performance measurement are a nod to further professionalizing and bottom-lining your accounting and other operational parts.
- The Theory column is a review of what academics have long thought and found some support for in other work. A ‘-‘ sign means theory and/or past research would suggest a negative relationship between mission (columns) and being more like a for-profit. The “+” being a theorized positive relationship – be more like a business, do more good.
This study found that being more like a business has either no effect – good or bad – or a positive one on mission.
Kevin
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