New Report: We Canít Afford to Do Business This Way

Posted in Financing the Sector , Nonprofit Action on March 16th, 2009

A Study of the Administrative Burden Resulting From Funder Accountability and Compliance Practices.

My research on the administrative burden resulting from funder accountability and compliance practices is now available. Undertaken with the support of the Wellesley Institute, the studies findings will help nonprofit organizations and their funders improve their effectiveness and responsiveness.

Some excerpts:

The findings are sobering. The administrative burden placed by funders on community nonprofit organizations is so heavy and so unrelenting, and places so many constraints on their ability to operate that it is a wonder they can deliver any services effectively.

The executive directors of these agencies describe an environment in which their key responsibility is to manage the demands of funders and the many constraints and problems funders impose on the organization so that the staff can actually get some work done and meet community needs.

In sum, the overload of information requests and filings, the lack of delegation of decision-making to the agencies, the problems caused by the granting processes, and the failure of funders to consult with grantees were all identified by participating organizations as contributing to the difficult administrative burden.

The data are clear: we canít afford to do business this way. It is in everyoneís interest to reform the funding process by minimizing the administrative burden and maximizing the flexibility of agencies to adapt, respond, and innovate, with a focus on results, not controls. It is urgent that funders, nonprofit organizations, and local communities come together to create new administrative systems that can most effectively support the objectives of improving community well-being.

Check out the eight page Executive Summary and the longer report containing the detail agencies and funders need to begin reforming the system.

Executive Summary (PDF)
Full Report (PDF)

If you need a black and white version of the report go to the Wellesley Institute Website

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