Promoting Nonprofit Organizations

A Reputation Management Approach

Ruth Ellen Kinzey

• Publisher: Routledge
• Year: 2013
• ISBN:
  9781136495939
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Relaciones públicas

Promoting Nonprofit Organizations is a practical guide to developing and implementing a strategic public relations program to enhance a nonprofit's reputation. The ways in which businesses – both for-profit and not-for-profit – communicate with customers has changed dramatically in recent years. Coupled with economic uncertainty, nonprofits have had to adopt a leaner operational mode, further underlining the need for organizations to take advantage of all the promotion strategies available to them.

This book:

• Discusses why public relations and reputation management go hand-in-hand with marketing efforts
• Offers a step-by-step guide to develop a public relations strategy
• Considers the importance of nonprofit sustainable citizenship
• Provides tips for reputation enhancement using a range of tools, such as social media and board ambassadorship
• Guides the reader in developing a reputation approach to crisis communication management

Highly practical in its approach, this book is a great guide for students in public relations and nonprofit management courses, as well as for professionals seeking to enhance the success of their nonprofit organization.

1 Welcome to the Not-for-Profit World

What I do, you cannot do; but what you do, I cannot do. The needs are great, and none of us, including me, ever do great things. But we can all do small things, with great love, and together we can do something wonderful.

(Mother Teresa of Calcutta)

What Is a Nonprofit?

Perhaps, jokingly. Perhaps, not. Companies sometimes say they are nonprofit because their business model just breaks even or, worse yet, their current financial records show them as operating at a loss. But just because a firm is not operating at a profitable level, does not qualify the business to call itself a not-for-profit entity.

In fact, there are marked differences between a for-profit and a not-for-profit. Some of these differences are:

Legally, a charity is required to serve its mission rather than to make a profit.

Although a nonprofit can engage in selling products or paid-for services and may compete with a company in this regard, its primary mission is to raise funds to support its mission.

Typically, unpaid community leaders, members, or other such individuals volunteer time and expertise to serve on the board of directors of the organization.

The nonprofit's board of directors is focused on meeting the needs of the community, its members, or other key stakeholders rather than on profit generation.

Any excess revenue generated through the sale of products or services is plowed back into the institution. This is so the organization can continue to serve its primary mission and ensures tax-exempt status is maintained.

Because the primary purpose of the nonprofit is to serve rather than make money, it is not in a position to pay full costs for the services and products it needs. Consequently, the organization may request nonprofit discounts from for-profit businesses.

Unlike a for-profit business, nonprofit employees are never expected to be compensated at a “higher than reasonable rate” for salaries, hourly pay, and benefits. If this occurs, public outcry is common, producing reputational issues for the organization.

The nonprofit typically serves people and causes that cannot afford to pay at the usual fee-for-service rate, if at all.

In the United States, there are several types of organizations that qualify for tax-exempt status, falling primarily within the 501(c) category. (See Box 1.1: U.S. Tax-Exempt Organization Reference Chart for 501(c) Entities and Box 1.2: Other IRS Tax-Exempt Categories.)

At times, the term “NGO” is used interchangeably with “nonprofit.” The acronym stands for “Non-Governmental Organizations.” This organization is legally constituted to operate separately from the government and not as a for-profit business. Even if an NGO receives partial or total funding by a government entity, it maintains its non-governmental status by excluding any government representation in its membership or board.

Typically, the term “NGO” is used with a nonprofit that has a social aim with political aspects unrelated to political parties. An example is a not-for-profit that focuses on advocacy issues, such as the Nature Conservancy. Smaller groups, such as local nonprofits focused on improving a community or its ecosystem, would be considered NGOs, too.¹

However, NGO is considered too broad of a name by some. These individuals prefer to use the term “private volunteer organization” or PVO.

The Status of the Nonprofit

The overriding purpose of a nonprofit is to meet a need or to solve a problem. Whether focusing on human services, saving the environment, improving the professionalism of an individual, or establishing a formal bond for those dedicated to a particular purpose or hobby, there is a common theme: the organization pursues a non-profit making mission. For this reason, donors and volunteers play a critical role in a nonprofit's ability to operate.

Volunteerism Today

According to the Corporation for National and Community Service, there were 62.8 million adults providing nearly 8.1 billion volunteer hours in 2010, with Generation X becoming a growing volunteer base and having devoted significantly more of their time to volunteerism than in the past.²

According to the U.S. Bureau of Labor Statistics, the volunteer rate rose 0.5 percent between September 2010 and 2011. This increase followed a decline of equal proportion in the previous 12-month period. While the overall percent was 26.8, the volunteer rate for women rose from 29.3 to 29.9 percent. Male volunteerism, which was at 23.5 percent, changed little. The volunteer rate for parents with children under 18 remained high at 33.7 percent. (This statistic obviously correlates closely with the increase in Gen X volunteerism.) And, individuals who possessed higher educational levels volunteered at a higher rate than those with less education.

Box 1.1 Entities U.S. Tax-Exempt Organization Reference Chart for 501(c)
IRS Publication 557: http://www.irs.gov/pub/irs-pdf/p557.pdf
501(c)(1)	Corporations organized under Act of Congress, including federal credit unions
501(c)(2)	Title Holding Corporation for Exempt Organization
501(c)(3)	Religious, educational, charitable, scientific, literary, testing for public safety, to foster national or international amateur sports competition, or prevention of cruelty to children or animal organizations. Subclasses include private foundations and public charities
501(c)(4)	Civic leagues, social welfare organizations, and local associations of employees
501(c)(5)	Labor, agricultural, and horticultural organizations
501(c)(6)	Business leagues, chambers of commerce, real estate boards, and other organizations focused on the improvement of business conditions of one or more lines of business
501(c)(7)	Social and recreation clubs, including hobby clubs, dinner clubs, country clubs, college fraternities and sororities, alumni associations, amateur hunting, fishing, tennis and other sports clubs
501(c)(8)	Fraternal beneficiary societies and associations
501(c)(9)	Voluntary employees’ beneficiary associations
501(c)(10)	Domestic fraternal societies and associations
501(c)(11)	Teachers’ retirement fund associations
501(c)(12)	Benevolent life insurance associations, mutual ditch or irrigation companies, mutual or cooperative telephone companies, etc.
51(c)(13)	Cemetery companies
501(c)(14)	State chartered credit unions, mutual reserve funds
501(c)(15)	Mutual insurance companies or associations
501(c)(16)	Cooperative organizations to finance crop operations
501(c)(17)	Supplemental unemployment benefit trusts
501(c)(18)	Employee funded pension trust (created prior to June 25, 1959)
501(c)(19)	Post or organization of past or present members of the Armed Forces
501(c)(20)	Group legal services plan organizations
501(c)(21)	Black lung benefi t trusts
501(c)(22)	Withdrawal liability payment fund
501(c)(23)	Veterans organization (created before 1880)
501(c)(25)	Title holding corporations or trusts with multiple parents
501(c)(26)	State-sponsored organization providing health coverage for high-risk individuals
501(c)(27)	State-sponsored workers’ compensation reinsurance organization
501(c)(28)	National railroad retirement investment trust
501(c)(29)	Co-Op health insurance issuers

Box 1.2 Other IRS Tax-Exempt Categories
501(d)	Religious and apostolic associations
501(e)	Cooperative hospital service organizations
501(f )	Cooperative service organizations of operating educational organizations
501(k)	Child care organizations
501(n)	Charitable risk pools
501(q)	Credit Counseling Organizations
521(a)	Farmers’ cooperative associations
527	Political organizations

The two most frequent volunteer activities are: fundraising and collecting, preparing, distributing, or serving food. Men and women volunteered in different ways. Men were more likely to volunteer time in general labor activities; then, coaching, refereeing, or supervising sports teams; and finally, fundraising. Women were more ...