Associations and charities alike understand the need to
negotiate their way through changing patterns of contact and
response from government, and have seen how the government's
attitude to the ACNC and regulation of charities has changed
Not only is the intersection of not-for-profits and government
closely watched, but the boundaries between the sector and business
are becoming more and more blurred as they collaborate. There has
been a growth of hybrid relationships, focused mostly on raising
funds for projects that would not be possible if relying solely on
the government. This has seen new ways of looking at issues and
resolutions through collaboration, sometimes with unlikely
However, there is a great gap in understanding the various
structures being explored. Lester Salmon (Leverage for Good, 2014)
has explored these structures, from social enterprise and impact
investing to capital aggregators and enterprise brokers. The range
is dizzying: credit enhancement, quasi equity structures, venture
philanthropy and social impact bonds, all innovative ways to fund
Newly emerging online portals and exchanges may bring us closer
to the vaunted social stock exchange. Also, Philanthropy Australia
reported on Program Related Investments in November, which might be
applied by foundations making investments to "further their
charitable purposes, with the explicit understanding that those
investments will earn below-market returns".
Overall, the potential is great. A release by the ACNC in July
indicates it is developing its attitude toward the impact of new
philanthropic models. It is not lost on the commission that
charities need to attract investment, but in doing so must not lose
sight of their mission. Boards carry the risk and responsibility
for engaging in such ventures and not straying from their
Whatever model is used, government and business need measurable
outcomes, which have not been easy to provide. Digital technology
and Big Data may be the answer to gathering, collating and making
sense of results. Four parts of the economy should coalesce to
bring real opportunities to create measurable impact: government
establishing the appropriate environment; NFPs sharing knowledge of
the complexities being faced and adapting to new technologies;
business finding the funds and the methods to use them; and digital
technology to track, monitor and report outcomes. Already people
are asking, "Is there an app for that?". Charities could
embrace technology to find ways to collaborate more widely,
increase efficiencies and eliminate duplication.
The latest Australian Charity Report indicates that 5 per cent
of charities control 80 per cent of the sector's assets, while
a third of the sector has income of less than $50,000 a year. It is
heartening to see innovation in funding and relationship building
is thriving also at community level, where most organisations are
active, and where income is lowest.
Payback for Business
Social investment strategies can enable businesses to engage
with the community to create positive social outcomes, with the
payback that this leads to expanded markets for those businesses.
These strategies can often be tailored to the local level.
Local government has great potential to lead and foster
connections between private businesses and NFPs. Parramatta
council's Social Investment Office is strong on establishing
common ground and common mission, with the council's role being
to provide a forum and help in nurturing these innovative
All charities should consider using new technologies and
financial models, and developing a working relationship with
government and members of the business sector who are willing to
engage in business for purpose. NFPs of all types desperately need
such innovative thinking.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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