How can a nonprofit or a charity become significantly profitable? Answer: it can’t. But non-profits can create a comfortable living for a group of employees. Some of them, with particular skills, may earn surprisingly large salaries.
U.S. president George H.W. Bush famously characterized non-profits and charities as a thousand points of light. This endearing and romantic characterization may have insulated non-profits and charities from a penetrating look at the way they run their business. These entities are often viewed as a rag tag collection of do-gooders struggling to keep alive their well-meaning, though often tiny, operations doing endless battle with insolvency.
Alas, this view poorly represents many modern business non-profits, which may be focussed on their own financial success and longevity as much or more than they are focussed upon some social or charitable objective.
Can a non-profit organization be too business-y for its own good? A recent example in the United Kingdom occurred in Rochdale, a suburb of Manchester. There, two-year-old Awaab Ishak died because of his allergic reaction to mould. The apartment was full of it. His parents had pleaded over and over with the local housing association to please do something about this problem.
Their entreaties were ignored. When Awaab died, there was an angry national reaction to his death. In spite of this, senior executives with Rochdale Boroughwide Housing seemed blind to the fact that they had any responsibility at all for the situation. They preferred to blame it upon the ‘lifestyle’ of the parents1.
Just recently, another atrocious event occurred in a housing association–managed public housing building. Literally years of complaints and entreaties had been expressed by residents about the well-being of Sheila Seleoane, a single woman who was their neighbour. All to no avail. As with young Awaab’s problems with Rochdale Boroughwide Housing, Sheila Seleoane’s housing authority — Peabody — had more important business to attend to. When the Housing Association finally took notice and entered her apartment, they discovered that the Sheila had been dead for two and a half years.
What do incidents like this have to say about non-government entities that are, profit- constrained or not, still private companies? In particular, what about those that are operating under what seem to be a false flag labelled ‘non-profit?’
Some of those kinds of questions have been raised by the BBC: What we can learn from a lonely death in social housing
