Non-Governmental Development Organizations (NGDO) Performance and Funds—A Case Study

Abstract

Non-profit organizations (NPOs) are facing growing pressure to become more performance oriented. The existence of a rising number of NPOs and the scarcity of fund sources is an increasingly worrying scenario. Our case study examines the experiences of three non-governmental development organizations (NGDOs) and discusses the possible existence of a relationship among fund sources and organizational performance. Non-profits are gradually required to respond to performance measurement directives and their fund sources may be scarce, in terms of quantity and diversity. Two central findings emerged from interviews and document analysis. First, there is a relationship between funds and performance, additional/greater funds positively influence organizational performance. Second, funds diversity play a critical role on performance, diversification of funds sources reduces the dependence of organizations and consecutively improves their performance.

A SBM-DEA based performance evaluation and optimization for social organizations participating in community and home-based elderly care services

“…Therefore, social organizations are facing growing pressure to performance-oriented, when they mobilize the endowment of resources and deliver services [ 32 , 33 ]. Since Social organizations strive to the goal of public profit maximization [ 34 , 35 ], it is necessary to secure development of such organizations not just by an increase of subsidies, but mainly by proper managing systems and radical elimination of what is not bringing any value [ 36 ].…”

“…Performance management of social organizations are essential for decision-making for governments, funders, clients, donors and all stakeholders [ 37 ]. Performance measurement helps to clarify expectations, promote consistency, provide risk signals, allow precision and objective forecasts, promote motivation and improve solutions to problems, improve accountability and increase objectivity [ 32 ]. Taking into account that many social organizations need to create trust and confidence, it is the multiplication of benefits from performance measurement as well.…”

Practising what they preach? Development NGOs and the EU’s Emergency Trust Fund for Africa

“…They raise funds primarily in Northern countries from governments, multilateral agencies and individual donations, and channel these towards funding and implementing development or humanitarian actions in countries of the Global South. These actions generally focus on easing human suffering, reducing poverty, improving social justice and empowering the poor (Ferreira, Carvalho, and Teixeira 2017). NGDOs also carry out advocacy towards governments and international organisations, and raise awareness on the issues facing the global poor.…”

Corporate Propensity for Long-Term Donations to Non-Profit Organisations: An Exploratory Study in Portugal

“…This fact implies a fundraising strategy in charities (Wymer et al 2006). Fundraising requires the implementation of marketing principles in a proactive and competitive approach (AL-Tabbaa et al 2014) in order to achieve a diversity of funding sources and consequently better sustainable performance of NPOs (Ferreira et al 2017). The success of NPOs is attributed to their ability to diversify funding sources in response to current economic and political environments (Froelich 1999) and they should understand fundraising through donations as their main source of revenue (Carroll and Stater 2008), under the penalty of compromising their independence and mission.…”

“…In the context of raising uncertainty and economic constraints that may inhibit corporations from offering donations to non-profit organisations and reduce the level of philanthropic contributions (Dunn 2004), as well as the increasing competition for grants within the third sector, a diversified mix of funding sources has increasingly been considered a prudent strategy to reduce unpredictability, and also to show competency, to grow in economic value, and to be recognised as having managerial merit (Shumate et al 2018). Raising new donations is directly related to improvements in the financial performance and sustainability of NPOs (Ferreira et al 2017).…”