The Effect of Nonprofit Governance on Donations: Evidence from the Revised Form 990

Harris, Erica; Petrovits, Christine; Yetman, Michelle

doi:10.2139/ssrn.2154548

Cited by 32 publications

(67 citation statements)

References 39 publications

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“…A variable, National , was coded 1 if the charity served citizens nationwide, or 0 if local. Superior charity governance may attract donations (Harris, Petrovits, & Yetman, ). Hence, we controlled for Audit quality based on whether a charity's auditor was from China's top 100 national accounting firms in that calendar year (Kitching, ).…”

Section: Methodsmentioning

confidence: 99%

Non‐profit organizations as a nexus between government and business: Evidence from Chinese charities

Zheng

Crilly

2018

Strategic Management Journal

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Research Summary Non‐profit organizations in emerging markets frequently have to manage relations with governments and for‐profit firms. We advance a multistakeholder perspective and develop propositions about how the political ties of charities influence their success in raising funds from corporate donors. Evidence from 2,054 Chinese charities during 2005–2012 shows that organizational political ties, established through formal affiliation with the government, aid fundraising from corporate donors, whereas personal political ties, formed through personal political services of senior leaders of charities, have no such effect. The positive effect of government affiliation is relevant for both foreign and domestic donors, but stronger for domestic ones. These results highlight the differential impact and contingent value of political embeddedness for charities' ability to acquire resources from for‐profit business, contributing to both stakeholder theory and the political embeddedness perspective. Managerial Summary Non‐profit organizations have to maintain productive relations with multiple stakeholders, including government and business. We focus on Chinese charities that seek to raise funds to fulfill their mission. We identify how their political relations influence the behavior of corporate donors. Evidence from 2,054 charities from 2005 to 2012 shows that political ties formed through organizational affiliation with a political body help charities attract corporate donors that seek legitimacy. In contrast, ties formed through personal connections with politicians have less influence on donors who perceive a high risk of connected insiders engaging in activities of dubious legality. The value of political ties is more pronounced for domestic corporate donors.

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Section: Methodsmentioning

confidence: 99%

Non‐profit organizations as a nexus between government and business: Evidence from Chinese charities

Zheng

Crilly

2018

Strategic Management Journal

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“…Organizations report total contributions/grants on Form 990, and this has been the measurement typically used in previous research (e.g., Harris et al, ; Weisbrod & Dominguez, ). Total contributions/grants is the sum of income from the specific categories of (a) federated campaigns, (b) membership dues, (c) fund‐raising events, (d) related organizations, and (e) government grants, as well as from the remaining general category (f) all other contributions, gifts, grants, and similar amounts not included in the previous items.…”

Section: Data and Resultsmentioning

confidence: 99%

“…Previous research on IRS Form 990 contributions has taken various approaches to data analysis. Some have explored associations between contributions and various current or prior year factors (Harris et al, ). Others have examined associations with intraorganizational changes in contributions (Okten & Weisbrod, ; Smith, ; Steinberg, ).…”

Section: Literature Reviewmentioning

confidence: 99%

Cash is not king for fund‐raising: Gifts of noncash assets predict current and future contributions growth

James

2018

Nonprofit Mgmnt & Ldrshp

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Both fund‐raising practitioner advice and theoretical concepts from behavioral economics suggest that encouraging gifts of noncash assets may increase charitable giving. This paper analyzes data from 1,055,917 nonprofit tax returns (IRS form 990) filed electronically for the tax years 2010–2016 to explore the association between various types of noncash gifts and intraorganizational contributions growth. Compared with organizations starting at the same general contributions level in 2010 that reported only cash contributions in 2010, (a) those reporting any noncash contributions in 2010 received 41% more general contributions 5 years later, and (b) those reporting any intangible personal property contributions (mostly securities) in 2010 received 106% more general contributions 5 years later. A fixed effects regression incorporating all years of data demonstrates that decreasing the share of contributions coming from cash (i.e., increasing the share from noncash assets) was strongly associated with contemporaneous contributions growth. The largest growth accompanied increases in the share of contributions from nonpublicly‐traded securities and real estate. Relatively smaller or insignificant changes were observed when increasing the share of contributions from household goods, clothing, food, books, and collectibles. Shifting contributions from cash to noncash assets, particularly asset types representing substantial wealth, was strongly associated with contributions growth

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“…Empirical studies find a relation between negative information about a nonprofit organization and its level of donations. Harris, Petrovits, and Yetman () use factor analysis in their study of the quality of nonprofit governance, and find a positive association between good governance factors and the level of donations and grants received. Petrovits et al () find that disclosure of weak internal controls in a nonprofit organization is associated with a decline in subsequent donor support.…”

Section: Background Literature and Hypothesis Developmentmentioning

confidence: 99%

Fraud survival in nonprofit organizations: Empirical evidence

Archambeault

Webber

2018

Nonprofit Mgmnt & Ldrshp

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This study examines the survival of nonprofit organizations after the discovery of a fraud. Literature on nonprofit fraud claims that fraud has a destructive impact on nonprofit organizations. This study is the first to provide empirical evidence of the impact of fraud on a nonprofit organization's survival, and to analyze the significance of underlying organizational and fraud factors. An analysis of 115 nonprofit organizations experiencing a fraud shows that over one fourth of these organizations did not survive at least 3 years beyond the publication of the fraud, a rate considerably higher than the typical nonprofit failure rate. This article investigates the characteristics of surviving organizations and finds that older and larger organizations are more likely to survive, indicating the liabilities of newness and smallness hold in fraud survival situations. In cases where an executive‐level perpetrator committed the fraud, or where the organization victimized the public, the organization was less likely to survive. These findings suggest nonprofit organizations, particularly those that are new or small, could benefit by implementing governance policies and procedures that are consistent with those employed by more established organizations.

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The Effect of Nonprofit Governance on Donations: Evidence from the Revised Form 990

Cited by 32 publications

References 39 publications

Non‐profit organizations as a nexus between government and business: Evidence from Chinese charities

Non‐profit organizations as a nexus between government and business: Evidence from Chinese charities

Cash is not king for fund‐raising: Gifts of noncash assets predict current and future contributions growth

Fraud survival in nonprofit organizations: Empirical evidence

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