Most of us hold some version of the following beliefs:
The purpose of a For-Profit Corporation is to make the most profit possible. For-Profit Corporations will do pretty much whatever they can get away with to make a profit, damaging the environment, communities and individuals’ lives unless closely supervised.
The purpose of a Non-Profit Organization is to make the world a better place.
For-Profit Corporations support Non-Profit Organizations from their profits.
The world is not nearly as good of a place as it could be. Non-Profit Organizations could make the world a much better place if only people would give them more money.
Many, if not most, corporations don’t make the world a better place as they work to build up their profits.
Many, if not most For-Profit Corporations damage the environment, local communities and human relationships to a certain extent in their quest to make and maximize their profits.
Yet, the only possible source of donations for Non-Profit Organizations is the profit produced by For-Profit Corporations. This may take the form of direct corporate donations, donations from For-Profit Corporation employees (who receive pay checks only if their work contributes to maximizing corporate profits – otherwise they would be laid off) or government money (which comes from taxing the profits of For-Profit Corporations and the pay of For-Profit Corporation’s productive workers).
Let’s say that all For-Profit Corporations make 10% Net Profit from their operations. This is an over-optimistic Net Profit percentage, but it makes the point and it makes the numbers easy to work with.
What if all For-Profit Corporations would tithe 10% of their profits to Non-Profit Organizations, who work to make the world a better place? A tithe would be 10% of their profits. Their profits are 10% of their operations. 10% of 10% is 1%. A corporation’s tithe of their profits equals 1% of their overall operations.
Therefore, 1% of the impact of a For-Profit Corporation in this example would go towards making the world a better place while the other 99% of their activities don’t contribute to making the world a better place. Instead they may damage the environment, local communities, human relations.
The dilemma is this: The Non-Profit Organizations, whose work does help make the world a better place, all have to share pieces of that 1%.
The only way for Non-Profit Organizations to increase the amount of good that they do in the world is for For-Profit Corporations somehow to give them more money.
The only way for For-Profit Corporations to give Non-Profit Organizations more tithe money is for them to increase the scope of their operations in order to generate more profit.
But, by increasing the scope of the 99% of their operation that generates the 1% that they donate, they further damage the environment, communities and human relations.
Every increase in the 1% increases the problems 99 times more.
Therefore, while this system guarantees job security for Non-Profit Organization workers, the hurrier they go the behinder they get. Ask any Non-Profit worker if they feel this way. They all do. And for good reason.
It is clear that, even under ideal circumstances, Non-Profit Organizations cannot keep up with making the world a Good Place by themselves. For-Profit Corporations must take as a primary aim to make the places where they work Good Places by the same labor that generates their profits.
People who want to make the world a better place can’t just sit around saying, “I wish more people would give me more money so I can go out in the world and do good.” They need to look for economically viable, self-sustaining work that accomplishes their goals.
We all need to resist the artificial distinction foisted upon us by the tax system. Don’t allow the tax structure to bifurcate our lives into: For-Profit, make money; Non-Profit, do good.
A solution that brilliantly (I feel) addresses this dilemma: blur the lines between For-Profit and Non-Profit. For-Profit organizations must include in their values and on their task lists work that makes the world a better place. Non-Profit organizations should work to include activities that both accomplish their missions and that generate revenue.
Indeed, all organizations – whether For-Profit or Non-Profit - should seek a balance of effort in these three areas:
1. Economic Activities –work that builds up Good Places and returns a profit, that generates resources to support the members’ living expenses and pays for the organization’s other activities,
2. Development – encouraging and supporting the members in continual growth,
3. Service – work that builds up Good Places but that doesn’t return a profit.
Aims by area:
Economic Activities
Build up Good Places and return a profit
Products and Services that delight the Customer
Support the operation and growth of the organization
Provide opportunity for individuals to support their living in the world
Support the organization’s Development and Service activities
Development
Any remedial education necessary for members to do their work
Job training so that each worker is equipped with attitude and aptitude for excellent, satisfying work
“Business” training so that each member understands what organizations need in order to grow and thrive
Job training as above for service work
Education for background as well as in-depth knowledge of the group’s economic and service activities
Other personal education and development
Service
Not all work that builds up a Good Place yields a return. Some work needs to be supported by the economic activity and to be done without a return.
Service work should be related to the group’s economic activity so that it can be supported by the entire organization (skills, resources, networks, expertise, infrastructure), not just by its tithes.
Maybe some service work could be chosen and directed by the organization’s leadership. A high value should be placed on team and individual choice as well.
I propose this as a solution to the Non-Profit Dilemma.
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