The International Journal
of Not-for-Profit Law
Volume 8, Issue 1, November 2005
Susan Raymond is Senior Managing Director for Research, Evaluation and Strategic Planning of Changing Our World, Inc., and the author of The Future of Philanthropy: Economics, Ethics, and Management:
Mr. Eisenberg’s article lays out an integrated set of challenges to the American nonprofit sector. The true problem, however, lies at a deeper level.
The nonprofit sector represents something approaching 10 percent of the American economy. Annually it receives on the order of $1.4 trillion of annual revenues and controls on the order of $2.5 trillion of assets. And that covers only the 40 percent of nonprofits that report fully to the Internal Revenue Service. Of course, removing health care and education from the equation deflates those figures considerably; $1.4 trillion becomes less than a hundred billion dollars. Still, a billion here and a billion there, and the total starts to add up.
The true problem, however, is that there are no reliable data about the sector. Without data, we are left with what Mr. Eisenberg has put forward – hypotheses and illustrations. The illustrations illuminate the hypotheses, but they do not prove them. He may be right; we suspect he is in some ways. He may be wrong; we suspect he is in other cases. The problem is that there is no way to know.
To put it another way, we cannot accurately prescribe therapy if we cannot diagnose. And we cannot diagnose without data.
What the sector needs is not a polemic. What it needs is data. If the Independent Sector and the Foundation Center truly want to make a difference, they do not need to hold meetings. What they need to do is forge multi-year partnerships with the five leading business schools in the nation and develop (a) a method for collecting data; (b) a longitudinal repository for that data; and (c) the results of original research. Such an effort is not needed at a single point in time; it is needed as a continuous flow. When the flow builds, donors, government, corporations, and the public will begin to expect the data. When expectations build, there will be no turning back, and the data platform under the nonprofit sector will be sustainable.