Volunteer Management: Exploring Legal Issues and Managing Risk

While many charities depend on volunteers to carry out their missions, volunteer managers may not understand the legal implications of working with volunteers and unpaid staff. The Lawyers Alliance of New York has just published “The Volunteer Workforce: Legal Issues and Best Practices for Nonprofit Organizations” to help nonprofit explore some of these topics. The first section covers the legal difference between volunteers and employees, best practices for screening and compensating volunteers, and how to manage volunteers. The second section deals with legal pitfalls and the consequences of mishandling the volunteer relationship. The guide’s appendix also contains sample forms. Although the book focuses on New York state law, non-New York employers may find it useful since much of the pertinent law is federal.

If you are interested in further managing risk when working with volunteers, consider browsing the Nonprofit Risk Management Center’s latest edition of “No Surprises: Harmonizing Risk and Reward in Volunteer Management.” Topics covered include young and senior volunteers, animals, corporate volunteers, public relations issues, insurance, and volunteer protection laws.

While these guides are not intended to be a substitute for legal advice, they are good publications to help you get conversations started on the legal issues related to working with volunteers.

To find additional readings from the Catalog of Nonprofit Literature on the topic of voluntarism, click HERE.

Nonprofit Governance Study Released

As the nonprofit sector continues to promote greater accountability and transparency, more research is needed to develop best practices and support policy debates. The Urban Institute’s Center on Nonprofits and Philanthropy has released "Nonprofit Governance in the United States: Findings on Performance and Accountability From the First National Representative Study."

The report analyzes data collected in 2005, which covers more than 5,100 nonprofit organizations. It addresses three areas of nonprofit governance: how accountability policies such as Sarbanes-Oxley affect nonprofits; factors that promote or impede boards' stewardship of organizations; and the board composition and recruitment process. Here is just one of the study's many findings:

"Substantial percentages of boards are simply not actively engaged in various basic governance activities—and if anything, this study, based on self-reports, likely understates the problem. Furthermore, we find a level of insularity among nonprofit boards in certain respects that is not consistent with their public-interest serving mandate. This is true in the areas of composition, where we saw high levels of ethnic and racial homogeneity."

See also consulting group Grant Thorton’s "2006 National Board Governance Survey for Not-for-Profit Organizations.”

To find additional readings from the Catalog of Nonprofit Literature, click on the subject headings below:

Nonprofit organizations-accountability
Board members

New Case Study of a Failed Social Enterprise

Seedco Policy Center's new report The Limits of Social Enterprise: A Field Study & Case Analysis presents an overview on nonprofit social enterprises and includes a case study of a failed venture (Seedco's Community Childcare Assistance program). It provides lessons learned as well as recommendations for nonprofit entrepreneurship. Here are two lessons from the study:

"When businesses are expected to meet for-profit goals while operating under nonprofit rules, the so-called double bottom line can easily become an impossible double bind."

"Nonprofit social-purpose businesses must resist the impulse to 'do more.' The more social responsibilities a venture assumes, the more difficult it is to succeed in the marketplace."

For more information on social entrepreneurship, I've created a canned search of the Catalog of Nonprofit Literature for you (click here).

Supporting Indigenous Populations

Some of our readers may be interested in philanthropy related to indigenous populations. Let's review a few of these items that I have come across, all of which are available online:

Delgado, Louis T. A Demographic Profile of Independently Incorporated Native American Foundations and Selected Funds in the United States. Minneapolis, MN: Native Americans in Philanthropy, 2006. 24 p.
Provides basic demographic information on 60 Native American-controlled philanthropic organizations: 36 Native American foundations, 15 nonprofit organizations, and nine tribal funds.

Adamson, Rebecca. "Indigenous Peoples and Philanthropy: Colonialism by Other Means?" Alliance, vol. 11 (December 2006): p. 40-1.
A degree of distrust between some foundations and indigenous organizations has emerged over time due to cultural misunderstandings. The author suggests that grantmaking can be more effective when funders employ a holistic approach to philanthropy that provides enough flexibility for indigenous peoples.

Gordon, Ken. "The Fine Line of Funding in Indian Country." Grantmakers in the Arts Reader, vol. 18 (Spring 2007): p. 13-5.
Gordon explains how important it is to respect the indigenous cultures of grant applicants when gathering information from them. He draws from his grantmaking experience as former chief executive of Trust Waikato, a community foundation in New Zealand. Gordon is currently the executive director of the Potlatch Fund, based in Seattle.

Foundations and Public Policy

Foundation Yearbook: Facts and Figures on Private and Community Foundations released just last month by the Foundation Center, estimated that overall foundation giving rose 11.7 percent in 2006 to an estimated $40.7 billion. While this is an impressive figure, we should note that the government annually spends hundreds of billions of dollars in areas nonprofits are interested in.

Indeed, one way foundations can achieve their missions and address long-term issues is by shaping public policy. Foundation leaders may not know enough about advocacy strategies or understand the legal rules and risks associated with such efforts.

Earlier this year, the Fieldstone Alliance, in collaboration with Grantmakers for Effective Organizations, published “Power in Policy: A Funder’s Guide to Advocacy And Civic Participation.” The various contributors to the book weigh what role foundations should play, and provide real-life examples, practical advice, and inspiration. Be sure to stop by our library/learning centers to have a look!

New Report on Giving Circles

Giving circles are groups of people who combine their donations to fund projects in their communities. The Forum of Regional Association of Grantmakers has been carefully tracking the emerging trend and has released "More Giving Together: The Growth and Impact of Giving Circles and Shared Giving." The Forum has identified more than 400 giving circles and has gathered in-depth information on 160 of them.

This second report from the Forum updates basic giving circle data from the original 2004 study, describes how giving circles sustain themselves, and encourages the formation of more giving circles. The full-text of the study is available at the Forum's web site. For more information on starting or joining a giving circle, be sure to visit the Forum's Giving Circle Knowledge Center.

Practical Advice for Launching a Publication

If you are planning to launch a magazine, newsletter, or web site for your nonprofit organization, Nolo Press has just released a comprehensive handbook that can help you get started. "Every Nonprofit's Guide to Publishing" explains in detail how nonprofits of all sizes can apply standard publishing strategies, techniques, and best practices to their products. Topics covered include the editorial mission, production process, content development, budgeting, personnel, design, printing, web publications, distribution, advertising, and getting feedback. The book also comes with a CD-ROM that contains sample forms, checklists, and worksheets:

Woodward, Cheryl and Lucia Hwang. "Every Nonprofit's Guide to Publishing: Creating Newsletters, Magazines & Websites People Will Read. 1st ed. Berkeley, CA: Nolo Press, 2007. 440 p. ISBN 1-4133-0658-6

Corporate Mergers and Philanthropy

The National Committee for Responsive Philanthropy and the Rockefeller Foundation have released the report "Banking on Philanthropy: Impact of Bank Mergers on Charitable Giving." Contrary to the belief that mergers would have a negative impact on corporate giving, an examination of several bank foundations' 990-PF tax filings from 1983 to 2005 reveals a significant increase in total giving. The report suggests that the growth can be attributed to a greater emphasis on strategic philanthropy by corporations, as well as the work of community advocates calling for regulators and banks to support community needs.

The data also revealed that a majority of bank foundations' tax filings were in violation of certain IRS rules. The report concludes with recommendations for increasing corporate giving as well as suggestions to achieve greater transparency in corporate philanthropy. The banks that were analyzed include Bank of America, JP Morgan Chase, Citicorp, SunTrust, Wachovia, Washington Mutual, and Wells Fargo.

The full text of the report is available at the National Committee for Responsible Philanthropy's web site.

How Funders Can Support Capacity Building

In addition to providing program grants to nonprofits, funders can help organizations achieve their missions more effectively by investing in capacity building projects. The management consulting firm, TCC Group recently released "Deeper Capacity Building for Greater Impact: Designing a Long-Term Initiative to Strengthen a Set of Nonprofit Organizations," a briefing paper supported by a grant from the James Irvine Foundation.

The document covers key decisions that grantmakers must make when developing capacity-building initiatives, including the duration of the initiative, the funder's role, the types of assistance to provide, and others. If you are interested in learning how grantmakers can plan, implement, and evaluate long-term capacity building programs, you can view the full text of the briefing paper at the TCC Group's web site.

Nonprofits Generous With Marketing Benefits

A recent study from sponsorship consulting and research group IEG found that nonprofits often include free marketing benefits in their pitches to corporate donors. These benefits range from special recognition on brochures that other donors do not receive, to rights to carry out cause-marking campaigns. Considering how valuable these marketing opportunities can be for the companies, IEG suggests that nonprofits should be charging extra fees for these perks.

Review the results of the Strategic Philanthropy Study in the latest issue of IEG Sponsorship Report, available at our New York library/learning Center:

"IEG Survey: Most Nonprofits Give Away Valuable Marketing Benefits." IEG Sponsorship Report, vol. 26 (25 June 2007): p. 1, 4-5.

Should More Nonprofits Merge?

Published by the Center for Social Innovation at the Stanford Graduate School of Business, Stanford Social Innovation Review (SSIR) is a key periodical that covers topics such as nonprofit management, social entrepreneurship, corporate social responsibility, and philanthropy.

In the Summer 2007 issue of SSIR, there are three interesting articles on nonprofit mergers:

Go Ahead--Pop the Question: Why More Nonprofits Should Merge"
Kevin T. Kilpatrick, executive vice president of the consulting company Metropolitan Group, explains that there are too many nonprofits competing for scarce resources, a situation that can lead to mission drift as organizations chase funding opportunities.

Before You Say "I do": Why Nonprofits Should Be Wary of Merging
Denise L. Gammal, managing director of the Stanford Project on the Evolution of Nonprofits, explains that nonprofits need to be careful when considering mergers because they often underestimate the time, cost, and effort involved in consolidations.

Uniting for Survival
The case study examines the ways that four Chicago-area cancer support centers collaborated before forming a fifth nonprofit to leverage their resources.

Also in the Summer 2007 issue, Aneel Karnani, associate professor of strategy at the University of Michigan’s Ross School of Business, presents an alternate perspective on microfiance. In Microfinance Misses Its Mark, Karnani suggests that in order to address long-term poverty issues, societies should invest in supporting labor-intensive industries rather than microfinance programs. The full-text of this article is available at the SSIR web site.

Stanford Social Innovation Review is just one of more than 60 periodicals that the Foundation Center library/learning centers subscribes to. Click here to find out about other periodicals in our collection.

2007 Terry McAdam Book Award Winner

In "Momentum: Igniting Social Change in the Connected Age" Allison Fine describes how newer technologies are being used to foster social networks and support activism. The title received this year's Terry McAdam Book Award, which recognizes outstanding books in nonprofit management. The award is sponsored by the Alliance for Nonprofit Mangement and the Chronicle of Philanthropy, and is supported by a grant from the New York Community Trust and the Conrad Hilton Foundation.

Visit the Alliance for Nonprofit Management's Web site to learn about books that received honorable mention or were considered worthy of note.

Michael Seltzer's "Securing Your Organization's Future" was the first Terry McAdam Book Award recipient. Click here to see a list of past award winners.