Boundaries Between Nonprofits and Business Are Increasingly Blurred, Scholars Say
Urban Institute

February, 2009

Nonprofits and businesses interact in more and newer ways every year as powerful economic and social forces change. Nonprofits adopt more business-like practices, corporations support nonprofits through cause-related marketing, and social entrepreneurs create private businesses to achieve social goals. Nonprofits and Business, a new Urban Institute Press book, explores these and many other ways the two sectors collaborate, compete, and clash.

“Boundaries between nonprofit and for-profit activities continue to shift in ways that are redefining what it means to be a ‘nonprofit’ organization, and that also are forcing new attention to existing laws relating to public policy, taxation, and business regulation,” write editors Joseph J. Cordes and C. Eugene Steuerle.

More and more of society’s output and jobs -- health and information being prime examples -- could easily involve either sector. The resulting cross-pollination ranges along a continuum, with “traditional” nonprofit organizations relying on grants and donations at one end, for-profit enterprises with related charitable activities at the other, and institutional arrangements that mix and match for-profit and nonprofit elements in between.

Eleven distinguished scholars guide readers through this complex landscape:

• Dennis R. Young clarifies the concept and practice of social entrepreneurship.
• Joseph J. Cordes and C. Eugene Steuerle analyze the benefits of various nonprofit/for-profit hybrids.
• Evelyn Brody explores the legal problems that nonprofits’ business activities pose and the dense financial ties between the two sectors.
• Howard P. Tuckman describes structures that cross for-profit entities and nonprofit organizations to advance a nonprofit’s mission.
• Alan R. Andreasen describes marketing alliances between nonprofits and businesses and points out the benefits and perils of these collaborations.
• Burton Sonenstein and Christa Velasquez recant the Annie E. Casey Foundation’s adoption of innovative program-related investments, which produce both financial and social returns.
• Eric C. Twombly analyzes the impacts of increased competition with for-profits on the nonprofit labor market.
• Linda M. Lampkin and Harry Hatry discuss why nonprofits are increasingly called upon to develop and use systematic performance measures.

“Anyone interested in the complex interactions between nonprofits and business will find this book an excellent and comprehensive resource. The authors bring timely analysis and insight to bear on the problems -- and opportunities -- these intertwined sectors face today. Nonprofits and Business is an informative, engaging read for students and researchers alike,” says Professor Alan J. Abramson of George Mason University’s Department of Public and International Affairs.

Nonprofits and Business , edited by Joseph J. Cordes and C. Eugene Steuerle, is available from the Urban Institute Press (paper, 6" x 9", 284 pages, ISBN 978-0-87766-741-4, $29.50). Order online at http://www.uipress.org , call 410-516-6956, or dial 1-800-537-5487 toll-free.

The Urban Institute is a nonprofit, nonpartisan policy research and educational organization that examines the social, economic, and governance challenges facing the nation.