"--Peter Brooks, Princeton University "This is an important book and a superb piece of writing, combining passionate enthusiasm with calm arguments and informative examples.

Wright, Ken Review of: Not for profit: Why democracy needs the humanities, by Martha C. Nussbaum, Princeton University Press, 2012, xv + 168 pp. $27.95.

Lucas, Brian Review of: Not-for-profit law: Theoretical and comparative perspectives, by ed. Matthew Harding, Ann O'Connell and Miranda Stewart, pp. 396, ebook $125.40, hardback $175.00.

The law and policy applicable to the not-for-profit sector is of growing importance around the world. In this book, legal experts address fundamental questions about not-for-profit law from a range of theoretical and comparative perspectives. The essays provide scholarly analysis of not-for-profit law, organised around four themes: Politics, in the broader sense of living as a community, and the narrower sense of political power; Charity, how it is defined and changes in its meaning over time; Taxation, including (...) the rationale for government support of the sector through the tax system; Regulation, which is of increasing significance as governments establish increasingly complex forms of regulation of not-for-profit activity. The fundamental aim of the book is to deepen our understanding of not-for-profit law and of the rationales and modes of government support for the not-for-profit sector. (shrink)

Reforms in the German health care system in the attempt to bring more competition into health care have increased the sovereignty of the insured or patients, who have finally been allowed to make choices. “The start of a reorientation of the statutory health insurance system and hospital care are to be welcomed as first steps towards a supply of health services that reflects individual preferences.” The authors can be contacted care of Prof. Dr. Oberender at Rechts‐ und Wirtschafswissenschaftliche Fakulät, Universität (...) Bayreuth, 95440 Bayreuth, Germany, where Dr Oberender is Professor in the Faculty of Law and Economics, and Ansgar Hebborn is his Assistant. The authors wish to record their gratitude to Jan Hacker for translating this article. (shrink)

Reforms in the German health care system in the attempt to bring more competition into health care have increased the sovereignty of the insured or patients, who have finally been allowed to make choices. “The start of a reorientation of the statutory health insurance system and hospital care are to be welcomed as first steps towards a supply of health services that reflects individual preferences.” The authors can be contacted care of Prof. Dr. Oberender at Rechts‐ und Wirtschafswissenschaftliche Fakulät, Universität (...) Bayreuth, 95440 Bayreuth, Germany, where Dr Oberender is Professor in the Faculty of Law and Economics, and Ansgar Hebborn is his Assistant. The authors wish to record their gratitude to Jan Hacker for translating this article. (shrink)

Princeton, NJ: Princeton University Press, 2010. Pp. 178.Hb. £15.95.

Performance measurement has far-reaching implications for not-for-profit organizations because it serves to legitimize, attract resources, and preserve expectations of stakeholders. However, the existing theory and practice of not-for-profit performance measurement have fallen short, due in part, to an overuse of profit-oriented philosophies. Therefore, we examine not-for-profit performance measurement by utilizing Marques’ “five spiritual practices of Buddhism.” Marques’ spiritual practices—a pro-scientific philosophy, greater personal responsibility, healthy detachment, collaboration, and embracing a wholesome view—are the foundation of our research (...) design. Responses from senior not-for-profit practitioners support the linkages between spiritual practices and not-for-profit performance measurement. We identify three essential performance measurement principles and elaborate on their capacity to generate awareness, higher meaning, and connectedness within not-for-profits. (shrink)

Assume that a not-for-profit receives a sizable donation and names a building after the donor. What should the not-for-profit do, when, at a later date, the donorbecomes tainted because of a scandal? This paper outlines a typology of donors and donations, and using stakeholder theory and resource dependency identifies three external factors (cognitive dissonance, multiple stakeholders, and recency) and three organizational factors (economic need, funding guidelines, and commitment) that would entice a NFP to adopt any one of three (...) strategies: return the money and delete the donor’s name; keep the money but delete the donor’s name; or keep the money and the donor’s name on the building. (shrink)

Nussbaum's analysis of our predicament turns on a contrast between two rival models of education. The "old model," concerned with education for profit and economic growth, places heavy emphasis on the skills associated with science and technology. From this perspective, the study of literature, history, philosophy, languages and the arts make no real or significant contribution to our basic economic needs and concerns - they may even be obstacles. In contrast, Nussbaum defends "the human development mode," which regards the (...) humanities as having a crucial role in our commitment to a democratic community and social equality. This alternative approach is perhaps better described as the "ethical model," since in respect of both its method and content it aims to produce humane, sympathetic and creative "global citizens." -/- ... This book will certainly add weight to Nussbaum's considerable reputation and influence as a major public intellectual. Her core diagnosis is both accurate and compelling. There are, nevertheless, features of this book that may be questioned.... Some may argue, for example, that Nussbaum's defence of the humanities leans too heavily on the political value we attach to these studies and, more particularly, on the specific ideological goals that they are supposed to secure. The general objection here is that it is a mistake simply to assume that the humanities' primary role is to serve as a vehicle for those progressive social forces concerned with issues of race, gender and sexuality. Although the contemporary humanities program has veered heavily in this particular direction, it is a matter of intense debate, within the humanities, to what extent this has been healthy and constructive. Clearly there are more traditional or conservative forces who take the view that this way of politicizing the humanities, of imposing a particular ideological agenda on its content and concerns, has not only narrowed and impoverished our understanding of humanities education, it has left the humanities vulnerable to hostile and reactionary forces only too willing to scrap them altogether.... -/- . (shrink)

The theorisation of fraud has largely been developed in the for-profit sector, and the paper extends this to the not-for-profit sector. Motivated by social control theory, we adopt a qualitative approach to assess the views of key charity stakeholders (social control agents) of charities registered with the Charity Commission for England and Wales about fraud. We find that stakeholders, especially donors and beneficiaries, are often reluctant to label ‘fraud’ as a threat to the sector. This reflects ‘trusting indifference’, (...) a value embedded in the sector that brings more harm than good to the sector in terms of wrongdoing, by hampering effective social control. Adapting existing theories of fraud to charities, we propose a ‘fraud tower’ with three layers: the social layer (trusting indifference), organisational layer (opportunity), and individual layer (fraudsters-opportunity seekers). (shrink)

Princeton, NJ: Princeton University Press, 2010. Pp. 178.Hb. £15.95.

The tension between organizational values and the operation of aged care as a business is often characterized as the “mission versus margin” dilemma. It is common across the industry in both not-for-profit and for-profit organizations. However, in for-profit aged care facilities, there is no question about the intention to make a profit or the purpose of the profits. This is not so clear in not-for-profit aged care organizations. This article explores the tension through the examination (...) of a detailed case study of one of the larger not-for-profit social service organizations—All Saints Christian Care. It analyses the culture and managerial decisions though the lens of the political philosophy value pluralism. Finally, based on the value-plural theory, recommendations are made that would create greater operational transparency in not-for-profit aged care service. (shrink)

We attempt to identify and evaluate the association between key characteristics of not-for-profit hospitals and market concentration, as measured by the Herfindahl–Hirschman Index, using data available from the American Hospital Association, the Centers for Medicare and Medicaid Services, and the Internal Revenue Service Form 990. Our goal is to provide decision support to policy makers on factors that contribute to market competitiveness, which has been linked to improvements in efficiency, costs, and access to health care. We find that contributions (...) are positively associated with market concentration. This could indicate that well-run NP hospitals are rewarded both financially as well as with increased market share. We also find that a higher percentage of Medicare patients is positively correlated with market concentration. This could be explained by the fact that Medicare reimbursement rates are generally lower than those paid by private insurers ; thus, hospitals might not necessarily choose to operate in areas with high Medicare populations. Further, median income is negatively associated with market concentration. One explanation for this effect could be the fact that a population with a higher median income is in a better position to pay for services, making them attractive to hospitals as a potential market. Finally, we find that the presence of managers with voting rights on the boards of directors has no significant impact. (shrink)

Corporate social responsibility (CSR) is increasingly important in the global environment. Businesses that want to be socially responsible, but do not have the resources of multinational corporations, can partner with non-governmental (NGO), not-for-profit (NFP), and religious organizations to access information about the culture, customs, and needs of the people in areas where they wish to do business. Without such information, CSR projects can have unintended consequences that are not beneficial for the community. Suggesting that local farmers sell corn to (...) ethanol producers may increase the farmers' income but also increase the cost of a food staple to the community. Providing food aid may result in local farmers being unable to sell their crops for enough money to buy seed for the next harvest. Donating cheaper cinder blocks instead of adobe bricks may result in more available housing, but the housing may be unlivable in the summer heat. This paper presents a three-part model for businesses to follow to develop socially responsible projects. The first strategy is to use electronic sources of information about a country and area for background information. The second strategy is to gather on-the-ground information about important issues from the people who are already operating in a community as part of NGO, NFP and missionary initiatives. The third strategy is to develop scenarios that will help identify possible negative consequences of socially responsible projects so that the project implementation can be monitored for such consequences and interventions designed to decrease or counter the impact of negative consequences. (shrink)

This paper is an attempt to address the limited amount of research in the realm of organizational ethical climate in the not-for-profit sector. The paper draws from Victor and Cullen's (1988) theoretical framework which, combines the constructs of cognitive moral development, ethical theory, and locus of analysis. However, as a point of departure from Victor and Cullen's work, the authors propose an alternative methodology to extract ethical climate dimensions based on theoretical considerations. Using the Ethical Climate Questionnaire (ECQ), an (...) exploratory factor analysis is conducted followed by a confirmatory factor analysis using LISREL. The resulting five dimensions are labelled as: individual caring, machiavellianism, independence, social caring, and law and code. Findings provide a somewhat disparate perspective of the ethical climates in a not-for-profit context. First, there is a more discriminating perception of benevolent climate than its for-profit counterpart. Second, the dimensions are polarized between the individual and the cosmopolitan loci of analysis. These findings are then discussed with implications and direction for future research. (shrink)

In the last decade, Australian federal and state governments’ commitment to the economic rationalist imperatives of performance measures, accountability for outcomes, and value-for-money has driven significant change in the Australian not-for-profit community services sector. In an environment shaped by neoliberal-inspired government policies and a renewed government commitment to austerity, Australian not-for-profit community service organizations are now, more than ever, actively engaged in a variety of income-generating strategies to achieve and/or maintain economic sustainability. Central to this process is meeting (...) the dual challenge of succeeding financially in a competitive environment and simultaneously serving mission. In this context, it is time to more closely examine the impact of these challenges, in particular the implications for the organizational values of not-for-profit community service providers themselves. This paper reports on a qualitative study of fourteen not-for-profit community service organizations, their core purposes, and their strategies for economic sustainability. In addition to the new data presented here, this paper contributes to the broader theoretical framework—the lens of value pluralism, which, we argue, provides a sharper focus on the relationship between mission and margin. (shrink)

This teaching case focuses on Diversity, Equity, and Inclusion (DEI) at a museum. At the beginning of 2021, the organization found itself in a crisis when more than 2,000 community members and 85 anonymous employees demanded the resignation of the museum’s President due to the language he defended in a job posting advocating for a job applicant to diversify audiences while “maintaining the traditional white core audience of the museum” (Salaz 2021). Students take on the role of an external consultant (...) to assess DEI maturity at the museum. The case challenges students to propose implementation and impact metrics for a DEI action plan. The case facts provide a timely and relevant setting to discuss DEI challenges in not-for-profit organizations. (shrink)

AbstractDeveloped from meaningful work and business ethics, we investigate the motivational effect of meaningful work on paid staff (not volunteers) with a “shortage” of ethical employment practices situated in the Not-for-Profit sector. We tested the traditional notion of meaningful work by nature and by line manager support (under its business-like practices) to compensate for the “sacrifice” (low pay and job stress caused by poor employment terms) of front line staff working alongside professional managers paid the market rate. Using a (...) mixed-method case study, we employed SEM modelling to analyse a staff survey of 125 valid responses and administrative records of staff resignation, alongside interviews. The results show that meaningful work by nature and by line manager support are positively and significantly associated with job satisfaction but neither has a significant effect on staff resignation action. There is no empirical evidence to support the compensating effect of meaningful work by nature; meaningful work by line manager support has a stronger effect only through reduced job stress, rather than compensating for the low pay, in preventing resignation. The qualitative analysis reveals that continued low pay and using precarious employment contracts have evoked the questioning of ethics of employment practices in this sector. We discuss the implications and suggest further areas of research. (shrink)

(2013). Enrollment of Education Majors at Public, Not-For-Profit, and For-Profit Postsecondary Institutions: An Empirical Analysis. Educational Studies: Vol. 49, No. 6, pp. 522-539.

Knowing the factors that executives deem critical to governance change can improve our understanding of how such changes come about and can help us evaluate those changes. Interviews with business and finance executives at 11 colleges reveal the importance to governance change of chief executive and board member leadership and interactions, as well as executive communication style. Costs are clear constraints to action, particularly since benefits are not quantified and are difficult to describe. Efforts to discuss governance with internal stakeholders (...) require persistence to overcome narrow, individualized concerns. Communication about governance to external stakeholders is rare and represents a missed opportunity for stakeholder feedback and the development of trust. Executives appear willing to adopt governance forms without considering the idiosyncrasies of their institutional field, limiting the working definition of governance and its potential. For corporations and not‐for‐profit enterprises these findings hold implications for the context in which leadership is exercised and the shape of governance structures. They also pose a fundamental ethical dilemma for leaders to address. (shrink)

Utilizing Rest's moral development and Victor and Cullen's ethical climate surveys, we examine differences in moral reasoning and ethical climate between board members in the for-profit and not-for-profit sectors. Six for-profit corporations and seven not-for-profit corporations, all with base operations in a major midwestern state, participated in the study. We find that profit and not-for-profit boards may not differ in moral reasoning, but do exhibit different types of ethical climates. We also find that for- (...) class='Hi'>profit board members may utilize higher stages of reasoning a greater percentage of the time than not-for-profit directors. In contrast, the ethical climates of the two types of organizations are significantly different. For-profit companies had climates higher in egoism than did not-for-profit companies. In addition, not-for-profit firms reflected higher benevolence factors than for-profit firms. Not-forprofit organizations also had somewhat higher, but not significantly different, mean scores on the principle factor compared to the for-profit organizations. (shrink)

This chapter looks at the impact of recent societal approaches of knowledge and science from the perspectives of two rather distant educational domains, mathematics and music. Science’s attempt at ‘self-understanding’ has led to a set of control mechanisms, either generating ‘closure’—the scientists’ non-involvement in society—or ‘economisation’, producing patents and other lucrative benefits. While scientometrics became the tool and the rule for measuring the economic impact of science, counter movements, like the slow science movement, citizen science, empowering music-art initiatives and other (...) critical approaches focus on intrinsic and ethical questions of education and knowledge. Thinking about knowledge and research in terms of quantifiable products impacts heavily upon the domains of science and arts, while the complexity of knowledge acquisition forces society to consider also other parameters like equality, personal development and participatory processes. (shrink)

Martha C. Nussbaum, Not For Profit: Why Democracy Needs the Humanities, 2012, Princeton and Oxford, MA: Princeton University Press, pp. 184, $15, ISBN: 978-0-691-15448-0.

This article develops contractarian business ethics by applying social contract arguments to a specific question: What are the pre-legal (or moral) rights and responsibilities of corporations? The argument uses a hypothetical social contract to show the existence of for-profit corporations in democratic capitalist societies is consistent with Rawls’s fundamental principles of justice. Corporations ought to have recognised their rights to be autonomous, to pursue private purposes, and to engage in economic activities. Corporations have a responsibility to respect the freedom (...) and human rights of all people, and not to interfere with government programs that ensure people have the education and training they need to find and keep corporate employment and that provide a safety-net that prevents destitution. If corporations have any other rights and responsibilities, those rights and responsibilities need to be established by actual social contracts, probably in the form of legitimate democratic processes. (shrink)

According to an influential argument in business ethics and economics, firms are normatively required to maximize their contributions to social welfare, and the way to do this is to maximize their profits. Against Michael Jensen's version of the argument, I argue that even if firms are required to maximize their social welfare contributions, they are not necessarily required to maximize their profits. I also consider and reply to Waheed Hussain's ‘personal sphere’ critique of Jensen. My distinct challenge to Jensen seems (...) to me fatal to any view according to which firms are normatively required to maximize their profits. (shrink)

Eco-communities are a potential model for the socio-technological transition to a post-carbon society. The debate over their economic sustainability has, however, been limited. This article aims to enhance the discussion by offering a conceptualization of the economic micro-system created in eco-communities. It uses the economic terms households and firms to discuss two ways in which the community economy is positioned and then goes on to explore the principles behind the non-market activities of households and the not-only-for-profit activities of firms (...) as the basis of the eco-community economy. It concludes by pointing out that both can operate in parallel, with eco-communities producing non-market capital that can be used to develop not-only-for-profit activities which support the economic sustainability of the projects. (shrink)

:According to an influential argument in business ethics and economics, firms are normatively required to maximize their contributions to social welfare, and the way to do this is to maximize their profits. Against Michael Jensen's version of the argument, I argue that even if firms are required to maximize their social welfare contributions, they are not necessarily required to maximize their profits. I also consider and reply to Waheed Hussain's ‘personal sphere’ critique of Jensen. My distinct challenge to Jensen seems (...) to me fatal to any view according to which firms are normatively required to maximize their profits. (shrink)

Drug enforcement is unattractive, to put it mildly, particularly in the United States. Few try to defend current U.S. policies, let alone those from before recent reforms.The Bureau of Justice Stat...

Why do some organizations suffer more than others in the wake of an industry scandal? Although ex-ante greater opportunistic behavior of organizations is one factor, we argue that ex-post greater targeting of organizations is another important factor. Using the context of microfinance organizations (MFOs), we examine why the financial sustainability of for-profit and non-profit organizations may be heterogeneously affected following a scandal. Leveraging the 2010 Indian microfinance scandal as our research setting and analyzing longitudinal data, we find a (...) substantial decline in the financial sustainability of Indian MFOs relative to their counterparts within the rest of South Asia. Compared to Indian non-profit MFOs, Indian for-profit MFOs suffered substantially more. Intriguingly, these results hold not only in the full sample, but also in the matched sample of comparable for-profit and non-profit MFOs. Further analysis reveals that the adverse impact on for-profit MFOs was much bigger in the scandal’s epicenter. Our findings suggest that some organizations may suffer more than others not only due to their engagement in actual malfeasance but also due to their greater targeting by the social control agents. We discuss the implications of this study for social enterprise managers and policymakers. (shrink)

This book focuses on justice and its demands in the way of providing people with medical care. Building on recent insights on the nature of moral perceptions and motivations from the neurosciences, it makes a case for the traditional medical ethic and examines its financial feasibility. The book starts out by giving an account of the concept of justice and tracing it back to the practices and tenets of Hippocrates and his followers, while taking into account findings from the neurosciences. (...) Next, it considers whether the claim that it is just to limit medical care for everyone to some basic minimum is justifiable. The book then addresses finances and expenditures of the US health care system and shows that the growth of expenditures and the percentage of the gross national product spent on health care make for an unsustainable trajectory. In light of the question what should be changed, the book suggests that overdiagnosis and medicalizing normal behavior lead to harmful, costly and unnecessary interventions and are the result of unethical behavior on the part of the pharmaceutical industry and extensive ethical failures of the FDA. The book ends with suggestions about what can be done to put the U.S. health care system on the path to sustainability, better medical care, and compliance with the demands of justice. (shrink)