"Offering bowls of rice gruel to the starving and medicine to the sick" has a long and venerable tradition in Japan and elsewhere in the region. Charity will be no less important in the future. But also important will be newer forms of NPO activity: from research and analysis on key policy issues and advocacy for social change, to the delivery of social services, to facilitating international understanding and supporting overseas development.
For the nonprofit sector to play these newer roles effectively will require fundamental changes within the sector itself. Let me suggest four key areas for NPO attention.
Professionalization
First, NPOs will have to become more professional in organization and staffing so they can demonstrate their ability to achieve concrete results and thus warrant both moral and material support. They will need to do so without weakening their ties to the communities they exist to serve. Professionalization of the nonprofit sector becomes more imperative as the problems the sector seeks to address increase in number, scale and complexity. If NPOs are to receive more financial support from individuals, companies and governments, they will have to demonstrate their ability to operate both efficiently and effectively.
Transparency and Accountability
Second, NPOs will need to increase transparency and accountability. Providing regular reports on the sources and uses of funds will help increase public interest and support of NPO activities. Encouraging self-regulation through codes of conduct, standards of behavior and independent certification/accreditation/monitoring agencies will demonstrate a commitment to accountability both to donors and to the communities NPOs exist to serve.
Institutional Infrastructure
Third, NPOs will need to cooperate in strengthening the infrastructure that provides essential underpinnings for the nonprofit sector. These include networking and strategic alliances with government, business and other NPOs, both domestic and foreign, as well as formal federations and associations. Such institutions are needed to share information, experience and expertise; to give the sector a stronger voice in public policy; and to influence the policies and practices of government and business. Also needed are research and training facilities knowledgeable about the nonprofit sector and committed to the sector's development. Additional infrastructure needs may include health insurance and pension programs for NPO staff, financial intermediaries to provide working capital to NPOs, and Information Technology support agencies.
Funding
Fourth, NPOs will need to strengthen their financial base, particularly within their own societies. This will require convincing skeptical or uniformed publics to support causes and organizations that serve needy populations beyond the direct knowledge of or association with the giver. The quality as well as quantity of funding will also be important. NPOs will need to raise funds not only for direct operating cost but also for overhead or indirect costs. They will need to attract support for institutional development as well as for specific projects and programs. They will have to find general support or unrestricted income, if they are to retain control over their own agendas. They will need multi-year as well as annual commitments. And, they will need endowment support to assure the long-term survival of key private sector institutions and programs.
