Let's Put the Word ‘Nonprofit’ Out of Business (excerpt)

Claire Guadiani

Nonprofit should be nonexistent—the term, not the type of organization. The time is right to insist on a term that focuses on the investment, risk-taking, and entrepreneurial imagination that have always been so essential to organizations that serve the social good. “Social-profit organizations” is a term that can better capture the contribution made by entities that have too long been known as charities or nonprofit groups…

Getting rid of the term “nonprofit” in favor of “social profit” is not an effort to curry favor with the financial world. It is not a proposal to turn social-service organizations into heartless, PowerPoint-driven bureaucracies. It is simply an opportunity to recognize our great national tradition of philanthropy for what it is and has always been: investment in human, physical, and intellectual capital.

All investors rightly expect a return on their investment. Otherwise the very ideas of change, growth, optimism, and progress are meaningless. Social investors are no different. They are profit-seekers of the very best kind, those who believe in a better future for the arts, medical research, the environment, and countless other areas of social-profit focus.…Profit flows not in cash to employees and investors but to society, which benefits from the work of these organizations.

Excerpts from “Let's Put the Word ‘Nonprofit’ Out of Business”
from the
Chronicle of Philanthropy (July 26, 2007, p. 35).

Claire Gaudiani directs the graduate program in philanthropic studies at the
Heyman Center for Philanthropy at New York University.