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Jan 28, 2011

Basic Duties of a Nonprofit

Every nonprofit has two basic duties, the first of which is to provide a service that fulfills a useful need in the community. Although such services vary greatly from one organization to the next, they can be categorized into a number of community needs such as relief for the underprivileged, advancement of education, lessening the burdens of government or the tensions in neighborhood, defense of human rights or combating community deterioration.

Nonprofit services have become so essential in our society that we have come to count on them always being around—homeless shelters, hospitals, health clinics, museums, food pantries, concerts, plays, neighborhood centers, preschools and so forth. Whether a nonprofit is in the arts, social services, health care or another arena, the need for what it does won’t go away even when the economy falters. In fact, it is likely the services a nonprofit provides are even more central to the vitality of the community when the chips are down. This leads to the second basic duty of a nonprofit: to sustain services through good times and bad.

The ability of a nonprofit to be there when its services are most needed is referred to as sustainability. Sustaining the mission of an organization should be the primary task of a nonprofit manager or board member and should form the basis for all important decisions. The nonprofits’ purpose and role cannot be compromised by a focus on expanding services, doing more than last year or becoming the best in the country.

If you sit on the board of a nonprofit or work for one, when you think about your mission, you should always precede every major decision with the question: How long can we sustain this change or ensure we will be able to provide this service? The dilemma of sustainability versus growth pervades the nonprofit world. A nonprofit organization has to decide early on how to deal with its ambition to grow and its obligation toward sustainability. Is it better to provide a service and then suspend it when finances are tight? Is it better to not provide the service at all if the service cannot be sustained?

There is no clear cut answer, nor is it always an either-or choice. What are your thoughts? For more information on the basic duties reference the Legal Issues chapter on page 105 of More Than Just Money: Practical and Provocative Steps to Nonprofit Success. For additional nonprofit information, visit the resources section of Proctor’s Linking Mission to Money website.