The following is a conversation between Dan Cardinali, President and CEO of Independent Sector, and Denver Frederick, Host of The Business of Giving on AM 970 The Answer in New York City.
Denver: It is always so interesting to hear from the leaders of nonprofit organizations about the work they do around a particular issue and the lives that are being transformed as a result. But it is also essential to take a step back now and again to understand the dynamics of the sector in which this work is going on and the issues that impact all of these organizations. We cannot find a better person to do that with than my next guest. He is Dan Cardinali, the President and CEO of the Independent Sector. Good evening, Dan, and welcome to The Business of Giving.
Dan Cardinali: Denver, it’s a pleasure to be with you.
Denver: Give our listeners some of the history of the Independent Sector and of the organization’s mission and goals.
Dan: Independent Sector was founded 37 years ago by a social entrepreneur, John Gardner, who was really a public intellectual. He had been in the for-profit, nonprofit, academia, a chronic social entrepreneur who founded many organizations. He realized that there was this very important role for the founding of the Independent Sector to be an organization that brought philanthropy and nonprofits together into a vital meeting ground where it was non-transactional. It was about understanding where the world was and how civil society can come together and solve problems, build culture, preserve the natural environment, and then to translate that activity into good public policy… So the sector could be a real force for good, but partnering with government and with business in transforming the world.
Denver: Most people, I don’t think, fully appreciate the scope and breadth of this sector in the United States. Why don’t you describe it to us?
Dan: Sure. The name goes — you hear social sector, you hear charitable sector, you hear nonprofit, they’re all basically the same. There are about 1.6 million nonprofit and philanthropic organizations in the United States. They range from the zoos to museums, to the food banks, to churches, to synagogues, to all sorts of wonderful think tanks that produce incredibly important ideas. These 1.6 million organizations make up the nonprofit sector.
I don’t think most folks know that 1 in 10 Americans are actually employed by the social sector. If you think about the 63 million volunteers every year this country has, 1 in 4 Americans is actively involved in this sector. So we generate about $ ½ trillion dollars of economic activity, and if you look at that volunteer time alone, it’s worth almost $200 billion of value. So it is in a robust, dynamic part of American life and American economy.
Nonprofits, small as they may be, provide a really important opportunity for citizens to continually engage with each other, solve problems, and improve the community.
Denver: You just mentioned there are about 1.6 million nonprofits, and I think we have about 320 million people in the country right now – so doing some quick math, that’s about one nonprofit for every 200 people. Do you think the sector would benefit, be more efficient and effective, with a little bit of consolidation?
Dan: I think that is kind of a nonprofit-by-nonprofit reflective question. One thing that you can see is, efficiency does matter when you’re using and stewarding resources on behalf of community. So in so far as you can create efficiencies, and if consolidation enables you to do that, that’s terrific. An organization I used to work with– Communities in Schools– we saw some consolidation over the years when you had a number of very small rural affiliates unable to get the kind of critical mass that an economy of scale by consolidation promoted. And they were able to hire even better staff, build the kinds of technology systems that enabled them to be much more analytical, and then therefore, better services to kids.
However, there’s something in America that’s incredibly important. This notion of association– Individual citizens making decisions about coming together and solving problems or promoting culture or preserving the environment.
Nonprofits, small as they may be, provide a really important opportunity for citizens to continually engage with each other, solve problems, and improve the community. So you want to be careful with a blanket statement, like, “We need to consolidate!” as much as: “What are we trying to get accomplished? And how do we get an organizational structure strong enough to help us really achieve that vision?”
Denver: So taking the entirety of this vast and multi-faceted and fascinating sector, what is the unique role that the Independent Sector plays and the distinct contribution that you make, Dan?