Non profit is a business structure not a designation meaning “no business acumen.” Many non profits are actually quite profitable and active businesses, but they have no beneficial owners, pay no dividends, etc, and often have some mission that’s in some way broadly beneficial. This exempts them from certain taxation and other benefits. But it absolutely doesn’t mean everything they do is done altruistically without material consideration and definitely doesn’t mean with no legal claims or recourse for protecting their works or identities.
Most people with the organizational skills to operate a complex enterprise demands a pretty significant compensation package. Even if you found someone to do it for considerably less once they’ve proven effective they would become highly sought after in the labor market and would be poached away leading to churn and turnover in roles that really benefit from stability over time. While it is likely there is someone who doesn’t mind living a life of austerity when capable securing of a much more comfortable lifestyle for them and their family, it can be really hard to find them and require a lot of churn in mishiring the talent and losing skilled talent due to inflicting non market bearing penury on them and their loved ones out of some weird morality not supported by the surrounding culture and society.
To their execs. It’s basically a meme in non-profit world how poorly everyone outside the C-suite gets paid and how the non-profit “mission” is weaponized against workers in salary negotiations.
I have a friend who with their CPA got a job at a non profit and they were worried they would pigeon hole into a specific industry and the concept of non profit worried them about their career. My advice to them was non profit does not mean “not profitable to you.” Depending on the non profit salaries can be greatly outsized and often perks are outstanding. All that excess cash goes somewhere and some non profits enjoy enormous margins and lucrative markets, but the accounting and related rules are specialized.
I'm sure the highly paid charity execs would say so. Trouble is, the charity space often suffers from a broken market feedback mechanism, where the people paying for the product are not the people consuming the product, and this can lead to a business structure that looks like a pure-play marketing machine hooked up to exec pockets with occasional leakage into a small amount of actual charity work.
"But the situation occurs in regular business too! Monopolies, oligopolies, etc happen when the market feedback mechanism breaks!"
Yeah, and we should go after those too. It's really astonishing the lengths to which people go to defend bad behavior.
For instance, the life line company (“help me I’ve fallen and can’t get up”) is (or was) organized as a non profit. They sold devices and services at a decent margin. Their excess revenues went back to employees in wages and perks. Executives and founders especially enjoyed extravagant life styles.
