In recent years the discourse on nonprofits and the function of nonprofit organizations in society has included a new term, a term that, depending on who you ask, may cause interest, confusion, or derision. The term, I am referring to is the “nonprofit industrial complex”. In 2004, the term was coined by INCITE!, a national activist organization which fights against violence against women, gender non-conforming, and trans people of color. The Nonprofit Industrial Complex’s Hold on Social Justice, JC Samimi, Columbia Social Work Review, Volume I. But more recently, the term has begun to enter more mainstream discussions surrounding nonprofit organizations and what role nonprofits have in disrupting systems of power and oppression.
Unfortunately, a concise definition of the “nonprofit industrial complex” does not exist but is rather discussed through several thoughts and definitions from experts, thinkers, organizers, and activists in this realm. Simply (and perhaps reductively) put, the concept of the nonprofit industrial complex suggests that the nonprofit sector, despite its intentions to address social issues and promote social justice, can become co-opted by systems of power and feed into the same inequalities which the nonprofit sector seeks to address.
Those who advocate challenging and/or dismantling the nonprofit industrial complex often criticize the nonprofit sector as becoming increasingly professionalized, adopting management practices and hierarchies like those in the for-profit sector. This professionalization and bureaucratization can create power dynamics within organizations, with executive directors and boards of directors making decisions that may not align with the needs and aspirations of the communities they aim to serve.
Under traditional models of nonprofit governance (what some might consider those governance models that feed into the nonprofit industrial complex), the nonprofit organization can often be viewed through the lends of a pyramid, with the Board of Directors at the top, staff in the middle, and the community forming the base out of which the pyramid grows to fulfill the community need. However, what we often see in this model, is an organization that often believes that it and its purposes solely represent the voice of the community and the work and activity of the community itself often becomes (at least in though and attitude) a programmatic function of the nonprofit. Under this model, the community’s needs, desires, and purposes become a secondary priority of the organization and the organization’s own health and well-being takes first priority.
Under new egalitarian models of nonprofit governance, organizational leadership takes its cue from the community voice. The nonprofit becomes a tool for the community to use in its action and advocacy. Its purposes and direction are not only created and born out of the needs and desires of the community but also directed by the community as well. It becomes a aspect of the community rather than a representation of the community itself.
Some of these egalitarian models might include having a stronger membership body made up of members of the community (or the community itself) that has certain ratification/approval authority over an organization’s board of directors or the ability to elect members of the board. Some might include having strong advisory or board-delegated committees that are comprised of members of the community to ensure communication and accountability flow between the nonprofit and the community. Ultimately, the options to use for egalitarian models are numerous, and it does not necessarily matter which model an organization uses so long as the model works for the organization and the community and complies with the legal requirements of laws governing nonprofit organizations.
To learn more about how you can form an organization with egalitarian governance models (or change an organization’s governance model to be more egalitarian), please attend the Washington State Nonprofit Conference this week starting on Wednesday (May 17, 2023) and ending on Friday (May 19, 2023) put on by the Nonprofit Association of Washington and visit Jacob Ferrari and Tara Vitale at their talk, Flipping the Pyramid: Egalitarian Alternatives to Traditional Nonprofit Governance Models (10:30am on May 17, 2023).
This blog is for educational purposes only and does not constitute legal advice. This article, or contacting Apex, does not in any way form an attorney-client relationship. Speak to a licensed attorney if you need help or advice in how to dissolve your organization. If you have any questions or would like to learn more, please contact me at jacob@apexlg.com or visit our website and blog.