Advertisement

Impact of the EU Structural Funds on Financial Capacities of Non-profit Organizations

  • Oto Potluka
  • Martin Spacek
  • Georg von Schnurbein
Original Paper

Abstract

To fulfil their role, non-profit organizations (NPOs) need sufficient capacities. These include, first and foremost, financial capacity. EU Cohesion Policy commands financial resources of 351.8 bn. EUR. The EU is also willing to support NPOs from this source. With such considerable funding, the research questions arise: How much money have NPOs received? What are the effects of such assistance on the financial capacities of NPOs? On a sample of 2715 non-profit organizations in the Czech Republic, we have found that EU subsidies have a positive impact on financial capacities, measured as real assets. It is caused by using EU funds for investment. We have not proved an effect on short-term financial capacities measured on revenues. Moreover, the distribution of financial support among PBOs is unequal as 4% of NPOs collected 80% of subsidies due to differences in skills among NPOs’ managers.

Keywords

Non-profit organizations Financial capacities Assets Cohesion Policy The Czech Republic 

Résumé

Pour remplir leur rôle, les organismes sans but lucratif doivent jouir de capacités suffisantes, parmi lesquelles la capacité financière est de premier rang. La politique de cohésion de l’Union européenne recommande l’accès à des ressources financières de l’ordre de 351,8 milliards d’euros. L’UE est aussi prête à soutenir financièrement les organismes sans but lucratif à cette fin. Un tel financement soulève les questions suivantes: quelle somme les organismes sans but lucratif ont-ils reçue? Quelles incidences une assistance de cet ordre a-t-elle sur les capacités financières des organismes sans but lucratif? En étudiant un échantillon de 2 715 organismes sans but lucratif de la République tchèque, nous avons découvert que les financements de l’UE ont des répercussions positives sur les capacités financières mesurées en capitaux réels. Les fonds de l’UE pour l’investissement en sont responsables. Nous n’avons pas pu démontrer d’effet sur les capacités financières à court terme mesurées en termes de revenus. Qui plus est, la distribution de l’aide financière parmi les organismes dédiés au bien public est inégale. En effet, 4% des organismes sans but lucratif ont récolté 80% des subventions en raison des différences qui existent parmi les compétences des directeurs de ces derniers.

Zusammenfassung

Non-Profit-Organisationen benötigen ausreichend Kapazitäten, um ihre Rolle erfüllen zu können. Darin eingeschlossen ist vor allem die finanzielle Kapazität. Die EU-Kohäsionspolitik umfasst finanzielle Ressourcen in Höhe von 351,8 Mrd. Euro, und die EU ist bereit, Non-Profit-Organisationen aus dieser Quelle zu unterstützen. Bei diesen beträchtlichen Finanzmitteln ergeben sich folgende Forschungsfragen: Wieviel Geld haben Non-Profit-Organisationen erhalten? Wie wirkt sich diese Unterstützung auf die finanziellen Kapazitäten der Non-Profit-Organisationen aus? Anhand einer Stichprobe von 2.715 Non-Profit-Organisationen in der Tschechischen Republik kamen wir zu dem Ergebnis, dass sich EU-Subventionen - gemessen als Sachgüter - positiv auf die finanziellen Kapazitäten auswirken. Dies ist auf die Nutzung der EU-Gelder für Investitionen zurückzuführen. Wir haben keinen Nachweis für den Effekt auf kurzfristige finanzielle Kapazitäten gemessen an Einkommen. Darüber hinaus verteilt sich die finanzielle Unterstützung ungleich zwischen den gemeinnützigen Organisationen; denn 4% der Non-Profit-Organisationen erhielten 80% der Subventionen, was auf die unterschiedlichen Fertigkeiten der Leiter dieser Organisationen zurückzuführen ist.

Resumen

Para cumplir su papel, las organizaciones sin ánimo de lucro (NPO, por sus siglas en inglés) necesitan las capacidades suficientes. Éstas incluyen, ante todo, capacidad financiera. La Política de Cohesión de la UE domina recursos financieros por 315 800 millones EUR. La UE está también dispuesta a apoyar a las NPO con esta fuente. Con una financiación tan considerable, surgen las preguntas de investigación: ¿Cuánto dinero han recibido las NPO? ¿Cuáles son los efectos de dicha asistencia sobre las capacidades financieras de las NPO? En una muestra de 2 715 organizaciones sin ánimo de lucro en la República Checa, hemos encontrado que los subsidios de la UE tienen un impacto positivo sobre las capacidades financieras, medidas como activos reales. Esto se produce mediante el uso de fondos de la UE para inversión. No hemos probado un efecto sobre las capacidades financieras a corto plazo medidas en ingresos. Asimismo, la distribución del apoyo financiero entre las organizaciones de interés públicos (PBO, por sus siglas en inglés) es desigual, ya que el 4% de las NPO cobraron el 80% de los subsidios debido a las diferencias en habilidades entre los responsables de las NPO.

摘要

为履行其职责,非盈利组织 (NPO) 需要足够的能力,包括首要的是财务能力。欧盟凝聚政策管理着3518亿欧元的财务资源。欧盟也愿意通过这一来源来支持NPO。在拥有如此可观的资金的情况下,出现的研究问题是:NPO收到了多少资金?此类帮助对NPO财务能力的影响是什么? 通过捷克共和国的2,715份非盈利组织样本,我们发现,以实际资产来测量,欧盟补助会对财务能力带来积极的影响。原因在于,这会将欧盟资金用于投资。我们未证明以收入测量的短期财务能力的影响。此外,PBO之间的财务支持分布不均衡,4%的NPO获得了80%的补助,原因是NPO管理人员的技能差别。

要約

非営利組織(NPO)では、役割を果たすために十分な能力が必要となる。この中には財務能力がすべて含まれる。EUでは、3518億ユーロの財源が必要とされる。EUは同様に経済的にNPOを支えようとしている。重要な結果から次の疑問が生じる。 NPOはいくら資金を受けとるか。NPOの財務能力を支える影響力は何か。 チェコ共和国における2715件のNPOのサンプルから、EUの助成金は財務能力に肯定的な影響力を持ち、実物資産として測定される。これはEUの投資資金として使われる。収益の観点からの短期的な財務能力については、その影響力は検証されていない。さらに、PBOの財政的な寄付によって、NPOの管理者のスキルの相違によって、80パーセントの助成金のうち4パーセントに不均衡がある。

ملخص

لإتمام دورهم ، المنظمات الغير ربحية (NPOs) تحتاج قدرات كافية. هذا يشمل ، أولا” وقبل كل شيء، قدرة مالية. هيمنة الموارد المالية لسياسة تماسك الإتحاد الأوروبي (EU) ل 351.8ملياريورو. الإتحاد الأوروبي مستعد أيضا” لدعم المنظمات الغير ربحية (NPOs) من هذا المصدر. مع هذا التمويل الكبير، نتجت الأسئلة البحثية: كم من المال قد تلقت المنظمات الغير ربحية (NPOs) ؟ ما هي الآثار المترتبة على هذه المساعدة على القدرات المالية للمنظمات الغير ربحية (NPOs)؟ على عينة من 2715 من المنظمات الغير ربحية في جمهورية التشيك، وجدنا أن دعم الإتحاد الأوروبي(EU) له تأثير إيجابي على القدرات المالية ، يقاس كأصول حقيقية. ناتجة عن إستخدام أموال الإتحاد الأوروبي (EU) للإستثمار. نحن لم نثبت أن له تأثير على قدرات مالية قصيرة الأجل تم قياسها على الإيرادات. علاوة على ذلك، فإن توزيع الدعم المالي بين منظمات النفع العام (PBOs) غير متكافئ لأن 4٪ من المنظمات الغير ربحية (NPOs) جمعت 80٪ من الدعم بسبب إختلافات في المهارات بين مديري المنظمات الغير ربحية (NPOs).

References

  1. Alasuutari, P. (2013). Spreading global models and enhancing banal localism: The case of local government cultural policy development. International Journal of Cultural Policy, 19(1), 103–119. doi: 10.1080/10286632.2011.625418.CrossRefGoogle Scholar
  2. Anheier, H. K. (2014). Nonprofit organisations: Theory, management, policy. Glasgow: Routledge.Google Scholar
  3. Bernhard, M. (1993). Civil society and democratic transition in East Central Europe. Political Science Quarterly, 108(2), 307–326.CrossRefGoogle Scholar
  4. Bowman, W. (2002). The uniqueness of nonprofit finance and the decision to borrow. Nonprofit Management and Leadership, 12(3), 293–311. doi: 10.1002/nml.12306.CrossRefGoogle Scholar
  5. Bowman, W. (2011). Financial capacity and sustainability of ordinary nonprofits. Nonprofit Management and Leadership, 22(1), 37–51. doi: 10.1002/nml.20039.CrossRefGoogle Scholar
  6. Bowman, W., Tuckman, H. P., & Young, D. R. (2012). Issues in nonprofit finance research: Surplus, endowment, and endowment portfolios. Nonprofit and Voluntary Sector Quarterly, 41(4), 560–579. doi: 10.1177/0899764011411925.CrossRefGoogle Scholar
  7. Carmin, J. (2010). NGO capacity and environmental governance in Central and Eastern Europe. Acta Politica, 45(1–2), 183–202. doi: 10.1057/ap.2009.21.CrossRefGoogle Scholar
  8. Chikoto, G. L., & Neely, D. G. (2014). Building nonprofit financial capacity: The impact of revenue concentration and overhead costs. Nonprofit and Voluntary Sector Quarterly, 43(3), 570–588. doi: 10.1177/0899764012474120.CrossRefGoogle Scholar
  9. Cornell Gorka, K. (1996). US support for nongovernmental organizations. In M. Lazar (Ed.), Fortifying the foundations. US support for developing and strengthening democracy in East Central Europe. New York: Institute of International Education.Google Scholar
  10. Czike, K. (2010). Civil society and social capital in Central and Eastern Europe. In H. K. Anheier & S. Toepler (Eds.), International encyclopedia of civil society (pp. 223–230). New York: Springer.Google Scholar
  11. CZSO. (2015). Latest economical figures on non-profit institutions (year 2012). Retrieved November 1, 2015, from http://apl.czso.cz/pll/rocenka/rocenka.indexnu_sat?mylang=EN
  12. EC. (2014). The European code of conduct on partnership in the framework of the European structural and investment funds. Brussels: EC.Google Scholar
  13. EC. (2015a). Cohesion policy data. Retrieved November 1, 2015, from https://cohesiondata.ec.europa.eu/
  14. EC. (2015b). Total allocations of cohesion policy 20142020* (million €). Retrieved November 1, 2015, from http://ec.europa.eu/regional_policy/en/funding/available-budget/
  15. Epperly, B., & Lee, T. (2015). Corruption and NGO sustainability: A panel study of post-communist states. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(1), 171–197. doi: 10.1007/s11266-013-9404-3.CrossRefGoogle Scholar
  16. Fagan, A. (2006). Transnational aid for civil society development in post-socialist Europe: Democratic consolidation or a new imperialism? Journal of Communist Studies and Transition Politics, 22(1), 115–134. doi: 10.1080/13523270500508437.CrossRefGoogle Scholar
  17. Frič, P. (2004). Politický vývoj ve střední Evropě po r. 1989 a jeho dopad na neziskový sektor. Retrieved May 5, 2015, from http://www.ceses.cuni.cz/CESES-20-version1-sesit04_03_fric.pdf
  18. Frič, P. (2015). Občanská společnost a definice NNO, vývoj, stav a trendy. Retrieved June 10, 2016, from https://www.vlada.cz/assets/ppov/rnno/dokumenty/studie_fric_pro_web.pdf
  19. Frič, P., Goulli, R., & Vyskočilová, O. (2004). Small development within the bureaucracy interests: The nonprofit sector in the Czech Republic. In A. Zimmer & E. Priller (Eds.), Future of civil society: Making Central European nonprofit-organizations work (pp. 601–634). Wiesbaden: VS Veralg für Sozialwissenschaften.Google Scholar
  20. GCNNO. (2008). Zhodnocení koncepce podpory rozvoje neziskového sektoru. Prague: Government Council for Non-Governmental Non-Profit Organisations.Google Scholar
  21. GCNNO. (2015). Státní politika vůči nestátním neziskovým organizacím na léta 2015–2020. Prague: Government Council for Non-Governmental Non-Profit Organisations.Google Scholar
  22. GCNNO. (2016). Rozbor financování nestátních neziskových organizací z veřejných rozpočtů v roce 2014. Prague: Government Council for Non-Governmental Non-Profit Organisations.Google Scholar
  23. Gertler, P. J., Martinez, S., Premand, P., Rawlings, L. B., & Vereersch, C. M. J. (2011). Impact evaluation in practice. Washington: The World Bank.Google Scholar
  24. Harvey, B. (2004). The illusion of inclusion: Access by NPOs to the structural funds in the new member states of eastern and central Europe. Brussels: ECAS.Google Scholar
  25. Helmig, B., Ingerfurth, S., & Pinz, A. (2014). Success and failure of nonprofit organizations: Theoretical foundations, empirical evidence, and future research. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 25(6), 1509–1538. doi: 10.1007/s11266-013-9402-5.CrossRefGoogle Scholar
  26. HOPE-E.S. (2012). Evaluační studie zapojení nestátních neziskových organizací do realizace programů ze strukturálních fondů v České republice: Závěrečná zpráva. Prague: Ministry for Regional Development of the Czech Republic.Google Scholar
  27. Howard, M. M. (2002). The weakness of postcommunist civil society. Journal of Democracy, 13(1), 157–169.CrossRefGoogle Scholar
  28. Kárníková, A. (2012). Do they actually matter? The impact of NGOs on the European instrument for democracy and human rights (EIDHR). Perspectives: Central European Review of International Affairs, 20(1), 83–109.Google Scholar
  29. Khandker, S. R., Koolwal, G. B., & Samad, H. A. (2010). Handbook on impact evaluation: Quantitative methods and practice. Washington: The World Bank.Google Scholar
  30. Kundrata, M. (Ed.). (2007). Dopady členství ČR v EU na NNO v programovacím období 2004–2006. Prague: The Government Council for Non-Governmental Non-Profit Organisations.Google Scholar
  31. Kuti, É. (1999). Different Eastern European countries at different crossroads. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 10(1), 51–60. doi: 10.1023/A:1021491720489.CrossRefGoogle Scholar
  32. Lam, M., & McDougle, L. (2015). Community variation in the financial health of nonprofit human service organizations: An examination of organizational and contextual effects. Nonprofit and Voluntary Sector Quarterly. doi: 10.1177/0899764015591365.Google Scholar
  33. Lane, D. (2010). Civil society in the old and new member states. European Societies, 12(3), 293–315. doi: 10.1080/14616696.2010.483008.CrossRefGoogle Scholar
  34. Manjon, J. V., Tohka, J., Garcia-Marti, G., Carbonell-Caballero, J., Lull, J. J., Marti-Bonmati, L., et al. (2008). Robust MRI brain tissue parameter estimation by multistage outlier rejection. Magnetic Resonance in Medicine, 59(4), 866–873. doi: 10.1002/mrm.21521.CrossRefGoogle Scholar
  35. Nałęcz, S., Leś, E., & Pieliński, B. (2015). Poland: A new model of government–nonprofit relations for the east? VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(6), 2351–2378. doi: 10.1007/s11266-015-9653-4.CrossRefGoogle Scholar
  36. Neziskovky.cz. (2015). Statistika počtu nestátních neziskových organizací v letech 1990–2013. Prague.Google Scholar
  37. Nikolova, M. (2015). Government funding of private voluntary organizations: Is there a crowding-out effect? Nonprofit and Voluntary Sector Quarterly, 44(3), 487–509. doi: 10.1177/0899764013520572.CrossRefGoogle Scholar
  38. Novotný, J., & Lukeš, M. (Eds.). (2008). Faktory úspěchu nestátních neziskových organizací. Prague: Nakladatelství Oeconomica.Google Scholar
  39. Oriniakova, P. (Ed.). (2009). Structural funds and partnership: An analysis of the partnership of public administration with non-governmental non-profit organizations in Central and Eastern Europe. Prague: Centre for Community Organizing.Google Scholar
  40. Osborne, S. P. (2012). Debate: Can the third sector survive the recession? Evidence from Scotland. Public Money and Management, 32(4), 245–247. doi: 10.1080/09540962.2012.691296.CrossRefGoogle Scholar
  41. Pajas, P. (1999). Endowments of foundations receive contributions from the state privatization fund of the Czech Republic. The International Journal of Not-for-Profit Law, 2(2). Reprint www.icnl.org.
  42. Pajas, P., & Vilain, M. (2004). Finance of Nonprofit Organizations. In A. Zimmer & E. Priller (Eds.), Future of civil society: Making central European nonprofit-organizations work (pp. 601–634). Wiesbaden: VS Verlag für Sozialwissenschaften.Google Scholar
  43. Petrova, V. P. (2007). Civil society in post-communist Eastern Europe and Eurasia: A cross-national analysis of micro- and macro-factors. World Development, 35(7), 1277–1305. doi: 10.1016/j.worlddev.2006.09.019.CrossRefGoogle Scholar
  44. Potluka, O. (Ed.). (2010). Impact of EU cohesion policy in Central Europe. Leipzig: Leipziger Universitätsverlag GmbH.Google Scholar
  45. Prentice, C. R. (2015a). Understanding nonprofit financial health: Exploring the effects of organizational and environmental variables. Nonprofit and Voluntary Sector Quarterly. doi: 10.1177/0899764015601243.Google Scholar
  46. Prentice, C. R. (2015b). Why so many measures of nonprofit financial performance? Analyzing and improving the use of financial measures in nonprofit research. Nonprofit and Voluntary Sector Quarterly. doi: 10.1177/0899764015595722.Google Scholar
  47. Quigley, K. F. F. (1996). For democracy’s sake: How funders fail- and succeed. World Policy Journal, 13(1), 109–118.Google Scholar
  48. Regulska, J. (1999). NGOs and their vulnerabilities during the time of transition: The case of Poland. International Journal of Voluntary and Nonprofit Organizations, 10(1), 61–71.CrossRefGoogle Scholar
  49. Rikmann, E., & Keedus, L. (2013). Civic sectors in transformation and beyond: Preliminaries for a comparison of six Central and Eastern European societies. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 24(1), 149–166. doi: 10.1007/s11266-012-9305-x.CrossRefGoogle Scholar
  50. Rose-Ackerman, S. (2007). From elections to democracy in Central Europe: Public participation and the role of civil society. East European Politics and Societies, 21(1), 31–47. doi: 10.1177/0888325406297132.CrossRefGoogle Scholar
  51. Rosenbaum, P. R., & Rubin, D. B. (1983). The central role of the propensity score in observational studies for causal effects. Biometrika, 70(1), 41–55. doi: 10.1093/biomet/70.1.41.CrossRefGoogle Scholar
  52. Salamon, L. M., Sokolowski, S. W., Haddock, M. A., & Tice, H. S. (2013). The state of global civil society and volunteering: Latest findings from the implementation of the UN nonprofit handbook. Retrieved May 15, 2015, from http://ccss.jhu.edu/wp-content/uploads/downloads/2013/04/JHU_Global-Civil-Society-Volunteering_FINAL_3.2013.pdf
  53. Sokolowski, S. W. (2013). Effects of government support of nonprofit institutions on aggregate private philanthropy: Evidence from 40 countries. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 24(2), 359–381. doi: 10.1007/s11266-011-9258-5.CrossRefGoogle Scholar
  54. Stark, D., & Bruszt, L. (1998). Postsocialist pathways: Transforming politics and property in East Central Europe. Cambridge: Cambridge University Press.Google Scholar
  55. Suleiman, L. (2013). The NGOs and the grand illusions of development and democracy. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 24(1), 241–261. doi: 10.1007/s11266-012-9337-2.CrossRefGoogle Scholar
  56. Szent-Iványi, B., & Tétényi, A. (2008). transition and foreign aid policies in the Visegrád countries: A path dependant approach. Transition Studies Review, 15(3), 573–587. doi: 10.1007/s11300-008-0021-6.CrossRefGoogle Scholar
  57. Tevel, E., Katz, H., & Brock, D. M. (2015). Nonprofit financial vulnerability: Testing competing models, recommended improvements, and implications. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(6), 2500–2516. doi: 10.1007/s11266-014-9523-5.CrossRefGoogle Scholar
  58. Tohka, J., Zijdenbos, A., & Evans, A. (2004). Fast and robust parameter estimation for statistical partial volume models in brain MRI. Neuroimage, 23(1), 84–97. doi: 10.1016/j.neuroimage.2004.05.007.CrossRefGoogle Scholar
  59. Tuckman, H. P., & Chang, C. F. (1991). A methodology for measuring the financial vulnerability of charitable nonprofit organizations. Nonprofit and Voluntary Sector Quarterly, 20(4), 445–460. doi: 10.1177/089976409102000407.CrossRefGoogle Scholar
  60. USAID. (2011). The 2010 NPO sustainability index for Central and Eastern Europe and Eurasia. Washington: U. S. Agency for International Development.Google Scholar
  61. USAID. (2012). The 2011 CSO sustainability index for Central and Eastern Europe and Eurasia. Washington: U. S. Agency for International Development.Google Scholar
  62. USAID. (2014). The 2013 NPO sustainability index for Central and Eastern Europe and Eurasia. Washington: U. S. Agency for International Development.Google Scholar
  63. Vaceková, G., & Svidroňová, M. (2014). Benefits and risks of self-financing of NGOs: Empirical evidence from the Czech Republic, Slovakia and Austria. E + M Ekonomie a Management, XVII(2), 120–130. doi: 10.15240/tul/001/2014-2-009.CrossRefGoogle Scholar
  64. Vaceková, G., Valentinov, V., & Nemec, J. (2016). Rethinking nonprofit commercialization: The case of the Czech Republic. International Journal of Voluntary and Nonprofit Organizations. doi: 10.1007/s11266-016-9772-6.Google Scholar
  65. Vrzáček, P. (2014). Profesionalizace NNO a lidské zdroje, návrhy opatření. Prague: Government Council for Non-Governmental Non-Profit Organisations.Google Scholar
  66. Warleigh, A. (2001). ‘Europeanizing’ civil society: NGOs as agents of political socialization. Journal of Common Market Studies, 39(4), 619–639. doi: 10.1111/1468-5965.00324.CrossRefGoogle Scholar
  67. Wicker, P., Longley, N., & Breuer, C. (2015). Revenue volatility in German nonprofit sports clubs. Nonprofit and Voluntary Sector Quarterly, 44(1), 5–24. doi: 10.1177/0899764013499072.CrossRefGoogle Scholar
  68. Wilsker, A. L., & Young, D. R. (2010). How does program composition affect the revenues of nonprofit organizations? Investigating a benefits theory of nonprofit finance. Public Finance Review, 38(2), 193–216. doi: 10.1177/1091142110369238.CrossRefGoogle Scholar

Copyright information

© International Society for Third-Sector Research and The Johns Hopkins University 2017

Authors and Affiliations

  1. 1.CEPSUniversity of BaselBaselSwitzerland
  2. 2.SPECTRA Centre of Excellence EUSlovak University of Technology in BratislavaBratislavaSlovakia

Personalised recommendations