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Feb 26

Gupta Governance Institute Nonprofit Seminar Series: George Mitchell and Thad Calabrese

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The Gupta Governance Institute’s Center for Nonprofit Governance at Drexel’s LeBow College of Business in collaboration with the National Center on Nonprofit Enterprise (NCNE) is pleased to announce that George Mitchell (Baruch, CUNY) and Thad Calabrese (NYU) will give an online seminar on Friday, February 26th on the paper The Hidden Cost of Trustworthiness. The abstract for the paper and further details on this seminar can be found below. The interactive seminar will take place via Zoom from 2-3:30 p.m. EST.

This paper is part of a four-part series on the theme of managing nonprofit organizations in a crisis. The series seeks to highlight frontiers of knowledge and new research important for the nonprofit field and provide a regular, national/international forum for academic researchers to explore these and other areas in depth.

ABSTRACT The theory of the nonprofit institutional form developed by Henry Hansmann and Burton Weisbrod emphasizes the importance of organizational trustworthiness in a sector defined by hard-to-measure outputs. This body of theory rationalizes a normative approach to nonprofit financial management focused on maintaining organizational trustworthiness through fiscal probity signals. Such signals may include measurable indicators of overhead minimization, fiscal leanness, revenue diversification and debt avoidance, among others. Appropriate signaling behavior may increase organizational trustworthiness, but the effects on mission impact are not well understood. Thus, this article assesses how adherence to common fiscal probity norms affects mission impact, using total spending as a proxy. Based on a panel of donative nonprofits spanning 1982-2019, analysis suggests that norm-adhering nonprofits sacrifice nearly half of their mission impact over a ten-year period compared to norm-busting nonprofits. This forgone mission impact is the hidden cost of trustworthiness.

The interactive seminar will take place via Zoom followed by discussion and a Q&A session.

Audience

Higher Education
Faculty
Non-profit

Have Questions?

Teresa Harrison, PhD

Academic Director of the Center for Nonprofit Governance

(215) 895-0556

Gerri C. LeBow Hall 1021