Going From a Business to a Nonprofit Career

Did this get on your New Year’s Resolution list?

Business professionals interested in transitioning into a career in the nonprofit sector is not unusual in today’s world. But it hasn’t always been that way. During my early days as an executive recruiter for nonprofit organizations, it was rare that I came across a business professional who was interested in giving up a business career to join a nonprofit organization. There were several reasons for this.

First, business professionals who were interested in nonprofits typically expressed their interest through volunteer activities and through their personal financial contributions. If an experienced CPA, for example, had a desire to apply her skills for the benefit of an inner-city financial counseling organization, she could volunteer her time and talents and come away feeling that she had given back something to the community. She wouldn’t have to become an employee of that agency in order to achieve this sense of altruism, this feeling of doing good and helping others who were less fortunate. And she certainly would not have had to trade off her more than adequate compensation in the business sector for a lower paying nonprofit financial management job in order to be fulfilled in this way. Business aspirations and earning potential were very distinct and totally removed from altruistic aspirations.

Second, I had the clear impression that the nonprofit sector was something of an anomaly to business professionals, resting somewhere between the world of religion and the world of public service. To many business professionals, nonprofits really were an alien “Third Sector,” a separate world that existed for the benefit of do-gooders who seemingly walked out of Father Flanagan’s Boy’s Town movie set, took vows of poverty and lived fairly cloistered and uneventful lives. It is not difficult to understand how this misconception prevailed for so long because most of the earliest nonprofit organizations were founded and served by religious and faith-based groups.

One can understand how the nonprofit sector has been tagged with theological connotations when you multiply the charitable influence that major religious denominations have had in this country by establishing many of the colleges, universities, hospitals, human service organizations and international aid groups over the past 200 years.

Third, while the number of nonprofit organizations in the United States has grown at a remarkably consistent rate over the past century, it has been a very quiet phenomenon. So, nonprofit leadership opportunities were not even on the radar of business professionals. In reality, the nonprofit sector has been one of the fastest growing of all economic sectors, but it has been the least publicized . Today there are approximately 1.5 million tax-exempt organizations in the United States, with about 9 million employees and more than 80 million volunteers that now comprise the Third Sector. Nonprofits account for approximately 10 percent of the entire U.S. economy and 30,000 new charities, on average, are formed each year. In addition to taxes paid as employers, nonprofits contribute to the “in-kind” productivity of the economy as well. According to the Labor Department, approximately 45 percent of the adult population donates an average of 4.3 hours per person of volunteer service every week.

Finally, business professionals generally had little of the above information that could help them understand the impact and depth of the economic contribution of the nonprofit sector, let alone the leadership opportunities on which they might build their careers. There are no Dow Jones Industrial Averages, no S&P 500s, no stock tickers for nonprofits. The metrics that measure and compare the performance of tax-exempt organizations in the nonprofit sector are very different. Through the efforts of such organizations as The Independent Sector and with the emergence of numerous nonprofit web sites such as GuideStar and Charity Navigator, that has changed and much more information is available today.

What’s the status of business-to-nonprofit career transition today? I will be addressing that in my next blog post.

-Rick King, Chairman