These are voluntary organisations, charities and institutions that have a cause they campaign for and who generally have two types of staff, paid workers as well as unpaid volunteers. A not for profit organisation is also called a NOP as well as a non profit organisation, as these names and terms suggest they are completely different from for-profit companies. They can be set up as registered charities or as trusts, and get their income from external funding and donations from private individuals, grants from government or they set up their own enterprises like charity shops etc.
Essentially NPO’s do not set out with the intention of making profits for their directors. If they do make any money from say charity shops or other activities and enterprises, they like to call it a surplus and it is invested back into their organisation as well as their projects and initiatives. There are many charity jobs available in the not for profit sector, these can range from working in a charity shop to being employed as a fundraiser. As interesting point to note is that this sector is also sometimes referred to as the ‘third sector’.
Accountability is a very important part of the set up of any not for profit organisation, they have to be seen as doing the right thing. This is to ensure they retain the trust of people who donate to them, and also because of government regulations mean that many non profit organisations also have a tax exempt status. They show their financial transparency by producing a annual profit and loss account listing their income and also expenditure over the past year. Indeed in some countries they are regulated heavily and must do this. In the United Kingdom NPO’s have to have a Memorandum of Association and be listed as a registered charity, all of this means they have the benefit of limited liability.
Most of the staff of any not for profit organisation will be volunteers, these are people who will give either a few hours or a few days of their time every week to the organisation for free. There are three main beneficiaries of these NPO’s, they are individual people, other institutions that offer a service to the public like schools and medical centres, and finally there is the environmental and animals etc.
The administrative set up of a NPO is very much similar to that of a private business in that there is a management structure with may have board members as well as trustees. As regards trusts, some of them have board members who are elected officials by the organisations members whilst others have managers who just apply for the position. They can be small organisations based around serving a certain need of a local community or they can be a national organisation like Christian Aid with shops and offices around the country.