Investigating Nonprofit Self-Regulation: Insights from Two Decades of Nonprofit Studies in "Voluntas," "Nonprofit and Voluntary Sector Quarterly," and "Nonprofit Management and Leadership"

• In Event: Civil society in restrictive environments

Abstract

Nonprofit organizations (NPOs), operating across diverse institutional environments that can be either more supportive or more restrictive, find themselves continuously interacting with an array of stakeholders including beneficiaries, donors, governments, media, and the public (Willems et al. 2017; Gugerty, Sidel, and Bies 2010; Bies 2010). Since the 1990s, largely driven by the sector’s growth and trust challenges stemming from high-profile corruption and mismanagement, stakeholders worldwide have been escalating their demands for accountability, transparency, and effectiveness from NPOs (Dolšak and Prakash 2022; Crack 2018; Ito and Slatten 2018; Hielscher et al. 2017; Bies 2010; Gugerty, Sidel, and Bies 2010; Gugerty 2010; Gugerty 2008).

Concurrently, NPOs, as stewards of public trust and imperative agents of public good, are intrinsically motivated to safeguard and enhance their "moral capital" (Ito and Slattwenty 2018; Hielscher et al. 2017; Sidel 2005). This internal commitment, coupled with the previously discussed external pressures, has catalyzed the adoption of self-regulation practices within the global nonprofit sector, particularly in regions where state regulatory frameworks are lacking, inadequate, or overly rigorous (see Dolšak and Prakash 2022; Breen, Dunn, and Sidel 2019; AbouAssi and Bies 2018; etc.).

This movement, identified by Sidel (2005) as “a new wave of nonprofit self-regulation,” has captured scholarly interest, emphasizing the importance of exploring how NPOs devise and apply self-regulatory practices to maintain legitimacy, ensure public trust, and address societal demands effectively. As noted in several studies (e.g., Toepler and Anheier 2021; AbouAssi and Bies 2018; Kennedy 2018; Sidel 2010; Gugerty 2008), research on nonprofit self-regulation can not only contribute to a more responsive, accountable, and effective nonprofit sector, but also offer valuable insights into the evolving dynamics of contemporary governance.

The review, encompassing two decades (2000-2023) of scholarly output from three prominent journals in nonprofit studies—"Voluntas," "Nonprofit and Voluntary Sector Quarterly," and "Nonprofit Management and Leadership"—delves into the intricacies of nonprofit self-regulation. The focus has been on defining self-regulation in the nonprofit context, identifying its driving factors, exploring its mechanisms, and understanding its relationship with the state regulatory regime.

After meticulous selection, 20 articles were chosen for in-depth analysis. The findings indicate that nonprofit self-regulation is predominantly seen as a collective effort by nonprofits to actively uphold and demonstrate accountability and effectiveness, distinct from state-driven regulation. The development of self-regulation is driven by both external stakeholder demands (demand-side drivers) and internal nonprofit motivations (supply-side drivers). A typology inspired by Scott’s institutional framework was created. Nonprofit self-regulation was identified as an intricate mix of voluntary and mandatory, local and international, and formal and informal mechanisms. While facing challenges like insufficient incentives and enforcement, self-regulation enables nonprofits to improve credibility and governance, though further study is needed to fully understand these mechanisms and their evolution. The interaction between nonprofit self-regulation and state regulation, influenced by diverse factors, helps understand the dynamics between the two forms of regulation. A visual representation of the relationship further illustrated the complex interplay between state and nonprofit self-regulation.

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Author

• Huitan Xu, Indiana University Lilly Family School of Philanthropy