JBWere and NAB have launched John McLeod’s “The Cause Report – 20 years of (r)evolution in the nonprofit sector” which is the first major statistical analysis of the charitable and non profit sector since 1996.  The report will be available on the JBWere website from mid-March 2016.

John has sifted through masses of information from both the ACNC and the Australian Bureau of Statistics to collate an up to date financial snapshot of the sector, and how it contributes to our economy and society.  The report also captures information on government controlled not for profit entities such as public schools and hospitals which do not report to the ACNC and the ABS.

The report addresses the question – what does the not for profit sector look like as a whole? and continues the work of the 1996 Third Sector Report by Mark Lyons.

While there are acknowledged to be around 57,000 charitable organisations in Australia, there are also about 500,000 small and unincorporated not for profit entities.  The sector employs 8% of Australia’s workers and generates $200billion in income annually.  At the moment 10 new charities are registered daily, and the number of charities is doubling annually.

Here are a few tasters of what the report includes:

1. The top four charitable organisations by income have not changed substantially in the last twenty years – the Australian Red Cross, World Vision and the Salvation Army top the list though their rankings might have moved slightly.
2. The sector has an asset base of $350billion – with most of the assets held in education and aged care in property
3. While the 80/20 rule seems to apply to the rest of the world, in the charitable sector it seems to be 92/8 – ie 92% of the funds are held by 8% of the organisations.
4. The income mix has changed only slightly in the last 20 years, with philanthropy steady at 8%, government funding increasing from 30% to 38% and self-earned income dropping to 54%.
5. The proportion of individuals donating to the charitable sector has remained steady, however the good news is that the average donation has increased.
6. 8.5% of the workforce is in the charity sector.
7. Volunteering is valued at $30 per hour.
8. Margins in the sector are around 5%.

At the launch John provided a snapshot of three sectors within the nonprofit sector.

Arts and Culture reflect the broader sector most closely in terms of income and expenses and demonstrate a 13% profit marketing and 4.4 volunteers per employee.

Grantmaking – ie trusts and foundations show 8 volunteers per employee (which I imagine is mostly board members and trustees) and holds $15billion in assets.

International aid demonstrates the lowest profit margins with income most closely aligned to expenditure – and with 74% of income coming from donations and bequests, while the religious sector remains the single largest cause for philanthropic gifts (even non-tax deductible).

Once the report becomes available you will be able to examine John’s intricate graphs and data in more detail.

The launch concluded with a brief panel discussion with John, Sarah Davies, CEO of Philanthropy Australia, and Daniel Madhaven, CEO of Impact Investing Australia, facilitated by Shamal Dass, Head of Philanthropic Services at JBWere.  This touched on how Impact Investing can fit into the income mix for charitable organisations, what the role of philanthropy is given its 8% contribution to the not for profit sector, and the opportunity for “social risk capital”.