SROI Blog | Not for Profit?

SROI Blog
 

Not for profit?

I wonder if there is any chance we could stop using ‘not for profit’ to describe a type of organisation. I know people sometimes say that this is short hand for ‘Not for profit distribution’ but leaving aside all the questions this would raise, it still leaves the more fundamental problems unresolved.

Firstly it is not very inspiring to describe organisations by what they are not.

Secondly ‘not for profit’ is the same as ‘for loss’.

Thirdly it is a reason not to address the far more important question which would come from a change of name.

So how about For Social Profit (FSP). Or for those who don’t like the word profit, as in ‘to profit at someone’s expense’, For Social Value (FSV).

These names would help us focus on the main purpose - creating social value – and help us to think about how we can create more value with the resources at our disposal.
 

Comments  

 
0 # Malcolm R Boyd 2011-08-25 13:01
I could not agree more! Social Profit is becoming a more used term. We tend to use the terminology ‘Not for Gain’ as this allows for a broader impact range.
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0 # John Wade 2011-09-23 11:18
I like "more than profit".

We do want to make a profit...so we have money to reinvest in doing more of our activity....to create more profit...and so on.
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0 # Petra Kassun-Mutch 2011-10-10 00:49
I completely agree with this note. I have worked for NFP and "FP" enterprises and am social enterprise business owner. Most NFP I know try to in fact generate an annual surplus so they can reinvest and strengthen programs or stablize their financial positions. Instead of calling it profit though, they call it surplus. ANd there is nothing inherently wrong with organizations who have a financing structure where shareholders expect a return. Its just a different model and typically, companies that require land, equipt and building to do what they do generally have to deal with ROI minded investors because there are no govt grants to make happen.
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0 # Kevin McKenna 2011-11-29 10:26
I couldn't agree more and have commented on this at many a conference. No profit - no future.

I like the idea of FSP, maybe we should start using it in discussions with colleagues and clients until it becomes mainstream?
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0 # ChristianOlsen 2012-01-20 08:20
Yes social value is important ,Different nations with different social values have different customs in communications. Those unfamiliar with the social values of foreign countries would cause some misunderstandin g in communications; therefore, it is necessary to get to know about the different social values beforehand.Chelsea Tickets
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0 # Charles 2012-01-30 13:16
Interesting proposal and there are days when I wish there was an alternative.

Having said that, I find it helpful to distinguish these type of organizations as having no financial owners. Just as important is the concept that profits are not what drives the organization. Lastly, I do not equate "loss" with "not for profit."

The alternatives you propose could easily be applied to for-profit entities as they can and do create social value and profit for society.
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0 # Charlotte Glass 2012-04-03 21:39
Interesting thoughts, I find it's easier to describe social enterprises as "not for profit" as people tend to understand that it's not over inflated wages or share holder dividends for the distribution of the surplus, but reinvestment back into the business for greater social impact.
For a sustainable social enterprise with vision and intended longevity it is also "NOT for loss". So while "For Social Value" seems to sum it all up, it fails to suggest a need for research and development to build on the existing social impact. How about "Surplus for Social Value(SFSV)?
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0 # Isabelle Farquhar 2012-04-20 15:37
I agree with all the comments made. Since social enterprises are set up to create impact (social or environmental) and not just make a surplus/profit,i tend to use the term "more than profit". We also talk about Triple bottom line, ie measuring financial, social and environmental performance. I quite like the idea of using the term "For Social profit" but i wll probably need to explain it every time i use it!
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