Determinants and Consequences of Nonprofit Transparency

Determinants and Consequences of Nonprofit Transparency

Nonprofits that proactively shared their organizational information with the public received substantially more in total contributions the following year than nonprofits that were less transparent, a report published in the Journal of Accounting, Auditing & Finance finds. Based on data from sixty-three hundred nonprofits in the GuideStar database, the report, Determinants and Consequences of Nonprofit Transparency, found that organizations that voluntarily took action to improve their transparency and earned a GuideStar Seal of Transparency saw an average increase of 53 percent in their total contributions a year later while demonstrating stronger performance across a range of governance, financial, and operational dimensions. Authored by professors Erica Harris (Villanova University) and Daniel Neely (University of Wisconsin – Milwaukee), the report draws the conclusion that donors will show their appreciation for a nonprofit's efforts to improve its transparency by increasing their funding for the organization.

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