Relationships Between Nonprofit and For-Profit Organizations: A Stakeholder Perspective
Abstract
The purpose of this article is to provide a new, more comprehensive stakeholder theory of
the relationships between nonprofit, for-profit, and government sectors. This theory combines
aspects of neoclassical economics and principal-agency theory to complement the
traditional notions that these organizations either compete or exist in a vacuum relative
to one another. The article discusses nonprofit organizations that are employee groups
(unions and professional associations), shareholders (institutional investors including
pension funds and endowments), community and other interest groups, government
contractors, competitors, consumers, and suppliers. By viewing these organizations as
agents relative to a principal for-profit (or government) organization, it is possible to
hypothesize about relationships and behaviors between organizations of different sectors
of the economy. This new perspective allows a better understanding of the many relationships
observed in the nonprofit sector and of a much greater range of nonprofit stakeholders
than is currently possible given existing theory.
Rights
This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.Collections
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