The United Nations announced at last week's meeting of the Statistical Commission a plan to implement a new approach to treating nonprofit organizations in national economic statistics around the world. Developed in collaboration with researchers at Johns Hopkins, this new approach brings together data on nonprofit organizations for the first time in national statistical reports, and also puts a value on the volunteer effort that these organizations often generate.
The Handbook on Nonprofit Institutions in the System of National Accounts will be published and made available by the United Nations to statisticians in the 180 member nations. It will help account for the voluntary and nonprofit sector, which is largely merged with other sectors under standard U.N. reporting, said Lester Salamon, director of the Center for Civil Society Studies at Hopkins' Institute for Policy Studies and director of the project that led to the creation of the new U.N. handbook.
"This handbook, once implemented, will put the nonprofit sector on the economic map of the world for the first time in a permanent way," Salamon said.
The handbook grew out of the work that Salamon and his colleagues at Hopkins and around the world have done over the past 10 years to document the size and scope of the nonprofit sector. What they found was that the nonprofit or voluntary sector employs more people than the largest private firms in countries throughout the world and has a major impact on economies, accounting for anywhere from 8 percent to 12 percent of national employment in many countries, among them the Netherlands, Ireland, Belgium and the United States. What is more, this sector is growing rapidly.
But in the U.N.'s System of National Accounts, or SNA, which guides the gathering and reporting of economic information around the world, many nonprofit organizations are treated as part of the government or the corporate sector if they get substantial amounts of income from the public sector or service fees, respectively. For example, nonprofit universities and hospitals that rely largely on fees are listed as corporations, Salamon noted.
Using the new reporting tools outlined in the handbook, countries can better define, in a satellite account of the SNA, the size, scope and activities of their nonprofit sector, which Salamon and others believe is important to understanding and supporting this important set of institutions. "Nonprofits are coming to be understood as crucial parts of a healthy democracy and society," Salamon said, "and it is imperative that we have a better base of information on them."
In Canada, the prime minister recently announced a landmark accord with the voluntary sector in that country that includes funding the use of the handbook to create a Satellite Account of Nonprofit Institutions.
"It's a tool for the countries themselves, as well as a tool for the international community," said Cristina Hannig, chief of the economic statistics branch of the U.N. Statistics Division, who worked with Hopkins researchers on the handbook. "As globalization becomes stronger and stronger, it's in the interest of the countries to have data that is comparable to other countries'."
Salamon said the handbook has been in development for several years and was tested by Australia, Belgium, Canada, Israel, Italy, Mozambique, the Netherlands, the Philippines, South Africa, Sweden and Thailand. A number of countries already have begun using the handbook to collect data on nonprofits and to create reports, but Salamon said it will take time for the rest of the world to adopt the new procedures, especially since doing so may require resources.
But he's confident nations will see the value of accurate, and comparable, data about their nonprofit sectors and will move in that direction. "It will take three to five years to get a significant number of countries to do this," Salamon said. "The amazing thing is, a number of countries have already begun."