- Title
- An alternative model for the financial sustainability of social services sector NGOs in the Eastern Cape, South Africa
- Creator
- Kagande, Albert Tafadzwa
- Subject
- Non-governmental organizations -- South Africa
- Subject
- Accounting -- Social aspects
- Subject
- Sustainability
- Date Issued
- 2023-12
- Date
- 2023-12
- Type
- Doctoral theses
- Type
- text
- Identifier
- http://hdl.handle.net/10948/65644
- Identifier
- vital:74217
- Description
- The work of Non-Governmental Organisations (NGOs) is traditionally deemed “unprofitable”, yet they provide valuable services to communities. With an exponentially growing NGO sector of more than 270 000 NGOs, of which 40% are social service sector NGOs, and an increased demand for NGO services, a decrease in government and donor funding has heightened the debate on the need for financial sustainability of NGOs in South Africa. NGOs are important development actors, and their financial sustainability is crucial as it ensures that the sector continues to be relevant and effective in ensuring that social needs are met. Using a mixed methods sequential explanatory research design, the study focused on the social services sector NGOs in the Eastern Cape with the aim of understanding their financial challenges and strategies being employed to address such and, in the process, develop an alternative model for the financial sustainability of these NGOs. A conceptual framework was developed from six theories which were used to explore the concept of financial sustainability drawing insights from the internal and external environment of the participating NGOs. These theories were used together to emphasise that no one theory could single-handedly and holistically explain the concept of the financial sustainability of social service sector NGOs. The use of multiple theories also came from the realisation that NGOs in South Africa, in general, are struggling to survive owing to a myriad of factors which include increased competition for resources and reduced funding from their traditional source. Furthermore, donor dependency, staff and organisational capacity, management practices and values, and the interplay of an NGO with its stakeholders and environment all have a bearing on financial sustainability. Being the poorest province in South Africa heightens the need for social services in the Eastern Cape. From the study, it was established that 48% of social services sector NGOs depended on government funding while only 16% had the capacity to generate their own income. However, depending on government funding was not sustainable and this was crippling the social services sector. The study also established that “young” NGOs struggled to secure funding when compared to their “mature” counterparts. In addition, staff capacity and the values of an organisation affected income generation and how funds were sourced. Lack of capacity to fundraise and/or implement commercial activities had affected the financial sustainability of the social sector NGOs. The interplay of an NGO and its stakeholders and environment also had a bearing on the financial sustainability of the sector. The study provides a multipronged approach and perspective to financial sustainability. The proposed financial sustainability model challenges social services sector NGOs to consciously reflect on their internal and external environments as well a come up with strategies that positively affect their financial sustainability. From the study, the strategies that were being implemented to realise financially sustainability included, retaining current donors, reaching out to new donors, innovative fundraising approaches, redesigning programme activities to include cost-recovery components, collaborating with other NGOs as well as commercial ventures. This study concludes that social services sector NGOs need all these approaches in addition to improving staff capacity and adopting a culture that enhances organisational performance. There is need to build a system where NGOs are adequately supported to do their work without worrying about income and where well-designed financial sustainability components help NGOs, funders, government and communities identify where change is needed.
- Description
- Thesis (DPhil) -- Faculty of Business and Economic Sciences, School of Economics, Development and Tourism, 2023
- Format
- computer
- Format
- online resource
- Format
- application/pdf
- Format
- 1 online resource (iv, 480 pages)
- Format
- Publisher
- Nelson Mandela University
- Publisher
- Faculty of Business and Economic Sciences
- Language
- English
- Rights
- Nelson Mandela University
- Rights
- All Rights Reserved
- Rights
- Open Access
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- Visitors: 15
- Downloads: 9
Collections
NMU School for Economics, Development and Tourism
| Thumbnail | File | Description | Size | Format | |||
|---|---|---|---|---|---|---|---|
| View Details Download | SOURCE1 | Kagande, A.pdf | 5 MB | Adobe Acrobat PDF | View Details Download |