Efficiency and Not-For-Profits

In a speech to leaders of a Catholic charitable organization, Pope Francis reminded the audience to avoid “efficiency-ism” as well as “worshiping ourselves and our goodness.”  “People before programs!” the Pope added.

What Francis meant to convey about this subject is difficult to discern, as the speech had little operational specifics. It is sometimes difficult to understand Vatican-speak, and this is not an exception. For instance, Francis went on to say Jesus did not give clear instructions, resulting in some consternation with his followers. Hopefully the meaning of his guidance for charitable organizations will eventually unfold.  A military or business leader will tell you the lack of clear and specific instructions can cause all sorts of issues in their organizations. The Pope will quickly counter a charity is not a business and should operate differently than a business.

Francis is correct in many of his comments.  For instance, we have all met charitable organization or state employees that believed they were “on a mission.”  They were convinced of the correctness of their cause and brooked no discussion.  All NFP or governmental employees need to keep in mind they are there to help and not run the lives of their clients. The “efficiency-ism” the Pope is speaking off is the over bureaucratization and lack of human compassion we sometimes see in our world. 

Some of the other papal comments deserve closer scrutiny. “People before Programs!” is a populist slogan sounding good to everyone.  If the Pope means programs should be run for the good of the people without enough accountability and oversight, then he should reconsider this sentiment.   In church chanceries and parish centers, “efficiency-ism” often becomes a synonym for the lack of accountability.  An organization devoid of any efficiency will be devastated in short order.  Even large organizations seemingly impervious to economic consequences fail in their mission if there is an extreme waste.  As a diocesan finance officer, I saw the awful waste the lack of internal controls can do to the funds of a Catholic diocese or parish. So much more could have been given to the needy if there has been but rudimentary controls, program efficiency and accountability.

The Pope is correct that an NFP is not a for profit business and shouldn’t be run like a for profit business.  Yet, there are aspects of a business such as efficiency and internal controls any NFP should be willing to adopt.  Perhaps the Pope was stretching a point (or alternatively, I am!) in his speech. In the end, I would have been much happier if Francis had used the Aristotelian Golden Mean to describe the efficiency and controls needed over any NFP.    Aristotle claimed the ethical behavior was the mean between the two extremes, one being an excess and the other being a deficiency.  In this case, “efficiency-ism” is the excess and no efficiency is the deficient condition. His guidance and intent would have become more actionable. If the Pope is not comfortable with using philosophy as an ethical guideline, he might find the Parable of the Talents in Matthew 25 more appealing. 

Sources (Accessed May 20, 2019):

Pope warns charity leaders to steer clear of ‘efficiency-ism’


Gospel of Matthew. Revised Standard Version. 1977 by Oxford Press.  The Parable of the Talents is a multifaceted story that can be interpreted in many ways. Two of the three servants who wisely invested their master’s money were rewarded.  This parable has been quoted often to describe the duty of good stewardship of church assets.