MEASURING GOVERNANCE OF NONPROFIT ORGANIZATIONS: GOVERNANCE INDEX PROPOSAL

Authors

  • Adonai Lacruz Instituto Federal do Espírito Santo - campus Viana
  • Valcemiro Nossa Fucape Business School
  • Katarina Rosa Lemos Instituto Federal do Espírito Santo
  • Thiago de Andrade Guedes Instituto Federal do Espírito Santo

DOI:

https://doi.org/10.22561/cvr.v32i3.6661

Keywords:

governance, governance index, third sector, nonprofit organizations

Abstract

The objective is to propose a Governance Index for the Third Sector (IGov3S) that expresses the governance profile of Nonprofit Organizations (NPOs). Data was collected through a documentary survey, and the sample consisted of 108 NPOs from the environmental sector operating in Brazil. The data was analyzed by multiple correspondence analysis (IGov3S dimensions and weights), cluster analysis (identification of IGov3S levels), and variance analysis with Hochberg post-hoc test (IGov3S validation).  Six governance dimensions were identified from these analyses, from which the IGov3S was developed. Then, four distinct governance profiles were calculated, resulting in the quality classification of the IGov3S at four levels. The results of this research can contribute to researchers interested in this theme that can avail themselves of a measure composed of governance in the nonprofit sector either as a dependent, independent, or control variable in their empirical models, bypassing methodological restrictions resulting from the correlation between indicators generally used as a proxy for measuring governance.

Author Biographies

Adonai Lacruz, Instituto Federal do Espírito Santo - campus Viana

Doutor em Administração pela Universidade Federal do Espírito Santo (UFES). Professor no Instituto Federal do Espírito Santo (Ifes) campus Viana e no Programa de Pós-Graduação em Administração da Universidade Federal do Espírito Santo (UFES).

Valcemiro Nossa, Fucape Business School

Doutor em Controladoria e Contabilidade pela Universidade de São Paulo (USP). Professor na FUCAPE Business School.

Katarina Rosa Lemos, Instituto Federal do Espírito Santo

Graduada em logística pelo Instituto Federal do Espírito Santo (Ifes).

Thiago de Andrade Guedes, Instituto Federal do Espírito Santo

Mestrando em Administração pela Universidade Federal do Espírito Santo (UFES).

References

Antonakis, J., Bendahan, S., Jacquart, P., & Lalive, R. (2010). On making causal claims: a review and recommendations. The Leadership Quarterly, 21(6), 1086-1120. DOI: https://doi.org/10.1016/j.leaqua.2010.10.010

Australian Council for Overseas Aid. (2002). Code of conduct for non-government development organizations. Author.

Australian Institute f Company Directors. (2013). Good governance principles and guidance for not-for-profit organizations. Author.

Ávila, L. A. C., & Bertero, C. O. (2016). Governança no terceiro setor: um estudo de caso em uma fundação de apoio universitário. Revista Brasileira de Gestão de Negócios, 18(59), 125-144. DOI: https://doi.org/10.7819/rbgn.v18i59.2107

Balsam, S., Harris, E. E., & Saxton, G. D. (2020). The use and consequences of perquisite types in nonprofit organizations. Journal of accounting and public policy, 39(4), 1-19. DOI: https://doi.org/10.1016/j.jaccpubpol.2020.106737

Blouin, M. C., Lee, R. L., & Erickson, G. S.(2018). The impact of online financial disclosure and donations in nonprofits. Journal of Nonprofit & Public Sector Marketing, 30(3), 252-266. DOI: https://doi.org/10.1080/10495142.2018.1452819

Boland, C. M., Harris, E., Petrovits, C., & Yetman, M. (2020). Controlling for corporate governance in nonprofit research. Journal of Governmental & Nonprofit Accounting, 9(1), 1-44. DOI: https://doi.org/10.2308/JOGNA-17-017

Bortolon, P. M., Silva, L. S., & Barros, L. A. B. C. (2019). Ativismo e solicitação de instalação do Conselho Fiscal: influência do monitoramento, desempenho e estrutura de propriedade. Revista Contabilidade, Gestão e Governança, 22(2), 216-279. DOI: https://doi.org/10.21714/1984-3925_2019v22n2a7

Cabedo, J. D., Fuertes-Fuertes, I., Maset-Llaudes, A., & Tirado-Beltrán, J. M. (2018). Improving and measuring transparency in NGOs: a disclosure index for activities and projects. Nonprofit Management & Leadership, 28(3), 329-348. DOI: https://doi.org/10.1002/nml.21298

Cattell, R. B. (1966). The scree test for the number of factors. Multivariate Behavioral Research, 1(1), 245-276. DOI: https://doi.org/10.1207/s15327906mbr0102_10

Conselho Nacional do Meio Ambiente. (2016). Cadastro nacional de entidades ambientalistas. Recuperado de http://www.mma.gov.br/port/conama.

Correia, L. F., Amaral, H. F., & Louvet, P. (2011). Um índice de avaliação da qualidade da governança corporativa no Brasil. Revista Contabilidade & Finanças, 22(55), 45-63. DOI: https://doi.org/10.1590/S1519-70772011000100004

Desai, M. A., & Yetman, R. J. (2015). Constraining Managers without Owners: Governance of the Not-for-Profit Enterprise. Journal of Governmental & Nonprofit Accounting, 4(1), 53-72. DOI: https://doi.org/10.2308/ogna-51138

Dumont, G. E. Nonprofit virtual accountability: na index and its application. (2013). Nonprofit and Voluntary Sector Quarterly, 42(5), 1049-1067. DOI: https://doi.org/10.1177/0899764013481285

Fama, E. F., & Jensen, M. C. (1983). Separation of Ownership and Control Separation of Ownership and Control. Journal of Law and Economics, 26(2), 301-325. DOI: https://doi.org/10.1086/467037

Financial Reporting Council. (2016). The UK corporate governance code. Author.

Fredette, C., & Bradshaw, P. (2012). Social capital and nonprofit governance effectiveness. Nonprofit Management & Leadership, 4(2), 391-409. DOI: https://doi.org/10.1002/nml.21037

Gujarati, D. N. (2000). Econometria básica. Makron Books.

Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (009). Analise multivariada de dados. Bookman.

Hair, J. F., Ringle, C. M., Cheah, J.-H., Ting, H., Moisescu, O. I., & Radomir, L. Structural model robustness checks in PLS-SEM. (2020). Tourism Economics, 26(4), 531-554. DOI: https://doi.org/10.1177/1354816618823921

Harris, E., Petrovits, C. M., & Yetman, M. H. (2015). The effect of nonprofit governance on donations: evidence from the revised form 990. The Accounting Review, 90(2), 579-610. DOI: https://doi.org/10.2308/accr-50874

Harris, E., Petrovits, C., & Yetman, M. H. (2017). Why bad things happen to good organizations: the link between governance and asset diversions in public charities. Journal of Business Ethics, 146(1), 149-166. DOI: https://doi.org/10.1007/s10551-015-2921-9

Hasnan, S., Mohamad, M., Zainuddin, Z. N., & Abidin, Z. Z. (2016). Corporate governance factors affecting donation: evidence from charitable organizations in Malaysia. International Journal of Economics and Financial Issues, 6(Special Issue), 149-153.

Hedge, K. K., Nico, E., & Fox, L. (2009). Advancing good governance: how grantmakers invest in the governance of nonprofit organizations. BoardSource.

Hosmer, D. W., & Lemesshow, S. (2000). Applied logistic regression. Wiley. DOI: https://doi.org/10.1002/0471722146

Horn, J. L. (1965). A rationale and technique for estimating the number of factors in factor analysis. Psychometrika, 30(1), 179-185. DOI: https://doi.org/10.1007/BF02289447

Instituto Brasileiro de Geografia e Estatística. (2012). As fundações privadas e associações sem fins lucrativos no Brasil. Autor.

Instituto Brasileiro de Governança Corporativa. (2009). Código das melhores práticas de governança para fundações e institutos empresariais. Autor.

Instituto Brasileiro de Governança Corporativa. (2015). Código de melhores práticas de governança corporativa. Autor.

Instituto Brasileiro de Governança Corporativa. (2016). Guia das Melhores Práticas para organizações do terceiro setor: associações e fundações. Autor.

Instituto de Pesquisas Econômicas Aplicadas (2018). Perfil das organizações da sociedade civil no Brasil. Autor.

Jensen, M. C. (1993). The modern industrial revolution , exit , and the failure of internal control systems. Journal of Finance, 48(3), 831-880. DOI: https://doi.org/10.1111/j.1540-6261.1993.tb04022.x

Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360. DOI: https://doi.org/10.1016/0304-405X(76)90026-X

Jensen, M. C., & Meckling, W. H. (1995). Specific and general knowledge and organizational structure. Journal of Applied Corporate Finance, 8(2), 251-274. DOI: https://doi.org/10.1111/j.1745-6622.1995.tb00283.x

Kitching, K. (2009). Audit value and charitable organizations. Journal of Accounting and Public Policy, 28(6), 510-524. DOI: https://doi.org/10.1016/j.jaccpubpol.2009.08.005

Lacruz, A. J. (2020). Considerações teóricas sobre governança corporativa no terceiro setor à luz da teoria da agência. Cadernos EBAPE.BR, 18(3), 473-485. DOI: https://doi.org/10.1590/1679-395120190007

Lacruz, A. J., Moura, R. L., & Rosa, A. R. (2019). Organizing in the shadow of donors: how donations market regulates the governance practices of sponsored projects in non-governmental organizations. Brazilian Administration Review, 16(3), 1-23. DOI: https://doi.org/10.1590/1807-7692bar2019180111

Lee, J. E., & Choi, A. (2019). The effects of financial reporting transparency and high-quality audit on donations to non-profit organizations: evidence from Korean charitable organizations. Journal of the Korea Convergence Society, 10(11), 227-238. DOI: https://doi.org/10.15207/JKCS.2019.10.1.227

Lin, Z., & Li, Y. (2020). Examining the relationship between different types of information disclosure of foundations and chinese donations. Nonprofit Policy Forum, 11(3), 1-21. DOI: https://doi.org/10.1515/npf-2019-0035

Marques, B. A., Rody, P. H. A., Campos, G. M., & Reina, D. (2015). Terceiro setor: panorama das tendências de 1998 a 2013 por meio de um estudo bibliométrico. Enfoque: Reflexão Contábil, 34(2), 71-89. DOI: https://doi.org/10.4025/enfoque.v34i2.23439

Maryland Association of Nonprofit Organizations. (2004). Standards for excellence: an ethics and accountability code for the nonprofit sector. Author.

Miles, J., & Shevlin, M. (2001). Applying regression and correlation: a guide for students and researches. Sage.

Minnesota Council of Nonprofit. (2014). Principles and practices for nonprofit excellence. Author.

Oliveira, A. G. de., & Pisa, B. J. (2015). IGovP: índice de avaliação da governança pública - instrumento de planejamento do Estado e de controle social pelo cidadão. Revista de Administração Pública, 49(5), 1263-1290. DOI: https://doi.org/10.1590/0034-7612136179

Petrovits, C., Shakespeare, C., & Shih, A. (2011). The causes and consequences of internal control problems in nonprofit organizations. The Accounting Review 86 (1), 325-357. DOI: https://doi.org/10.2308/accr.00000012

R Core Team. (2019). R: A language and environment for statistical computing. Vienna: R Foundation for Statistical Computing. Recuperado de https://www.r-project.org/

Renz, D. O., & Andersson, F. O. (2014). Nonprofit governance: a review of the field. In C. Cornforth & W. A. Brown (Eds.), Nonprofit governance: innovative perspectives and approaches (pp. 17-46). Routledge.

Salamon, L. M. (1997). Holding the center: america's nonprofit sector at a crossroads. Foundation Center.

Saxton, G. D., Neely, D. G., & Guo, C. (2014). Web disclosure and the market for charitable contributions. Journal of Accounting and Public Policy, 33(2), 127-144. DOI: https://doi.org/10.1016/j.jaccpubpol.2013.12.003

Silveira, A. Di M. da. (2010). Governança corporativa no Brasil e no mundo. Elsevier.

Silveira, A. Di M. da, Perobelli, F. F. C., & Barros, L. A. B. C. (2008). Governança corporativa e os determinantes da estrutura de capital: evidências empíricas no Brasil. Revista de Administração Contemporânea, 12(3), 763-788. DOI: https://doi.org/10.1590/S1415-65552008000300008

Willems, J., Huybrechts, G., Jegers, M., Weijters, B., Vantilborgh. T., Bidee, J., & Pepermans, R. (2012). Nonprofit governance quality: concept and measurement. Journal of Social Service Research, 38(4), 561-578. DOI: https://doi.org/10.1080/01488376.2012.703578

World Association of non-governmental organizations. (2004). The code of ethics and conduct for NGO's. Author.

Yetman, M. H., & Yetman, R. J. (2012). The effects of governance on the accuracy of charitable expenses reported by nonprofit organizations. Contemporary Accounting Research, 29(3), 738-767. DOI: https://doi.org/10.1111/j.1911-3846.2011.01121.x

Published

2021-12-10

How to Cite

LACRUZ, A.; NOSSA, V.; ROSA LEMOS, K.; DE ANDRADE GUEDES, T. MEASURING GOVERNANCE OF NONPROFIT ORGANIZATIONS: GOVERNANCE INDEX PROPOSAL. Contabilidade Vista & Revista, [S. l.], v. 32, n. 3, p. 98–122, 2021. DOI: 10.22561/cvr.v32i3.6661. Disponível em: https://revistas.face.ufmg.br/index.php/contabilidadevistaerevista/article/view/6661. Acesso em: 25 nov. 2024.