A Dictionary of Civil Society, Philanthropy and the Third Sector

This guide to civil society provides a quick and easy reference to the key people, concepts and organizations of the third sector. It contains approximately
Table of contents

In Search of the Third Sector

At a minimum, it embraces cooperatives, mutual societies, social enterprises, and direct volunteering. And these entities and activities have also, like NPIs, been invisible in regular economic statistics even though data on them is included. For NPIs, this was relatively easy since the prohibition on the distribution of profit to owners or directors under which NPIs operate in most countries provides strong evidence that, unlike profit-making companies, they primarily serve a broader public purpose since they cannot serve the financial interest of a set of owners or investors.

Cooperatives, mutuals, and social enterprises, however, do not operate under a strict prohibition on their distribution of profits to owners or other stakeholder and are consequently harder for statisticians to distinguish from plain-vanilla for-profit firms.

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Indeed, many of them are huge commercial and financial enterprises that operate virtually indistinguishably from for-profit enterprises in their same fields. Armed with this conceptualization, researchers in the Third Sector Project have fanned out to statistical authorities in their respective countries and at the European level to encourage implementation of this new statistical machinery for capturing NPIs, volunteer work, and, eventually, the full TSE sector in the official statistical systems of Europe.

To date, 10 European countries have at least begun to implement some element of this new statistical machinery for capturing the TSE sector in official statistics. Although there is not yet any shared approach to measurement of the third sector in the EU, could you give examples of what the third sector represents in terms of activities and jobs for instance in a couple of representative States in the EU.

We have fairly robust data on NPIs and on volunteer work for a number of EU countries from which we can make reasonable estimates for the EU as a whole. This makes it the third largest workforce of any industry in the entire EU, behind only the combination of trade, transport, accommodation, and food service, almost even with manufacturing, and twice as large as construction. And this is even after taking out the large commercial cooperatives and mutual societies that likely lack the significant limitations on their distribution of profit that is central to our conceptualisation. In some countries, such as the Netherlands, the Third Sector engages more full-time equivalent workers, paid and volunteer, than any other industry, beating manufacturing by a factor of 3: Which organisational or environmental barriers impede and which solutions enable the third sector to have an impact.

While this work is far from complete, a number of themes are apparent. For one thing, many parts of the sector remain poorly paid and under stress, and this is particularly so in the new accession states. Although the sector mobilises a substantial labor force, 60 percent of these are volunteers, and many of the others are not paid well. What is more, the sector is in the midst of a generational change of leadership, and it is not clear whether young people will be as attracted to this sector as those who founded the organisations during the expansion period of the s and beyond.

This raises the important issue of human resource development and capacity-building for sector professionals and volunteers. Here Eurostat could play a far more proactive role in encouraging adoption of the new statistical machinery that has been created at the international level precisely to bring third sector institutions and volunteer effort into better focus. EU funding has been important to the fledgling third sector organisations in the accession countries, but more generally EU funding is too complicated and cumbersome for many organisations, particularly smaller organisations working at local level.

At a more general level, EU institutions could be much more helpful in recognising the absolutely crucial role that third sector institutions and the enormous volunteer effort they help to mobilise, contribute to the economic and social life of this community.

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Europe has perhaps the largest civil society sector in proportional terms than any other continent in the world, yet also does the least to recognize and celebrate its accomplishments and contributions. As you know, there is still a dominant economic thought that economic growth should prevail and that the citizens should for this accept all sorts of changes in our employment patterns, labour conditions, and even salary conditions. Does the third sector offer an example of more solidarity in a world of enhanced competition?

The third sector as we have defined it is distinguished by the fact that its institutions primarily serve the common good. Operationally, this is evident in the fact that they are prohibited from, or significantly limited in, distributing any profits they may earn to their directors, investors, managers, or other stakeholders. What motivates them is not the maximisation of profit but the maximisation of service to the individuals and communities they serve. In this sense, solidarity is ingrained in their DNA.

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4 editions of this work

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