December 12, 2014

Media release: Not-for-Profit sector must invest more in professional development

The not-for-profit (NFP) sector’s lack of investment in employee professional development is limiting staff capacity and calling the sector’s long-term viability into question, according to researchers at The University of Western Australia Business School’s Centre for Social Impact.

The Learning for Purpose: Social Return of Education and Training studyevaluated the impact of training and development activities in the Australian not-for-profit sector.

The study’s results, says lead researcher Dr Ramon Wenzel, confirm anecdotal evidence that not-for-profit organisations often prefer to put their limited resources into directly serving their clients rather than developing the capabilities of their employees, which is problematic.

“We found that organisations that prioritise employee development perform better overall, and in turn this contributes to the creation of social change.” Dr Wenzel said.

“However, findings suggest that only 58 per cent of NFP sector employees undertook professional development this year. Many staff and volunteers working in the NFP sector simply can’t afford training, or need support which they often can’t access.

“Our study found 33 per cent of senior NFP executives have no designated budget for their own professional development, while those in small NFP organisations often fund professional development through personal financial investment.

“This supports a recent Productivity Commission report on the Australian NFP sector which identified a lack of key competencies as a major limitation for the long-term viability of the Australian NFP sector.”

Early findings from the UWA study suggest NFP organisations can adapt to significant challenges through more engagement with both formal and informal work learning.

“Over the next several years our research will continue to investigate and value how training and development can improve the NFP sector’s ability to enable social change. Ultimately, we seek to improve the means through which individuals and organisations gain and sustain the key competencies needed,” said Dr Wenzel.

Sean Barrett, Head of the Origin Foundation, which is funding the study, said it is important all organisations, including NFPs, have the tools and empirical evidence to adapt and address societal needs.

“Gone are the days when the not-for-profit sector could explain itself by saying: ‘We are good people doing good work’. Today, more is expected of the sector,” Mr Barrett said.

“But while more is expected, this is not necessarily accompanied by more resources. This research has the potential to be a game changer by encouraging NFPs to increase their investment in training and development. But, perhaps more importantly, it will challenge funders who are traditionally reluctant to support so-called capacity building.”

With a value of around $58 billion – accounting for four per cent of Australia’s Gross Domestic Product – and employing over one million people, the Australian NFP sector has the potential to be an even greater contributor to driving social change, say researchers.

The Learning for Purpose: Social Return of Education and Training study was led by the UWA Business School’s Winthrop Professor Paul Flatau and supported by the Origin Foundation and Australian Scholarships Foundation.

Read more about the study here.

MEDIA REFERENCE

Verity Chia (UWA Business School) +61 8 6488 1346

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