1. The status of the Romanian nonprofit sector and its readiness for social entrepreneurship
Claudia Petrescu, Marton Balogh,
Natalia Monica Balogh, Paula Beudean
Claudia Petrescu

2. Historical background
Prior to WWII: charities
December 1989: Number nonprofit organizations: zero
2010: Over 62,000 registered nonprofits. 21,000 active.
2015: 90,000 registered nonprofits with one-third active
(Romanian National Nonprofit Organizations Register, October 10, 2015).

3. The Environment
After the fall of Communism (1989): No nonprofit knowledge, No community engagement or volunteering culture; No funding mechanism
Starting with 1990
Import of nonprofit knowledge
International Nonprofits and Foundations
(Re)creation of organizations that existed prior to WWII
Creation and Development of the sector with external funding
10-15 years later: withdrawal of external funding
Present Funding Sources: Romanian state and local governments, EU institutions, Foundations established in Romania or external Foundations

4. Research Objectives
Assess the organizational capacity of Romanian nonprofit organizations for growth and development
To understand Romanian nonprofit organizations’ potential for social innovation, respectively if they have the organizational capacity to :
understand social needs
find new and effective ways to address them
To understand the strengths and weaknesses of nonprofits’ capacity from the perspective of social enterprise, respectively if and how they use and apply business practices

5. Methodology
Capacity building assessment instrument created and tested as part of a Capacity Building grant (Petrescu and Clifford, )
Interview with nonprofit executives in Cluj-Napoca, Romania to adapt the instrument (Summer 2014)
Develop and pre-test the survey. Administer the survey via Survey Monkey
Administer the survey to 55 top level managers in selected organizations (June-October 2015) (Main criteria: active)
Responses: 33.
Return rate: 66%

6. Characteristics of respondents
Age: 8 (25%) were established right after the revolution ( ), 17 (53%) between , and 6 (19%) since One: 1924 Staff size: 5 (17%) with no staff, 12 (41%) with less than 10 staff members, 6 (21%) with staff members, 5 (17%) with staff members, one with over 50 staff members Board: 12 organizations (41%): Less than 5 members; 16 organizations (55%): 5-8 members, One organization has more than 8 members N=29

7. Characteristics of respondents (2)
Volunteers: (n=27): 17 organizations (63%) have less than 25 volunteers; 2 (7%) between 26-49; 2 (7%) between 5-100; 6 (22%) over 100 Budget: 10 organizations with budgets of approximately under 1 million lei ($242,000), 12 organizations with budgets between 1 million and 10 million let ($2.4 million); 2 organizations with budgets over $2.4 million Location: From all parts of Romania, but the Nord-Western and Central Regions are better represented, as in these regions (beside Bucharest, the capital) have a higher density of nonprofit organizations

8. Organizational capacity of Romanian nonprofits for growth and development
Budget trends (N=29) in the past five years
24 organizations (89%): increasing.
Three (10%): decreased budgets
Two organizations: did not know
Funding sources (N=29)
19 organizations (66%) have a diversity of sources.
These sources can be: external to the country, private sector, state and local government, a combination of private and public, donations.
10 organizations (25%) rely on one source

10. Nonprofit Sector’s Potential for Social Innovation

12. Nonprofit Sector’s Capacity for Social Enterprise

13. Performance level (% respondents)
Strategic decisions: Organizational Practices and the level of performance N
Performance level (% respondents)
We do this very well
We should do this better
We don't do it but we should
Take into consideration the org mission 26 69 23
Take into consideration past performances 54 39 8
Take into consideration outcomes of program evaluation 19 50 27
Based on information provided by board, volunteers and employees
Take into consideration socio,econ,techical and legal factors 62 12
Take into consideration financial trends and situation 58
Include long and short term objectives 35
ED evaluates on a regular basis the achievement of the SP goals 25 72
Job Descriptions are updated on a regular basis 32 44 20
Staff seeks public and private funding sources 40 48
Org has an efficient system for monitoring grants administration 56 36
Org creates partnerships with private sector for resource diversification 24 38
Org partners with other organizations on projects 67

14. Summary of the exploratory study
Complements present studies of the Romanian sector
We found elements of strategic management:
organizations are seeking to understand community needs,
collect information from their stakeholders to understand the type of services they need to provide or develop
analyze the external environments
strategic decisions are being made by seeking funding through partnerships
This study contradicts previous studies (Bibu&Lisetchi, 2011; FDSC & USAID2014 )
The finding that a large majority of our respondents use strategic planning
Good budgeting practices

15. Summary of the exploratory study (2)
Difference between our study and previous studies:
previous studies did not look at all to how the organizations prepare for entrepreneurial activities.
They only measured the value of the income-generating activities of the sector, and surveyed the interest of NGOs in social entrepreneurship.
The young Romanian nonprofit sector is developing its management practices, is learning and on its way to adopt best practices developed by mature organizations.

16. Questions and Comments?