Determinants and Consequences of Nonprofit Transparency Article

Harris, EE, Neely, D. (2021). Determinants and Consequences of Nonprofit Transparency . JOURNAL OF ACCOUNTING AUDITING AND FINANCE, 36(1), 195-220. 10.1177/0148558X18814134

cited authors

  • Harris, EE; Neely, D

authors

abstract

  • Using a sample of over 14,000 industry-diverse nonprofit organizations, this study documents the key characteristics and consequences of organizations providing better and more information to stakeholders, that is, more transparent charities. In particular, we find evidence consistent with organizations that have stronger governance, better performance, and more professional staff being associated with greater transparency. In addition, we find that organizations that are more reliant on contributions, and those located in states that require public disclosure of their audited financial statements are also more transparent. After controlling for the likelihood of being transparent, we then test whether funders respond to more transparency by increasing their funding to organizations that provide more information. Here, we hypothesize and find that the level of transparency is associated with greater future contributions. Moreover, we find that organizations with better performance to report accrue incrementally more future contributions. Overall, our results support the assertion that transparency in the nonprofit sector is value added to key stakeholders.

publication date

  • January 1, 2021

Digital Object Identifier (DOI)

start page

  • 195

end page

  • 220

volume

  • 36

issue

  • 1