Analysis of Determinants of Revenue Sources for International NGOs

Abstract

Securing financial sustainability through fundraising and other forms of financing is a critical issue for many nonprofit organizations. This article extends the benefits theory by adding beneficiary and organizational characteristics to it and examines how these characteristics affect revenue source composition. Based on a survey of International Nongovernmental Organizations (INGOs) with headquarters in Switzerland, the results quantitatively demonstrate a predictive relationship between programmatic and financial management: First, Swiss-based INGOs’ revenue sources rely heavily on income-generating revenue sources. Second, the efficacy of the benefits theory of nonprofit finance is demonstrated outside of the organizational context of U.S. local/national nonprofits. Third, INGOs’ organizational and beneficiary characteristics influence their revenue source composition. Fourth, the results demonstrate clear differences between revenue sources. Fifth, overall, the beneficiary field is the most influential of the proven characteristics in determining revenue source percentages.