Rethinking Nonprofit Commercialization: The Case of the Czech Republic

Abstract

Some nonprofit economists tend to see nonprofit commercialization as a moral dilemma because commercial activities may secure organizational survival at the cost of undermining the mission orientation. The present paper argues that this type of moral framing of the commercialization debate is hardly adequate for the transitional context of the Czech nonprofit sector which is still struggling to develop its distinct institutional identity. Given that financial independence is part of this identity, commercial activities help nonprofits to emancipate themselves from the state that used to be paternalistic in the past. On this basis, the paper underscores the institutional nature of the commercialization phenomenon in the Czech Republic. Commercialization decisions of Czech nonprofit managers are shown to be heavily influenced by the current institutional and regulatory environment that explicitly promotes nonprofit self-financing initiatives. If nonprofit commercialization is understood as an institutional phenomenon, then its moral significance is best captured in terms of institutional ethics rather than individual ethics of nonprofit managers which seems to be predominant in the Anglo-Saxon literature. After presenting the recent empirical findings on self-financing, the paper concludes by stressing the interrelation between the semantic and ethical aspects of the commercialization concept.