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Accountability in French non-profit organizations: between paradox and complexity

May 2024
Journal of Applied Accounting Research 25(3):420-447

DOI:10.1108/JAAR-01-2023-0006

Authors:

University of Bordeaux

This article examines whether accountability can contribute to the analysis of effectiveness in grassroots voluntary organizations (GVOs) in France. Based on recent studies and stakeholder theory, hypotheses are formulated about the negative link between accountability and financial effectiveness and a positive link between accountability and non-financial effectiveness. The findings show that accountability practices are positive determinants of financial indicators (apart from ROA) and employment of people in difficulty. In contrast, the other non-financial indicators are not explained by accountability practices. The study points out the complexity and paradoxes surrounding accountability and highlights the risk of insensitivity to it. It thus underlines a specific French situation, close to the risks of myopia linked to accountability. One possible explanation could be the coupling and decoupling mechanisms that allow NPOs to regain power. Given the sometimes-random effects of accountability, producing nuanced theories is necessary and governance should oscillate between equilibrium and adaptation in the face of stakeholders. Finally, this article introduces the risk of insensitivity of NPOs to accountability (i.e. they act as they wish, regardless of control mechanisms such as accountability). This study thus reveals governance dilemmas, which could be solved through less formal, more mission-oriented, more creative and therefore heterodox accountability. The French context of mistrust of certain managerial approaches and the development of codes of governance based on a disciplinary vision are confronted with a growing and critical literature on accountability in nonprofit organizations (NPOs).

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Accountability in French non-profit organizations: between

paradox and complexity

Guillaume Plaisance

Research Institute in Management Science (Univ. Bordeaux, IRGO, EA 4190)

Bordeaux University, Bordeaux, France

Article published in the Journal of Applied Accounting Research

DOI: 10.1108/JAAR-01-2023-0006

Accepted for publication on 23-Jun-2023

Creative Commons Attribution Non-commercial International Licence 4.0

(CC BY-NC 4.0).

Abstract

Purpose: This article examines whether accountability can contribute to the analysis of

effectiveness in grassroots voluntary organizations (GVOs) in France.

Originality: The French context of mistrust of certain managerial approaches and the

development of codes of governance based on a disciplinary vision are confronted with a

growing and critical literature on accountability in non-profit organizations (NPOs).

Design/methodology/approach: Based on recent studies and stakeholder theory,

hypotheses are formulated about the negative link between accountability and financial

effectiveness and a positive link between accountability and non-financial effectiveness.

Findings: The findings show that accountability practices are positive determinants of

financial indicators (apart from ROA) and employment of people in difficulty. In contrast,

the other non-financial indicators are not explained by accountability practices.

Research limitations/implications: The study points out the complexity and paradoxes

surrounding accountability and highlights the risk of insensitivity to it. It thus underlines

a specific French situation, close to the risks of myopia linked to accountability. One

possible explanation could be the coupling and decoupling mechanisms that allow NPOs

to regain power. Given the sometimes-random effects of accountability, producing

nuanced theories is necessary and governance should oscillate between equilibrium and

adaptation in the face of stakeholders. Finally, this article introduces the risk of

insensitivity of NPOs to accountability (i.e. they act as they wish, regardless of control

mechanisms such as accountability).

Practical implications: This study thus reveals governance dilemmas, which could be

solved through less formal, more mission-oriented, more creative and therefore heterodox

accountability.

Keywords: governance – effectiveness – accountability – stakeholder theory – French

nonprofit organizations

Funding: The author was supported by a thesis scholarship from the French Department

of Research.

Conflict of Interest: No potential conflict of interest was reported by the author.

Availability of data and material: Raw data were generated by IDEAS. Derived data

supporting the findings of this study are available from the author on request.

Acknowledgements: The author would like to thank Pascal Barneto and Elisabeth

Bertin, his supervisors, for their support and Alpa Dhanani and Ciaran Connolly for their

advice and for agreeing to forward their checklist tool.

1. Introduction

The Covid-19 crisis has considerably affected the survival and the effectiveness

of non-profit organizations (NPOs), but in fact, NPOs have been under pressure for a long

time. These organizations’ growing political, social and economic position in society is

accompanied by increasing stakeholder requirements (Costa and Goulart da Silva, 2019).

Little by little, stakeholders are asking for more and more before they agree to allocate

resources to NPOs. They no longer trust or believe NPOs (Greiling and Stötzer, 2016)

and ask for proof in order to assess NPOs’ outcomes and performance (Mitchell and

Berlan, 2018).

NPOs are therefore in a constant search for legitimacy (Yasmin and Ghafran,

2021) and the non-profit literature associates this concept with accountability. It can

indeed be defined as the “liability for ensuring a task is satisfactorily done” (McGrath and

Whitty, 2018, p. 702). However, the literature on accountability in non-governmental

organizations (NGOs) and national forms of NPOs is still “embryonic” (Yasmin and

Ghafran, 2019, p. 3). Renz, Brown and Andersson (2023) also point to the lack of research

dedicated to NPOs’ accountability but also of a critical approach on the associated issues.

Until now, the results are rather contrasted and mainly focused on the financial

effects of accountability. It was this finding that led Yasmin and Ghafran (2019) to

describe accountability as a potentially “problematic” process. The use of accountability

is therefore sometimes questioned or even limited in some countries. One example could

be the French case (Plaisance, 2023).

The French NPO sector is marked by a historic scandal that has disrupted their

management. In 1996, an audit by the public authorities of the Association for Cancer

Research revealed that only a quarter of the money collected actually financed medical

research. Since then, governance and control principles have been developed to counter

the problem. Despite this scandal, governance and accountability remain concepts that

NPOs are wary of. NPO federations (e.g. Le Mouvement Associatif) question their

relevance and adaptation to French NPOs (CPCA, 2012).

This mistrust can be explained by the underlying theoretical vision in France.

Even governance codes are rooted in disciplinary approaches, even though NPOs do not

have owners in the shareholder sense. Furthermore, the recent literature constantly

emphasizes the importance of opening up to other theoretical currents when studying

organizations in general (Hitt et al., 2021), and NPO accountability in particular (Pilon

and Brouard, 2022).

This article therefore proposes to confront recent critical studies, which remains

sceptical about the development of disciplinary accountability, with the French non-profit

governance codes that defend this approach to improve organizational effectiveness. In

this, the research question is:

RQ: To what extent do French NPOs adopting good accountability practices see

their effectiveness improve?

This study is based on an analysis of French NPOs’ reports, of their financial

health and of their social and environmental practices. It participates in the reflection on

the link between accountability and overall effectiveness, one of the main challenges of

the accountability literature. The literature on the subject is still emerging and is polemical

in questioning the relevance of accountability. A gap is particularly open in non-profit

research because it remains close to a financial vision of accountability (similar to the

agency theory) whereas it is appropriate to extend effectiveness to social and

environmental issues (Coupet and Broussard, 2021). This research therefore contributes

to the literature on several aspects: given the sometimes-random effects of accountability,

it is necessary to produce nuanced theories; governance should oscillate between

equilibrium and adaptation in the face of stakeholders; and finally, this article introduces

the risk of insensitivity of NPOs to accountability (i.e. they act as they wish, regardless

of control mechanisms such as accountability).

This paper starts with a literature review on accountability and effectiveness in

NPOs, in which the relevance of stakeholder theory is recalled. The hypotheses are based

on this theory and the empirical literature, before the method is presented. The results of

the regressions conducted are proposed before a discussion of the contributions of the

article.

2. Literature review: defining accountability and effectiveness in NPOs

2.1. Accountability in non-profit organizations

In a rather broad view, accountability may allow stakeholders to verify that the

NPO act as they expect. It is defined by Unerman and O’Dwyer (2006, p. 351) as the

“mechanisms through which all those affected by an organization’s actions can demand

an account from the managers of that organization regarding how and why the

organization has acted in the manner it has”. An example of accountability is reporting

(Ling Wei et al., 2008), widely used by NPOs due to certain legal obligations: annual

activity, financial and moral reports are produced. Accountability can be the recognition

of the existence of an authority to which the organization is responsible for its actions

(Ebrahim, 2005). In addition, Benjamin (2008, p. 207) proposes the concept of account

space as “the explanatory accounts that non-profits give when they fail to meet the

expectations of a stakeholder”. Accountability is therefore as important for success as for

failure. As a result, accountability is eminently contextual (Williams and Taylor, 2013),

subjective (Dhanani and Connolly, 2012) and consequently socially constructed

(Kennedy, 2019). This complexity implies for NPOs as well as for researchers specific

approaches (Ebrahim, 2003), for example based on a country, as proposed by the present

study. Accountability practices are evolving rapidly, particularly thanks to the Internet

and social networks (Amelia and Dewi, 2021). Moreover, it is not limited to the financial

or activity reports that NPOs are used to produce: it is extended to “social” data (dedicated

to members, volunteers or employees), internal life, environment, or even sustainability

of the action (Carvalho et al., 2017). Accountability therefore tends to broaden (Morrison,

2020), in line with the growing consideration of stakeholders in management. For

example, Dainelli et al. (2013) emphasize the requirement to hear and respond to the

stakeholders’ needs. This approach corresponds to the growing application of stakeholder

theory in the field of non-profit accountability (Chen et al., 2020).

Stakeholder theory is indeed concerned with the people or groups that affect,

influence, are affected by or are influenced by the organization (Freeman et al., 2020).

The wide variety of their interests is therefore the main concern of NPOs. These interests

are sometimes divergent and sometimes convergent, and are particularly variable. NPOs

therefore face tensions between the stakeholders they manage. These extremely strong

relationships force managers to try and satisfy each of their stakeholders. This theory is

divided into three approaches (Mehedi and Jalaludin, 2020). The descriptive approach

promotes and explains how stakeholder management works. The instrumental

perspective looks at the consequences of such a strategy. Finally, the normative

dimension provides an ethical vision: organizations have to be oriented towards society

and stakeholders.

For NPOs, the descriptive and instrumental forms of this theory insist on their

democratic ideal. NPOs are indeed asked to integrate the stakeholders’ demands in

governance and in their mission. Moreover, NPOs are concerned with society and its

well-being, in line with the normative vision of this theory. Beyond this transposition,

non-profit scholars have explained the relevance of this theory for NPOs (Andersson and

Renz, 2021; Renz et al., 2023; Van Puyvelde et al., 2012). First, it is relevant because

they are community organizations that need stakeholders to carry out their mission, which

is itself stakeholder-focused. Second, and consequently, this theory emphasizes that

NPOs are responsible and accountable to a wide range of stakeholders. Third, this theory

is useful for NPOs because it takes into account their organizational context, which is

precisely influenced by stakeholders. Finally, stakeholder theory takes precedence over

agency theory in studying NPOs.

According to Pilon and Brouard (2022), this theory is associated with a

stakeholder-oriented accountability that emphasizes the organization’s responsibility.

The theory thus highlights a strong link between accountability and effectiveness

(Ebrahim, 2005; Pawson and Joannidès, 2014). This fairly broad approach had also been

adopted by Dhanani and Connolly (2012, pp. 1145–1147), who constructed a list of

accountability practices, that can be qualified as disciplinary. Finances, performance and

activities are summarized within managerial (or strategic) accountability, the “core

purpose”. Organizational (or procedural) accountability presents teams and ethical

policies (“internal organizational operations”). Governance and its mechanisms are

explained in fiduciary accountability (“probity and compliance, and at an operational

level, good governance and control”). Finally, downward accountability is about

stakeholder participation, grant policies and team protection. Here, in line with Bovens

(2010), accountability is thus a formal and processual mechanism for values and strategy,

and not an ideal “virtue”. Following Andreaus and Costa (2014), this study is based on

two of the three pillars of accountability: the social dimension (linked to social and

environmental reporting) and the financial dimension (linked to the income statement).

2.2. Effectiveness issues in NPOs

Effectiveness is “the degree of success with which organizational goals are

achieved” (Mensah et al., 2008, p. 325) and is a part of performance in NPOs (Liket et

al., 2014). Adopting the stakeholder theory has important consequences for the definition

of non-profit effectiveness. It is “highly subjective and context-dependent” (Willems et

al., 2016, p. 454), for many reasons. First, it is particularly dependent on evaluation

methods and these methods are often unclear and vary according to the evaluators (Boon

et al., 2017; Molecke and Pinkse, 2017). Second, NPOs’ outcomes are almost

imperceptible, because they are “qualitative and vague”, “difficult to measure” and

because NPOs’ “interventions are uncertain” (Kleszczowski, 2017, p. 71). In other words,

understanding how invested resources are transformed into outcomes is complex. The

same is true for determining the extent to which the NPO and its action actually contribute

to the final societal outcomes (Kleszczowski, 2017). Third, NPO performance and

effectiveness are subjectively defined by each of its stakeholders (Mano, 2010):

stakeholders participate in defining, measuring and evaluating organizational

performance and provide resources in return. In this, NPOs’ effectiveness is a social

construct: “it exists in the minds of the organization’s diverse internal and external

stakeholders” (Murray, 2010, p. 433).

Stakeholder theory thus offers various dimensions of effectiveness, particularly at

the organizational, social and environmental levels. Recent studies indeed call for a

reflection on NPOs’ performance and effectiveness that are less focused on financial

health (Coupet and Broussard, 2021). The literature recognizes that performance is

multidimensional: it can be linked to “financial, stakeholder, market, mission” aspects

(Mihaltan et al., 2015, p. 369) or “overall” (Boateng et al., 2016).

Following this approach, NPOs’ effectiveness can no longer be summarized as

financial capacity, but encompasses the social and environmental dimensions (Weinert,

2016). In this study, we will focus on three effectiveness dimensions (Verschuere and

Suykens, 2020). Financial effectiveness is linked to the ability to finance the NPO and

ensure economic viability. Social effectiveness is associated with actions in favour of and

developing human capital. Finally, environmental effectiveness is about initiatives that

protect the environment and ensure the sustainability of the organizational action.

3. Hypotheses development: recent developments on accountability

The link between accountability and effectiveness has already been studied in the

literature. the majority of empirical studies on the subject conclude that there is a positive

relationship, as indicated by recent literature reviews (Grossi et al., 2019; McGee and

Gaventa, 2010). This result was found in all types of organizations: companies (e.g., see

the two previous references), public administrations (Dikopoulou and Mihiotis, 2010;

Free and Radcliffe, 2009; Heinrich, 2002; Rabovsky, 2012), and NPOs (Costa et al.,

2011; Cutt and Murray, 2000; Hengevoss, 2023; Mohd Noor et al., 2017). Nevertheless,

the debate is beginning to open on the nature of accountability in order to rework this a

priori positive link (e.g. Ali and Nicholson-Crotty, 2021). The stakeholder theory is also

part of this debate and emphasizes that organizations seek to meet the demands of their

environment. In this, NPOs are held accountable less for their financial effectiveness than

for their ability to achieve their mission or be ethical. Both stakeholder theory and critical

studies thus make accountability a process for the “common good” (Pesci et al., 2020)

and much less about financial issues. This approach will therefore have consequences for

the formulation of hypotheses.

Financial effectiveness is linked to the capacity to attract public or private external

funders and is influenced by accountability (Costa et al., 2011; Ebrahim, 2005). This

process signals the financial, social, societal and environmental commitments that are

criteria for allocating funds to NPOs. Transparency is also known to enhance financial

effectiveness (Zainon et al., 2014).

Nevertheless, this conceptual approach is confronted on the one hand with

empirical literature and on the other hand with stakeholder theory. A recent study (Lee et

al., 2023) points out that, at the empirical level, the link between accountability and

financial effectiveness has been little tested. In support of their argument, the authors

point out that the managerial costs of accountability are high and that adapting to the

changing demands of stakeholders requires investment. Finally, their extensive empirical

study confirms that a high level of accountability worsens financial effectiveness.

Beyond that, the surge in transparency is beginning to raise questions in the

literature, which anticipates negative effects on organizations (Mayrhofer and Meyer,

2020). In the face of divergent interests and requirements, accountability can indeed have

perverse effects on financial effectiveness (Kim, 2005). In addition, stakeholder theory

leads to a preference for accountability based on organizational effectiveness,

collaboration and cooperation with stakeholders. Such an approach leads to a strategy that

emphasizes mission over finance (Morrison, 2020; Mourey, 2021). In this,

H1: The development of accountability practices in NPOs negatively affects their

financial effectiveness.

The link between accountability and social effectiveness is differently

documented in the literature. Stakeholder theory leads to two observations. First, NPOs

belong to a social sector with strong human values. The development of individual

stakeholders is an integral part of organizational issues (Freeman et al., 2021). Second,

as indicated in the literature review, new societal demands are emerging with respect to

working and volunteering conditions. The understanding and incorporation of these

societal expectations can then be achieved through accountability (Abbas and Ahmed,

2016). In addition, recent research (Jiao, 2021) has shown that the feeling of

responsibility resulting from accountability leads NPOs to make new commitments and

to do everything possible to develop their social performance. In short, the broad

accountability induced by the stakeholder theory implies a strong organizational

commitment (Pilon and Brouard, 2022). Because of NPOs’ dependence on human capital,

one of the ways to achieve their mission is to participate in skills development (Henderson

and Sowa, 2018).

Finally, the link between governance, accountability and social performance has

also already been analysed and is theoretically positive (Chu and Luke, 2023; Estapé‐

Dubreuil and Torreguitart‐Mirada, 2015). Some studies have empirically confirmed this

link (Bagnoli and Megali, 2011; Bradford et al., 2020), while pointing out that it is often

found in the medium term. More indirectly, studies have also shown that accountability

strengthens non-profit capacity and social performance (Nordin et al., 2022; Stainer and

Stainer, 2000). In this,

H2: The development of accountability practices in NPOs positively affects their

social effectiveness.

The same principles of stakeholder theory can be applied to environmental

effectiveness. NPOs that are effectively accountable to stakeholders feel more responsible

(Jiao, 2021), in particular because they listen to stakeholders’ expectations expressed in

the accountability process. Some of these expectations are linked to environmental

concerns and constitute incentives to make new commitments (Kassinis and Vafeas,

2006). These concerns become a social norm with which NPOs comply: in short, this is

an issue of competitiveness and legitimacy for a sector that is still not very committed to

its environmental performance (Dart and Hill, 2010).

In addition, more and more regulators and stakeholders require a detailed report

on the environmental impact of events they funded (Costa and Goulart da Silva, 2019).

Being accountable about this impact leads to an awareness (e.g. Chinander, 2001) or

becomes a constraint (Jiang et al., 2022). Organizational sustainability is part of societal

requirements and stakeholders’ expectations (Freeman et al., 2021) and the quality of the

activity can be influenced by accountability practices (Becker, 2018).

Finally, accountability is known to increase commitments to sustainable

development (e.g. IFRS, 2021; Jones and Mucha, 2014). An empirical link is also

established between accountability, adaptive capacity and environmental effectiveness

(Banjongprasert, 2022, cited by Nordin et al., 2022). In this,

H3: The development of accountability practices in NPOs positively affects their

environmental effectiveness.

4. Methods

4.1. The case of French NPOs

This article proposes a contribution to the study of NPOs that is still under-

explored. More specifically, this study is based on French NPOs, in particular because

management research dedicated to French NPOs is still emerging (Plaisance, 2021).

Consequently, current studies can only be based on the scarce data available which leads

to numerous methodological limitations.

The majority of French NPOs are grassroots volunteer organizations (GVOs) and

are called “associations”. The French law of 1901 on “association contracts” states that

an association is a “convention by which two or more people pool, on an ongoing basis,

their knowledge or activity for a purpose other than sharing profits”. This subgroup of

NPOs is the one studied.

French NPOs play multiple roles in the economic and social development of

territories, in social cohesion and in civic and citizenship education. They are part of the

social and solidarity economy, defined by the Hamon Law of 2014. This law requires

NPOs to meet democracy criteria. Beyond this legal aspect, the principle of “one person,

one vote” is part of their democratic essence. NPOs are defined by an “associative

project” that specifies the organization’s vision for its future but also for society.

NPOs account for a budget close to 113 billion euros (4% of national GDP), 1.76

million employees (6.5% of employment, but 10% of private employment) and 31.2

million voluntary participations (Tchernonog and Prouteau, 2019). Recruitment in NPOs

has been double that of other sectors in recent decades (Archambault et al., 2014).

4.2. Data

The data are linked to IDEAS, the Institute for Development of Ethics and Action

for Solidarity. This NPO acts in favour of a better transparency in the third sector by

supporting in their daily life. In addition, in the past, IDEAS offered to NPOs the

possibility to publicly disclose their organizational results. In this, French NPOs were

able to declare parts of their legal documentation and disclose their organizational

characteristics and their governance practices. The public website (https://ideas.asso.fr)

was last accessed on in March 19, 2019 (close to Connolly and Dhanani, 2013). At that

date, 182 NPOs had released their 2018 information, including reports and social and

environmental commitments. The data from each page of each organization was recorded

in a table. Table I shows the data collected.

[Table I here]

Consequently, NPOs in the database have specific characteristics. First, they

choose to be transparent. This voluntary declaration represents a bias in the sample: they

are potentially the most invested in the indicators they publish. Secondly, IDEAS seeks

to promote good management and transparency. By disclosing, NPOs show that they are

confident about their functioning or that they are effectively supported by IDEAS.

Finally, the majority of the sample are large NPOs, as shown by the number of employees

or by their resources. It is therefore not a representative sample of French NPOs, but

rather a group of organizations with employees, well-developed management and large

resources.

4.3. Variables, statistical method and control variables

In order to test the hypotheses, three types of dependent variables are selected:

these effectiveness indicators are adapted from the IDEAS database. First, NPOs’

financial documents provide large volumes of data. One indicator of financial

effectiveness is calculated: the return on assets (ROA) as total revenue minus total

expenses divided by total assets (Ritchie and Kolodinsky, 2003). Other indicators of

resource attraction (incomes, grants, donations and memberships) come from the

literature (Epstein and McFarlan, 2011; Ritchie and Kolodinsky, 2003). Second, social

effectiveness indicators proposed by the IDEAS database relate to the existence of

training processes and of a policy for recruiting people in difficulty (with disabilities, in

social and professional reinsertion, etc.). They illustrate social effectiveness because they

focus on employee development and the value of human resources (Estapé‐Dubreuil and

Torreguitart‐Mirada, 2015; Pope et al., 2018). Third, environmental effectiveness is

measured by three indicators. NPOs can indicate if (and what) initiatives are implemented

to improve environmental protection at headquarters and in the field (e.g. Maurel and

Tensaout, 2014) but also to develop the sustainability of action (e.g. Weerawardena et al.,

2010). In the database, the existence of each of the three types of initiatives results in

three binary variables.

The independent variables are linked to the accountability quality, which is

studied via the Accountability Disclosure Index (ADI) proposed by Dhanani and

Connolly (2012, p. 1153). The ADI provides a suitable score for understanding

accountability practices. The authors write: “ADIj [is] the accountability disclosure index

for each accountability theme and in total, for charity j” is calculated by summing the

quotient of each “nj, the number of accountability items relevant for the charity j” by “Xij

: 1 if the ‘i’th item for charity j is disclosed and 0 if it is not disclosed, so that 0 ≤ ADIj ≤

1”. A content analysis produces information for each item in each category for each type

of accountability. Organizational accountability refers to ethical policies (investment,

purchasing, fundraising, trading), staff, volunteer policies and stakeholders. Managerial

accountability highlights finance, overall organisation efficiency, fundraising efficiency,

direct charitable activities and performance. Fiduciary accountability relates to

organizational structure, governance, financial, risk management, compliance and

evaluation. Finally, downward accountability is interested in grant-making policies,

board representation, complaints procedures, health and safety, safety and security and

participation. ADI is the global indicator that is calculated on the basis of all items. The

other four indicators are calculated from the associated items. The higher the ADI, the

more items making up the four types of accountability are disclosed and the more

developed the accountability practices are.

Two control variables were available and thus selected: age of the organization

and number of employees (Bryan, 2019, p. 894). In this, the empirical model can be

summarized as follows (see Tables III for abbreviations). OLS regressions are estimated

for financial effectiveness indicators analysis (testing H1) and probit regressions are

estimated for social and environmental effectiveness indicators analysis (testing H2 and

H3):

• financial effectiveness indicators = α0 + α1 × Age + α2 × Size + α3 × ADI + α4 ×

(ADIFA) + α5 × (ADIOA) + α6 × (ADIDA) + α7 × (ADIMA) + ε.

• social effectiveness indicators = β0 + β1 × Age + β2 × Size + β3 × ADI + β4 ×

(ADIFA) + β5 × (ADIOA) + β6 × (ADIDA) + β7 × (ADIMA) + ε’.

• environmental effectiveness indicators = γ0 + γ1 × Age + γ2 × Size + γ3 × ADI + γ4

× (ADIFA) + γ5 × (ADIOA) + γ6 × (ADIDA) + γ7 × (ADIMA) + ε’’.

Endogeneity and robustness tests are proposed and fully detailed in Table IVd.

5. Results

5.1. Descriptive statistics and correlation matrix

Descriptive statistics (Table II) call for some remarks. First, the sample is

composed of fairly old organizations with a large number of employees. Financial

effectiveness indicators confirm this impression as do report budgets averaging around

20 million euros. On average, one-third of this budget is allocated through grants. About

their social performance, the NPOs in the sample are particularly committed to volunteer

training. One in two NPOs implements a policy of environmental protection or a measure

to sustain its action. The correlation matrix (Table III) calls for a few remarks. First, the

size is not related to the different indicators selected; while age has multiple effects. Not

surprisingly, the different accountability indicators are correlated, as NPOs generally

engage in parallel efforts to develop their transparency. Finally, significant correlations

appear within each type of effectiveness. This can be explained by the high dependence

of NPOs on grants and the simultaneous adoption of social and environmental initiatives.

[Tables II and III here]

5.2. OLS and Probit regressions

First of all, the OLS regressions on financial effectiveness indicators have

contrasted results. ROA is not explained by control variables or accountability (the null

hypothesis cannot be rejected, F = 0.42; p = 0.89), unlike the other three more descriptive

indicators of financial effectiveness. However, accountability helps to understand the

other, whose regressions are presented in Table IVa. First, the ADI aggregate plays a

positive role on the amount of grants (α = 98,849; p < 0.10). In France, accountability for

grant-funded activities is mandatory but this result shows that accountability quality is

beneficial to grant amounts. Second, donors and members have a sensitivity to fiduciary

accountability (α = 17,460; p < 0.05). Knowing the organization’s governance and

financial policies therefore helps to engage them. Organizational accountability,

illustrating both human resources and ethical principles, has a positive effect on the total

incomes (α = 227,832; p < 0.001), the grants (α = 57,216; p < 0.10) and the donations and

memberships (α = 12,824; p < 0.10). In other words, the emphasis on ethics and people

(and in particular on dependence on people) does have a major effect on financial

indicators.

The results about social effectiveness indicators (Table IVb) show that the

implementation of training for employees is not explained by accountability but they are

more developed in mature NPOs. The employment of disadvantaged people or with

disabilities is supported by good organizational (β = 1.87; p < 0.10) and downward

accountability (β = 1.49; p < 0.10). This result is understandable in light of their content:

NPOs mention the importance of human capital, stakeholder participation or their ethical

principles.

Finally, none of the regressions about environmental effectiveness indicators are

significant (Table IVc). The null hypothesis cannot be rejected for the three indicators

(the p-values vary between 0.10 and 0.20). No control variable is even relevant.

[Tables IVa,b,c here]

5.3. Endogeneity tests: 2SLS regressions

The two control variables participate to control endogeneity in the relationship

between accountability and effectiveness. Nevertheless, numerous questions remain

about possible causalities between these concepts. In theory, in NPOs, this endogeneity

is particularly reduced in the absence of owners and because of the major differences

between for-profit and not-for-profit governance.

However, a Two-Stage Least Squares (2SLS) regression analysis is proposed. In

view of the independent variables available, the two control variables (age and size) and

and, in congruence with Dhanani and Connolly (2012)’s construction of their indices, the

4 sub-dimensions of the ADI were retained as instrumental variables. The ADI variable

is the explanatory variable. In this, the selected system of equations becomes:

• Effectiveness indicators = β0 + β1 × ADI + u

• ADI = γ0 + γ1 × Age + γ2 × Size + γ3 × (ADIFA) + γ5 × (ADIOA) + γ6 × (ADIDA)

+ γ7 × (ADIMA) + v

The tables IVd present the results of these 2SLS regressions.

[Tables IVd here]

Consistent with the results of the OLS regressions, the regression dedicated to

ROA remains insignificant. In addition, improved accountability (ADI) has a positive

effect on total incomes (β = 200,461; p < 0.01), grants (β = 83,633; p < 0.01), and

donations and memberships (β = 29,949; p < 0.001). In this, the hypothesis H1 is rejected,

because it focused on the negative financial effects of accountability. However, no

relationship is found with financial effectiveness ratios, which further nuances the

hypothesis.

Then, the 2SLS regression shows a positive effect of ADI on the employee

training plans (β = 0.75; p < 0.01) and on the employment of disadvantaged people or

with disabilities (β = 0.71; p < 0.05). As expected, NPOs are organizations with deep-

rooted values that are promoted in their accountability reports and that they apply in

practice. In addition to the congruence with the Probit regressions in the case of

employment of disadvantaged people or with disabilities, the 2SLS regressions add

information about the employee training plan. While the development of certain

dimensions of ADI has no direct effect, a better overall quality of ADI does have an effect.

There is thus a synergistic phenomenon here. In this, the hypothesis H2 is supported.

By contrast, consistent with the results of the Probit regressions, the regressions

of the environmental effectiveness indicators are not significant and this is confirmed by

the other endogeneity tests: the hypothesis H3 is rejected.

5.4. Robustness checks

To investigate the robustness of the results, three additional studies were

conducted. They are available in Supplementary Materials. Their variety confirms the

complexity of the concepts studied and the fact that they are sometimes paradoxical.

The first study focused on a sub-sample that would include only NPOs with

national activities (Appendix A). International NPOs are indeed subject to more

regulatory and managerial pressures. This new sample is composed of 147 NPOs. The

results remain robust, but a nuance must be made: the employment of disadvantaged

people or with disabilities is no longer explained by the ADI – DA.

The second is a sub-sample of 130 NPOs that belong to a network or federation,

which would allow NPOs to be accompanied in their management (Appendix B). The

results also remain robust (the incomes total is even better explained by the variables),

but two nuances must be made. On the one hand, donations and memberships are no

longer explained by the ADI – FA and the employment of disadvantaged people or with

disabilities is no longer explained by the ADI – DA.

Finally, the third study is dedicated to a subsample of 138 NPOs that did not

comply with a donor protection charter (Appendix C). The NPOs have therefore not

developed specific management processes on the subject. The results are still robust (the

grants, the donations and memberships and the employee training plan are even better

explained by the variables), but a nuance must be made: the total incomes is no longer

explained by the ADI – OA.

6. Discussion

The results of this study call for several comments, particularly with respect to the

effectiveness indicators not explained by the accountability. First, the ROA of the NPOs

in the sample is not explained by the selected variables. The concept of profitability is of

great concern to NPOs, particularly because their objective is above all to achieve their

mission and have a positive impact on society. Financial performance may be a

fundamental pillar of NPOs’ survival, but it is still a controversial subject. NPOs prefer

to highlight their actions rather than their balance sheets (Clerkin and Quinn, 2019).

However, the hypothesis H1 is essentially rejected because of the link between

accountability and financial effectiveness. In positioning the first hypothesis within the

most recent research streams (Lee et al., 2023), this study is finally confronted with two

dimensions of accountability that may have been overlooked. Its first characteristic is its

complexity: the determinants and effects of accountability in NPOs are unpredictable and

highly varied (Young, 2002). Its second characteristic is its paradoxical aspect: depending

on the period, the context, the people, etc., accountability can have opposite and

contradictory effects (Halligan, 2007). In sum, the results illustrate the synthesis of Renz

et al. (2023, p. 12) who advocate a “multifaceted and nuanced” research on non-profit

governance.

Hypothesis H2 is supported. This study is therefore in line with the literature

already mobilized on the subject (Jiao, 2021; Nordin et al., 2022). However, the fact that

NPOs are subject to regulatory pressures that lead them to adopt plans for training or

better integration of people in difficulty should not be underestimated. Consequently, in

future studies, new indicators of social effectiveness (in relation to volunteers, for

example) seem essential.

Then, all environmental indicators are not influenced by accountability practices.

The following comments therefore relate to the status of hypothesis H3. In their work on

NGOs, Yasmina and Ghafran (2019) have theorized the problematics of accountability.

The authors have pointed out the many issues of social construction, aporia and

uncertainty that surround accountability. Their approach even leads them to question the

ethics of transparency underlying accountability. For instance, some authors had shown

how transparency is important in a democratic ideal, but this ideal can be detrimental to

the organization if it is too extreme (Unerman and O’Dwyer, 2006).

Their vision is similar to Ebrahim (2005)’s work on the risk of myopia in

accountability: even if a long-term vision is much more important for ensuring the

organization’s survival and the stakeholders’ commitment, NPOs sometimes remain

focused on the financial aspects. The author stressed the importance of a “balance” and

“combination” of accountability mechanisms to meet the demands of the environment. In

this, the results obtained here highlight another issue, less violent than those pointed out

by Yasmina and Ghafran (2019) and complementary to myopia: insensitivity.

In other words, accountability quality has no effect on environmental

effectiveness, has little effect on social effectiveness, but does attract resources. The

quality of broad accountability defined by Dhanani and Connolly (2012) incorporates a

rather disciplinary view, trying to coerce the organization into reporting to inform and

engage its stakeholders. This disciplinary approach seems irrelevant insofar as NPOs are

insensitive to it: for instance, one out of two NPOs is engaged in actions related to

environmental effectiveness, regardless of its commitment to accountability.

Accountability has been reappropriated by NPOs, which seem to use it as a tool

to obtain funds rather than as a holistic tool for engagement. The literature has already

emphasized the ambiguity of the concept of accountability. As a result, some authors

(Pras and Zarlowski, 2013, pp. 24–27) point out that this ambiguity can become fruitful

for NPOs’ leaders, in line with the “ambiguity and compromise” in the objectives,

mission and NPOs in general. Accountability, thanks to the “coupling/decoupling” games

(Brandtner, 2021), then gives more latitude to the leaders and gives them back the power.

Nevertheless, the results presented here are congruent with Ebrahim (2005)’s

vision. The lack of a clear contribution of accountability quality to non-financial

effectiveness confirms the myopia that accountability can create: when organizations

focus on the short term, overall effectiveness and performance are neglected (Costa and

Goulart da Silva, 2019).

To conclude, this study illustrates the obstacles that NPOs face in broadening their

accountability (Morrison, 2020). Still in search of legitimacy (Yasmin and Ghafran,

2021), NPOs have to face their stakeholders’ mistrust and monitoring. Their

accountability is therefore formal and seeks to obtain funds in order to survive, and not

necessary to perform (cf. the contrasting result between ROA and the indicators of

obtained funds). Conversely, to develop their social and environmental effectiveness,

NPOs don’t develop formal accountability: they would rather need their stakeholders’

trust and to collaborate with them. This implies a less formal, more mission-oriented,

more creative and therefore heterodox accountability. Renz et al. (2023) also highlight

this challenge, noting that the societal issues associated with NPOs and accountability are

major.

7. Conclusion

Based on recent studies dedicated to non-profit accountability, this article sought

to investigate the link between this process and organizational effectiveness. A negative

link was expected in the case of financial effectiveness and a positive one in the non-

financial case. A partially positive result was obtained in the financial case and, with the

exception of specific social indicators, no link was found in the non-financial case. These

unexpected results challenge recent developments in accountability theory and return to

findings from twenty years ago.

In addition to the above discussion, this study offers theoretical contributions.

Twenty years after the studies pointing out the complexity and paradoxes of

accountability (Halligan, 2007; Young, 2002), the research dedicated to NPOs must

consider what to do with this process. Stakeholder demands remain important, but

managing them through accountability seems far too uncertain to remain the focus of

attention. The results of this study therefore call for a rethinking of the accountability in

NPOs, particularly because the concepts studied here (accountability, effectiveness, etc.)

are considered contingent by the literature.

This study followed the recommendations of Yasmin and Ghafran (2021). For the

authors, there was a need for accountability research that focused on relationships with

and between stakeholders and their attributes (i.e., interpretive researches) and on the

contradictions and paradoxes encountered in non-profit accountability (i.e., radical

researches). In fact, in line with Morrison (2020), the results suggest the need of a focus

on informal accountability, in order to approach the associated cognitive and behavioural

issues (Marnet, 2008).

Furthermore, the use of stakeholder theory to accurately describe the case of

French NPOs did not adequately explain the link between accountability and

effectiveness. Because of the dynamics that run through this sector, a combination of

governance theories seems necessary. The suggestion of Pilon and Brouard (2022) will

be a relevant guide for this. Finally, calls from research to study NPOs (for instance,

Erkens et al., 2015) or disclosure effects on performance (Grossi et al., 2017) are

addressed here.

Practitioner and societal contributions are of several kinds. The first one

corresponds to the previous call concerning accountability in NPOs: this process is

extremely complex, uncertain and full of paradoxes. The increasing demands on the

subject are not without risk and other approaches could be explored (e.g., evaluation and

control through relationship quality, Plaisance, 2022).

In the French case, the codes of non-profit governance refer to rather disciplinary

principles that would improve organizational effectiveness. The results are particularly

inconsistent on this subject. This study therefore calls for an update of these codes. They

could incorporate more informal governance mechanisms and consider cognitive and

behavioural issues, which are largely involved in accountability.

In addition, French NPOs are again particularly poorly informed by the results of

the international literature on governance and accountability (Plaisance, 2023). This

implies the development of contextualized research on French NPOs, but also the need to

develop the sector’s own best practices. As a result, this article questions the relevance of

developing codes of good practice and considers that they should rather focus on the

implementation of practices specific to NPOs and to each organization.

The different results and the sceptical literature on accountability do not mean that

French NPOs should not adopt such a process. However, they do call for an adaptation to

each organizational situation and for a reflection on the links with the stakeholders

requesting accountability processes.

Several limitations need to be pointed out in this study. First, further studies are

necessary in order to remove the context of large NPOs. Second, new methods are needed

to replace the binary variables, develop new control variables and use qualitative methods

(e.g. textual disclosures, interviews, etc.). In addition, the effectiveness indicators were

imposed by the data. A questionnaire survey would allow the selection of new proxies.

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Table I. Variables and their measurement

N°

Nature

Measurement

Control variables

Age

Metric

Obtained by subtracting 2018 from the year

of creation (information provided on each

NPO’s page of the IDEAS website).

Size

Metric

Number of employees (information provided

on each NPO’s page of the IDEAS website).

Accountability variables

ADI

Ratio

Obtained by calculation according to the

method proposed by Dhanani and Connolly

(2012). The calculations are based on all the

reports that each NPO has made public on

the IDEAS website.

ADI – Fiduciary accountability (FA)

Ratio

ADI – Organizational accountability (OA)

Ratio

ADI – Downward accountability (DA)

Ratio

ADI – Managerial accountability (MA)

Ratio

Financial effectiveness variables

ROA

Ratio

Obtained by the total revenue minus total

expenses divided by total assets. The data

came from the financial reports.

Total incomes (in thousands)

Metric

Directly obtained from the financial reports.

Grants (in thousands)

Metric

Information provided on each NPO’s page

of the IDEAS website.

Donations and memberships (in

thousands)

Metric

Information provided on each NPO’s page

of the IDEAS website.

Social effectiveness variables

Employee training process

Binary

The presence (1) or absence (0) of this

commitment was directly indicated on each

NPO’s page of the IDEAS site.

Employment of disadvantaged people or

with disabilities

Binary

Environmental effectiveness variables

Concrete actions for the protection of the

environment at headquarters

Binary

The presence (1) or absence (0) of this

commitment was directly indicated on each

NPO’s page of the IDEAS site.

Concrete actions for the protection of the

environment in the field

Binary

Sustainability of action in the field

Binary

Source: Table created by author.

Note: The variables integrate four categories that constitute the four types of

accountability. For the items used for each category, see the checklist built by Dhanani

and Connolly (2012). The name of each type varies between the published article and the

tool transmitted by the authors: both terminologies were indicated in the literature

review.

Table II. Descriptive statistics

N°

Mean

Median

Standard-

Deviation

Control variables

Age

182

41.26

39.70

Size

1,569

17.5

16,381

Accountability variables

ADI

160

0.36

0.3719

0.16

ADI – Fiduciary accountability (FA)

0.18

0.2

0.16

ADI – Organizational accountability (OA)

0.16

0.125

0.15

ADI – Downward accountability (DA)

0.08

0.16

ADI – Managerial accountability (MA)

0.46

0.4444

0.22

Financial effectiveness variables

ROA

123

0.05

0.0154

0.22

Total incomes (in thousands)

176

19,678

1,345

98,296

Grants (in thousands)

175

8,421

200

47,960

Donations and memberships (in thousands)

176

3,685

179

11,858

Social effectiveness variables

Employee training process

182

0.69

0.46

Employment of disadvantaged people or with

disabilities

0.35

0.48

Environmental effectiveness variables

Concrete actions for the protection of the

environment at headquarters

182

0.52

0.50

Concrete actions for the protection of the

environment in the field

0.46

0.50

Sustainability of action in the field

0.55

0.50

Source: Table created by author.

Table III. Correlation matrix

1. Age

2. Size

0.08

3. ADI

0.08

0.09

4. ADI–FA

0.14

-0.06

0.60***

5. ADI–OA

0.22**

0.03

0.55***

0.42***

6. ADI–DA

0.20*

-0.01

0.44***

0.55***

0.43***

7. ADI–MA

0.03

0.07

0.84***

0.42***

0.46***

0.36***

8. ROA

-0.09

-0.04

0.11

0.00

0.05

0.03

0.09

9. Incomes

0.25***

0.09

0.26***

0.29***

0.43***

0.29***

0.13

-0.04

10. Grants

0.17*

0.07

0.27***

0.19*

0.29***

0.19*

0.17*

-0.03

0.80***

11. Donations & membership

0.23**

0.08

0.29***

0.32***

0.24**

0.25**

-0.07

0.63***

0.33***

12. Employee training

0.17*

0.06

0.24**

0.12

0.19*

0.18*

0.22**

-0.03

0.12

0.09

0.19*

13. Employments of d. people

0.16*

0.12

0.14

0.15

0.26***

0.25**

0.15

-0.09

0.25***

0.19*

0.35***

0.37***

14. Environment protection at headquarters

-0.12

0.08

0.03

-0.08

0.03

-0.06

0.03

0.14

0.08

0.09

0.04

0.22**

0.06

15. Environment protection in the field

-0.18*

0.08

-0.01

-0.12

-0.03

-0.07

0.02

0.19*

-0.01

0.08

-0.05

0.04

0.06

0.57***

16. Sustainability

-0.07

0.08

0.16*

0.04

0.08

-0.04

0.12

0.04

0.08

0.11

0.04

0.12

0.06

0.38***

0.51***

Source: Table created by author.

Reading: ***: p < 0.001, **: p < 0.01, *: p < 0.05.

The high coefficients within the accountability variables are due to the very nature of the index (Dhanani and Connolly, 2012) and the link between

incomes and grants is representative of the French case.

Table IV. Empirical results

Table IVa. OLS regressions of financial effectiveness indicators

ROA

Total incomes (in

thousands)

Grants (in thousands)

Donations and

memberships (in

thousands)

Constant

0.00

(0.04)

-47,721

(20,698)

-23,236

(11,083)

-6,155

(2,607)

Age

-0.00

(0.00)

334

(181)

134

(96)

(23)

Size

0.00

(0.00)

0.49

(0.42)

0.12

(0.22)

0.05

(0.05)

ADI

0.18

(0.20)

115,923

(99,489)

98,849

(53,270)

-815

(12,529)

ADI – FA

-0.09

(0.12)

90,578

(63,774)

-4,104

(34,147)

17,460

(8,031)

ADI – OA

0.06

(0.14)

227,832

***

(61,755)

57,216

(33,066)

12,824

(7,777)

ADI – DA

0.01

(0.11)

49,423

(57,554)

8,680

(30,817)

303

(7,248)

ADI – MA

-0.03

(0.13)

-100,353

(62,316)

-41,186

(33,366)

6,386

(7,847)

118

158

157

158

0.42

n.s.

8.04

***

3.05

4.94

***

R²

0.02

0.27

0.13

0.19

Ajusted R²

0.00

0.24

0.08

0.15

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p <

0.01, *: p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Table IVb. Probit regression of social effectiveness indicators

Employee training plan

Employment of

disadvantaged people

or with disabilities

Constant

-0.50

(0.33)

-0.69

(0.30)

Age

0.01

(0.00)

0.00

(0.00)

Size

0.00

(0.00)

0.00

***

(0.00)

ADI

1.32

(1.57)

-2.55

(1.53)

ADI – FA

-0.77

(1.10)

0.81

(0.96)

ADI – OA

0.66

(1.08)

1.87

(0.99)

ADI – DA

1.20

(1.01)

1.49

(0.85)

ADI – MA

0.39

(1.01)

0.94

(0.95)

160

-2 Log(Likelihood)

19.97

34.10

***

R²(Nagelkerke)

0.17

0.26

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p <

0.01, *: p < 0.05 and ^: p < 0.10. SE: standard error.

Table IVc. Probit regression of environmental effectiveness indicators

Environment

protection at

headquarters

Environment

protection in the

field

Sustainability

Constant

0.23

(0.29)

0.25

(0.30)

-0.26

(0.29)

Age

0.00

(0.00)

0.00

(0.00)

0.00

(0.00)

Size

0.00

(0.00)

0.00

(0.00)

0.00

(0.00)

ADI

0.47

(1.41)

-0.14

(1.44)

2.00

(1.44)

ADI – FA

-1.03

(0.91)

-1.33

(0.94)

-0.20

(0.92)

ADI – OA

0.37

(0.92)

0.09

(0.93)

0.03

(0.93)

ADI – DA

0.40

(0.82)

-0.03

(0.84)

-1.13

(0.82)

ADI – MA

0.08

(0.89)

0.54

(0.90)

-0.31

(0.90)

160

-2 Log(Likelihood)

9.78

n.s.

12.80

n.s.

13.06

n.s.

R²(Nagelkerke)

0.08

0.10

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p <

0.01, *: p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Table IVd. Endogeneity tests: 2SLS regressions

ROA

Total incomes (in

thousands)

Grants (in thousands)

Donations and

memberships (in

thousands)

Constant

0.00

(0.04)

-49,153

(23,934)

-21,709

(11,139)

-6,948

(2,711)

ADI

0.08

(0.10)

200,461

(60,870)

83,633

(28,258)

29,949

***

(6,896)

118

158

157

158

0.23

n.s.

10.84

***

8.76

18.86

***

R²

0.01

0.07

0.05

0.11

Ajusted R²

0.00

0.06

0.05

0.10

Source: Table created by author. Reading: ***: p < 0.001, **: p < 0.01, *: p < 0.05 and

^: p < 0.10. SE: standard error; n.s.: not significant.

Employee training plan

Employment of

disadvantaged people

or with disabilities

Constant

0.44

***

(0.10)

0.12

(0.11)

ADI

0.75

(0.25)

0.71

(0.27)

160

9.08

6.65

R²

0.05

0.04

Ajusted R²

0.05

0.03

Source: Table created by author. Reading: ***: p < 0.001, **: p < 0.01, *: p < 0.05 and

^: p < 0.10. SE: standard error; n.s.: not significant.

Environment

protection at

headquarters

Environment

protection in the

field

Sustainability

Constant

1.53

***

(0.33)

1.41

***

(0.33)

0.40

***

(0.11)

ADI

0.12

(0.85)

-0.17

(0.85)

0.42

(0.28)

160

0.02

n.s.

0.04

n.s.

2.27

n.s.

R²

0.00

0.01

Ajusted R²

0.00

Source: Table created by author. Reading: ***: p < 0.001, **: p < 0.01, *: p < 0.05 and

^: p < 0.10. SE: standard error; n.s.: not significant.

Appendix A: First robustness check

Sub-sample including NPOs with national activities

OLS regressions of financial effectiveness indicators

ROA

Total incomes (in

thousands)

Grants (in thousands)

Donations and

memberships (in

thousands)

Constant

-0.02

(0.04)

-49,119

(27,866)

-26,074

(15,250)

-5,698

(3,625)

ADI

0.19

(0.23)

170,499

(151,020)

134,238

(82,651)

2,404

(19,650)

ADI – FA

-0.12

(0.15)

150,200

(93,598)

12,796

(51,224)

21,669

(12,179)

ADI – OA

0.01

(0.15)

385,470

***

(99,247)

89,526

(54,316)

22,072

(12,914)

ADI – DA

0.02

(0.12)

21,843

(79,694)

645

(43,615)

-4,812

(10,369)

ADI – MA

0.00

(0.14)

-176,770

(91,845)

-64,255

(50,265)

5,089

(11,950)

0.49

n.s.

9.41

***

3.10

4.08

***

R²

0.03

0.34

0.15

0.18

Ajusted R²

0.00

0.31

0.10

0.14

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of social effectiveness indicators

Employee training plan

Employment of

disadvantaged people

or with disabilities

Constant

-0.28

(0.31)

-0.59

(0.29)

ADI

1.12

(1.69)

-2.52

(1.59)

ADI – FA

-0.71

(1.17)

0.32

(1.03)

ADI – OA

1.35

(1.19)

2.39

(1.04)

ADI – DA

0.54

(1.04)

1.42

(0.90)

ADI – MA

0.92

(1.12)

1.55

(1.00)

129

-2 Log(Likelihood)

14.03

***

17.31

R²(Nagelkerke)

0.15

0.17

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of environmental effectiveness indicators

Environment

protection at

headquarters

Environment

protection in the

field

Sustainability

Constant

-0.24

(0.28)

-0.33

(0.29)

-0.77

(0.30)

ADI

1.34

(1.51)

0.44

(1.52)

3.67

(1.57)

ADI – FA

-1.00

(0.99)

-1.57

(1.02)

0.22

(1.00)

ADI – OA

0.37

(0.94)

0.03

(0.95)

0.32

(0.96)

ADI – DA

-0.48

(0.86)

0.50

(0.89)

-1.30

(0.89)

ADI – MA

-0.09

(0.95)

0.26

(0.96)

-1.14

(0.98)

129

-2 Log(Likelihood)

2.82

n.s.

2.73

n.s.

12.1

R²(Nagelkerke)

0.03

0.12

Nota: Although insufficient, the result is consistent with hypothesis H3 in the case of

sustainability in France. This confirms the complexity of our subject.

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Appendix B: Second robustness check

Sub-sample including NPOs belonging to a network or a federation

OLS regressions of financial effectiveness indicators

ROA

Total incomes (in

thousands)

Grants (in thousands)

Donations and

memberships (in

thousands)

Constant

-0.02

(0.04)

-58,796

(34,110)

-33,998

(19,074)

-4,371

(3,360)

ADI

0.18

(0.19)

343,398

(167,069)

207,356

(93,425)

25,775

(16,460)

ADI – FA

-0.02

(0.11)

6,726

(99,193)

-37,929

(55,468)

6,233

(9,772)

ADI – OA

-0.06

(0.12)

459,662

***

(107,802)

119,382

(60,283)

27,385

(10,621)

ADI – DA

-0.03

(0.12)

61,623

(101,766)

7,863

(56,907)

6,406

(10,026)

ADI – MA

-0.04

(0.12)

-256,966

(104,671)

-92,950

(58,532)

-14,944

(10,312)

0.31

n.s.

9.78

***

3.50

***

6.21

***

R²

0.02

0.39

0.19

0.28

Ajusted R²

0.00

0.35

0.13

0.24

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of social effectiveness indicators

Employee training plan

Employment of

disadvantaged people

or with disabilities

Constant

-0.07

(0.36)

-0.82

(0.34)

ADI

0.49

(1.83)

-0.46

(1.62)

ADI – FA

0.23

(1.24)

0.17

(1.02)

ADI – OA

1.24

(1.28)

2.56

(1.05)

ADI – DA

0.01

(1.23)

0.09

(1.02)

ADI – MA

0.99

(1.28)

0.58

(1.07)

115

-2 Log(Likelihood)

8.38

n.s.

11.37

R²(Nagelkerke)

0.11

0.13

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of environmental effectiveness indicators

Environment

protection at

headquarters

Environment

protection in the

field

Sustainability

Constant

-0.15

(0.32)

-0.18

(0.33)

-0.54

(0.34)

ADI

1.02

(1.57)

-0.28

(1.57)

1.78

(1.68)

ADI – FA

-1.13

(1.00)

-1.07

(1.02)

-0.28

(1.07)

ADI – OA

0.51

(0.96)

0.40

(0.98)

1.60

(1.06)

ADI – DA

-0.26

(0.99)

-0.56

(1.02)

-2.21

(1.05)

ADI – MA

-0.09

(1.02)

0.78

(1.03)

0.43

(1.10)

115

-2 Log(Likelihood)

2.28

n.s.

3.36

n.s.

12.02

R²(Nagelkerke)

0.03

0.04

0.14

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Appendix C: Third robustness check

Sub-sample including NPOs without donor protection charter (“Trusted Donation

Charter” label)

OLS regressions of financial effectiveness indicators

ROA

Total incomes (in

thousands)

Grants (in thousands)

Donations and

memberships (in

thousands)

Constant

-0.03

(0.05)

-5,758

(4,516)

(1,171)

-528

(906)

ADI

0.14

(0.28)

-2,445

(25,829)

16,377

(6,698)

-3,190

(5,181)

ADI – FA

-0.10

(0.21)

7,295

(19,086)

-8,799

(4,949)

4,617

(3,828)

ADI – OA

0.06

(0.19)

15,803

(17,562)

6,917

(4,554)

-8,140

(3,523)

ADI – DA

0.00

(0.16)

14,767

(14,305)

8,148

(3,709)

6,607

(2,869)

ADI – MA

0.09

(0.20)

17,243

(17,927)

-10,011

(4,649)

6,409

(3,596)

0.67

n.s.

2.63

2.89

4.23

R²

0.04

0.14

0.16

0.21

Ajusted R²

0.00

0.09

0.10

0.16

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of social effectiveness indicators

Employee training plan

Employment of

disadvantaged people

or with disabilities

Constant

-0.20

(0.31)

-0.32

(0.31)

ADI

3.70

(1.84)

-2.85

(1.86)

ADI – FA

-2.67

(1.32)

-0.55

(1.26)

ADI – OA

0.86

(1.16)

2.28

(1.10)

ADI – DA

1.33

(1.12)

2.61

(1.08)

ADI – MA

-0.88

(1.23)

0.80

(1.25)

118

-2 Log(Likelihood)

10.87

14.05

R²(Nagelkerke)

0.12

0.16

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

Probit regression of environmental effectiveness indicators

Environment

protection at

headquarters

Environment

protection in the

field

Sustainability

Constant

-0.01

(0.30)

-0.17

(0.30)

-0.29

(0.30)

ADI

2.37

(1.71)

-0.85

(1.67)

3.07

(1.73)

ADI – FA

-2.18

(1.25)

-0.55

(1.19)

-1.86

(1.28)

ADI – OA

0.77

(1.04)

0.28

(1.01)

0.74

(1.07)

ADI – DA

-0.37

(1.02)

-0.64

(1.02)

-1.71

(1.13)

ADI – MA

-1.17

(1.16)

1.21

(1.15)

-1.20

(1.18)

118

-2 Log(Likelihood)

5.14

n.s.

2.30

n.s.

8.61

n.s.

R²(Nagelkerke)

0.06

0.03

0.09

Source: Table created by author.

Reading: FA for fiduciary accountability, OA for organizational accountability, DA for

downward accountability, MA for managerial accountability. ***: p < 0.001, **: p < 0.01, *:

p < 0.05 and ^: p < 0.10. SE: standard error; n.s.: not significant.

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