How Nonprofits Became Corporate Puppets
These day, my life revolves around nonprofit work. So when I say that there’s something terribly wrong with the way nonprofits are funded, I’m speaking about a world that I’m very much a part of.
There are plenty of good organizations. People doing difficult and very necessary work. People who know their communities, understand the problems, and push forward, even when there’s barely enough money to keep the doors open.
And then there are organizations that seem to have no difficulty getting funded, though it can be remarkably difficult to figure out what they’ve actually accomplished. Often times actually, the better funded the organization, the harder it is to figure out what they do just by looking at their website.
And I think it’s time to debunk the common belief that money naturally finds its way to the people doing the most good.
Because it doesn’t. I mean… it REALLY doesn’t.
To understand how we got here, we have to look back at what happened when movements for change became dependent on the institutions they were trying to change. Nonprofits existed long before the 1960s. But that decade brought movements driven by passionate beliefs about civil rights, poverty, war, and the kind of society people wanted to live in. People organized because something was wrong and they wanted to do something about it. They were willing to make demands, upset people, and challenge power.
But… a movement that challenges power presents a problem for the people who have that power. They can resist the movement, of course. More commonly, though, they simply fund the parts they find acceptable, help those parts grow, and leave the more threatening parts struggling to survive. And, over time, the funded organizations become the recognized voices. They get invited to the meetings. They acquire staff, offices, influence, and the ability to speak on behalf of people who may have very little say in what’s being said.
The movement still exists. But someone else has acquired considerable influence over its direction.
This is one of the central concerns in The Revolution Will Not Be Funded, the essay collection edited by INCITE! Its contributors examine how corporate wealth, foundations, and government can redirect social movements through the organizations that depend on their money. The nonprofit industrial complex is the name they give to those relationships.
And this didn’t suddenly begin in the sixties. Political scientist Megan Ming Francis argues that foundation funding helped redirect the NAACP’s earlier work away from racial violence toward education litigation. Of course, education mattered enormously. But the question is; who had the power to decide which urgent problem would receive the resources. And that’s the real issue here…
Social engineering.
Powerful interests deciding which efforts get funded and which are left to struggle. Governments, corporations, foundations, and wealthy donors shaping the direction of social change by financing the causes, organizations, and approaches that serve their priorities. They don’t have to issue orders. A grant requirement here, a funding restriction there, and organizations begin adjusting their work to keep the money coming. Community needs become whatever fits the funding criteria. And over time, the people experiencing the problem can lose influence to the people paying for the response. What looks like a movement from the ground up can become a managed process, with enough change to demonstrate progress and enough restraint to protect the interests financing it.
But this is nothing new.
You want to change something. Someone offers to help pay for the work. There are conditions, but they seem reasonable. You accept them because you need the money. Eventually you have employees whose livelihoods depend on the next grant, and people whose services depend on those employees.
Now try telling the funder something they don’t want to hear.
INCITE! describes being offered a $100,000 grant by the Ford Foundation in 2004, then having the offer withdrawn because of its support for an uncomfortable political view. Whatever someone thinks about that political position, the financial relationship is plain enough. An organization’s position on an issue could determine whether the promised support remained available. How often does an organization have to experience that before it learns to anticipate the objection? Probably not very often.
That’s what troubles me about calling this philanthropy; as though the word explains the whole arrangement. Money can help people. It can also buy influence over the people who are supposed to be helping. And a corporation can support a charitable cause while continuing to lobby for policies that make that cause necessary in the first place. The donation gets a photograph. The lobbying gets a result. Meanwhile, the nonprofit has a sponsor to thank — be indebted to, rather.
I don’t believe every funder is doing this deliberately, or that every funded organization has surrendered its purpose. Good people work throughout this crooked system. But a system can reward obedience without ever putting the word obedience in the application. It can reward organizations that describe problems in convenient ways. Organizations that promise manageable improvements. Organizations whose leadership knows the right people and understands which questions not to ask.
Those organizations can become very successful at being nonprofits. Whether they’re successful at changing anything is another question.
Giving USA estimates that Americans gave more than $617 billion to charity in 2025 — which includes giving to many kinds of institutions — but it tells us nothing, by itself, about how effectively the money was used. It does, however, make the familiar claim that “there simply isn’t enough money available” rather difficult to accept without asking some obvious questions: There seems to be enough money, but… Who gets it? Who decides? And what, exactly, is being bought with it?
What I see in nonprofit work is a troubling gap between usefulness and funding. Organizations doing the direct work can remain chronically short of resources while better-connected organizations keep acquiring them. Then we’re told the smaller organization needs to build its capacity. Improve its messaging. Hire someone to write grants.
With what money?
This can become an elaborate shell game. Money passes through institutions, partnerships, initiatives, and intermediaries. There are meetings about the work, reports about the work, and announcements about the money allocated to the work. Somewhere at the end of all that is a person who still needs help.
The money can be accounted for perfectly while the purpose gets lost.
Of course administration is necessary. Coordination is necessary. But there has to be a point at which we ask whether all this activity is producing something worth its cost. Being able to explain where the money went should be the beginning of accountability, not an end in itself. We don’t need endless shuffling of money… we need results.
I recently wrote The Organization Is the Grant Proposal, arguing that organizations should develop real solutions rather than continually reshape themselves around funding opportunities. I believe that’s necessary. But I also recognize its limitation: doing useful work doesn’t guarantee that the people controlling the money want to fund it. Especially if the work gives ordinary people more power to question things.
And that leaves good nonprofits in an ugly position. They need resources to do the work, but the people holding those resources may prefer a version of the work that changes very little about the status quo. And this is why the nonprofit industrial complex deserves criticism from people inside nonprofit work… We know how much good could be done with resources that never reach the people capable of doing it. We know what it costs to keep working without them.
The organizations still driven by conviction shouldn’t have to become corporate puppets to survive. They should be getting the money.
And the people holding the money should have to answer for why they aren’t.
