Why Indian nonprofits are losing talent | Mint

Why Indian nonprofits are losing talent

Though the talent pool has improved in recent years, the sector still finds it hard to manage hires. Illustration: Ashish Asthana/Mint
Though the talent pool has improved in recent years, the sector still finds it hard to manage hires. Illustration: Ashish Asthana/Mint


Organizations working at the intersection of technology and society face the challenge of talent attraction and attrition most severely.

Prem Sameer seems like a regular guy, with an interest in football and technology. His desire to do something different in life led him to take up a job with a nonprofit. Things were hunky-dory for a bit.

“The first two years were good even though the money I was making was far less than I would have made in the corporate sector. I had a purpose. There was a clear work-life balance," reflects Sameer, who worked at a Bengaluru-based education and skilling nonprofit for close to three years until October. The organization works with industrial and vocational training institutes to improve the computational skills of youth and adolescents.

Things started feeling different in the third year, he says.

“I was not happy with the pace at which we were moving. I was not quite sure of the impact we were making, if we were able to solve the problem (of unemployment) in a real sense," he adds. He now works as product manager at a technology startup, Sekel Tech.

Sameer’s story is not unique. In the last few years, many millennials found refuge, at least for a while, with social sector organizations in their endeavour to seek meaning in work.

Aishwarya Chaturvedi, too, had a brief stint in the sector between 2017 and 2019, first at a Gurugram-based fellowship, and later at a Delhi-based think tank. At the latter, he was assigned an agriculture project that aimed to help farmers earn their fair share through better price realization. He appreciated the ambitious vision but started getting tired of hearing “we are in this for a long haul". Chaturvedi was eventually left dispirited by the lack of clear short-term goals, and the dearth of accountability.

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Initially, the attraction was mutual. The sector became more vibrant than ever during the last decade or so for a number of reasons.

The legislation of corporate social responsibility (CSR) not just increased the fund flow for the sector but also brought corporate influence with it. There was also an increase in the availability of philanthropic money on account of pledges and donations by high net-worth individuals (HNIs). The CSR funds almost doubled in four years to 25,715 crore in 2020-21, shows government data. HNI donations more than doubled between 2018 and 2022, according to a Hurun report. The Bengaluru-based education nonprofit, for example, received a grant from Accenture CSR, among others, for the project Sameer worked on.

With the fresh funds came a demand for more professionalism and higher efficiency which were typically not associated with nonprofits. The approach is visible in the new-age social sector organizations and fellowships—such as Acumen, Central Square Foundation, Gandhi Fellowship, Teach for India, and The/Nudge Institute, to name a few—that received talent from premier colleges. For instance, Sameer is a graduate of the National Institute of Technology, Surathkal, and has a Master’s in design from Srishti Manipal Institute of Art, Design & Technology.

Though the talent pool has improved in recent years, the sector still finds it hard to manage hires. A 2019 study by Dasra, an impact philanthropic organization, revealed that talent management was the second biggest challenge for nonprofits, only slightly behind inadequate funding. A 2022 study by the Indian School of Development Management (ISDM) and the Centre for Social Impact and Philanthropy at Ashoka University (CSIP), that covered 100 organizations, also found that limited size and quality of talent pool is a persistent problem for them.

“Organizations working at the intersection of technology and society face the challenge of talent attraction and attrition most severely," says Satender Rana, an ISDM researcher. Sameer’s role at Bangalore-based education and skilling nonprofit was at a point where technology and society meet. During his tenure, the organization lost good people such as data scientists, user experience researchers, and designers, he says.

Problems Galore

I understand that the social sector problems are complex, there is a need for mindset change, realignment of various stakeholders, which requires time. But you still need to define some goals," Chaturvedi says. In the business world, corporates invest money, and demand a return against this investment. “In the social sector, too, funds are raised on a quarterly or yearly basis, so there has to be a way to measure the performance against that," he adds.

Sameer had his own take on problem solving by nonprofits. “Organizations start off with solving a big problem, but as they grow, they settle for low effort, high impact (as defined by their impact metrics) problems," he says. So, the actual problem which they intended to solve may never really get solved. It is tied to the cycles and mandates of funding, too.

Ravi Sreedharan, one of the founders of ISDM, points out the gaps in understanding how social change works among many who get impatient with the pace at which things move. “There can be some early successes, but change does take time," he says. “So we have to figure out how to build accountability, recognizing that while short-term vision is dangerous, long-term hides inefficiencies." Also, youngsters need to know that it takes time, he says.  

Job or Career

Shantanu Gharpure worked at A.T.E. Chandra Foundation on various agriculture projects for more than three years before he went for an MBA at the Indian School of Business (ISB). After graduation, he has been working at an agritech startup for the last six months. For him, the decision to go to ISB was to open up more opportunities, which would not have happened, he thinks, had he stayed in the sector.

At the Foundation, he came across a number of senior professionals who had come from the corporate world and exhibited skills such as fundraising, and communications. They had their networks. He, too, wanted to acquire similar skills. A business school was the place for him if he wanted to “go beyond" his present situation, he says.

Another constraint for high-performing individuals is that most nonprofits do not offer long-term career options. Often, employment is tied to projects with a fixed timeline. The association between a professional and an organization ends with the conclusion of a project. The contrast between a job and a career is glaring.

Very few organizations invest with a focus on creating suitable opportunities for career progression and role transition for their talent pool, according to the ISDM-CSIP study.

Pranay Patil, who is pursuing a Master’s in public policy at Harvard University, agrees with the findings. “It is very difficult to ascertain the kind of work and role one is going to get after five years," he says. Patil worked as a consultant for about six years in organizations such as the National Health Authority and Asian Development Bank before leaving for higher studies. He made the decision with an eye on expanding his career opportunities to other sectors as well.

Not all is doom and gloom, however. There are professionals who are upbeat about the talent flow into nonprofits. Praveen Khanghta, associate director at the Convergence Foundation (a grant-making incubator), has been in the sector for 11 years now. Is the sector able to show a career trajectory to new entrants? “My answer is a cautious yes. The opportunities in the impact sector have increased over the years. The work that consultants like E&Y do with the government, the various government fellowships, are all part of the broader impact sector."

Khanghta is optimistic about the future for mid-career professionals. They can go on to lead nonprofits, work in foundations and CSRs, support the government, or even work for the government. But, he agrees that the sector under-prioritizes and underspends on learning and development, capacity building, and upskilling—key to career growth.

Lack of Moolah

It’s no secret that the social sector is unable to attract talent in the first place because of lower remuneration. Compensation levels in social sector organizations are less than half the general industry levels, according to the ISDM-CSIP study. Unimpressive pay perks are also the most cited reason by those who exit the sector, says Neha Nimble, lead researcher of the study.

Atul Satija, the founder of The/Nudge Institute, a nonprofit that works on livelihood opportunities, makes a provocative point. If Bangladesh’s biggest nonprofit, BRAC, has an annual budget of $1 billion, why can’t India have a $5-10 billion nonprofit given the size of our problems? The largest here is a mere 400-crore one. The poor budgets of nonprofits have a bearing on the compensation structure, discouraging the best talent from choosing them as a career option. The salaries in the social sector are two-three times higher in Africa and Bangladesh, he adds.

So long as the funding landscape of nonprofits does not improve, this problem will persist. Foreign aid from multilateral institutions does not go to nonprofits in India but to the government. And domestic philanthropy from HNIs is still in its infancy. So, CSR is the only sizeable source of funds, Satija says.

In recent years, the government has tightened the Foreign Contribution (Regulation) Act, 2010, adversely impacting the fund flow to nonprofits under this route.

Rewards need to be looked at holistically—money for sure, but also other things like meaning, purpose, culture, integrity, alignment to desired life. This will also eliminate the petty competition and rat race that one could unwittingly end up in, Sreedharan says.

To further complicate issues, there is the entry of startups into the picture which lure the best and brightest away from the sector. Though Sreedharan’s words give us a peek into the lofty purpose of the social sector, on the ground, money talks. And it’s taking talent from nonprofits into the startup universe —Chaturvedi, Sameer and Gharpure being the cases in point.

The trio view their shift differently. Sameer would like to come back to the social sector once he starts feeling the burnout, whereas Gharpure and Chaturvedi have widened their idea of impact. They no longer think that common good cannot be created at a for-profit organization.

What works

An organization needs to keep staff engaged with meaningful work or projects, increase opportunities to work with diverse stakeholders independently, and have a clear succession path, says Nupur Bhargava, human resources advisor at Central Square Foundation, an education nonprofit.

A smaller NGO called Community Development Centre, working with the tribal population in Madhya Pradesh, has an innovative solution to the problem—it only hires from the local population, and invests in skilling, to minimise attrition. Hiring from the local talent pool is not just less expensive but they are also more emotionally invested in the project, and would not like to move out after spending a few years. 

 The/Nudge Institute has tripled its headcount to 350 in the last few years. Atul Mishra, head of people and culture at the nonprofit, has a way to tackle the people challenge. “If you are able to figure out the right persona for a role, it helps," he says. A nonprofit, for instance, may look at hiring someone with a successful career in startups—they could be financially secure, thanks to esops (employee stock ownership plans). “We also target double-income families, where one of the partners is in the for-profit world," he adds.

The other interesting pool is returning non-resident Indians. “We have hired people who had spent a decade or so in the US or the UK, and had enough savings to opt for a nonprofit role," he says.

So while things are improving, there’s still a long way to go before nonprofits find talent gravitating towards them. Moreover, the sector will continue to face stiff competition from startups on this count.

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