27 Chapter A New Third Sector Intellectual Capital Model Graziella Sicoli University of Calabria, Italy Bronzetti Giovanni University of Calabria, Italy Franco Ernesto Rubino University of Calabria, Italy Rija Maurizio University of Calabria, Italy Paolo Tenuta University of Calabria, Italy ABSTRACT The Intellectual Capital (IC) report has become a fundamental tool in the disclosure of non-profit activities, since it is necessary to use a correct framework to represent IC To achieve the aim of the paper the work is developed as follows: the existing literature on non-profit organizations (NPOs) and IC is examined and relevant aspects to be measured by IC indicators and disclosed by an IC report in the above context are brought into focus Then extant frameworks for IC reporting are outlined in order to verify whether they fit the aspects qualified as relevant in NPOs and it is pointed out what they lack with reference to the NPOs context The aim of the paper is to propose an original framework containing a new set of indicators The proposed framework is tested in an Italian NPO The result is to disclose new aspects of activity carried out by NPOs involving knowledge, skill and their relationship with the surrounding community INTRODUCTION1 The importance of intangibles and among these of intellectual capital (henceforth IC) in the non-profit sector (henceforth NPOs), generates the need to measure its role in the value creation process In fact, in contrast with what happens in the for-profit sectors, where everything is measured quantitatively, in the non-profit sector the importance of communicating and demonstrating to stakeholders the quality of services provided (Stewart, 1997) with respect to other public or private subjects is determinant in DOI: 10.4018/978-1-4666-9455-2.ch002 Copyright © 2016, IGI Global Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited A New Third Sector Intellectual Capital Model generating social value NPOs are the sum of private, voluntary, and non-profit organizations and associations The term describes a set of organizations and activities alongside the institutional complexes of government, state, or public sector on the one hand, and the for-profit or business sector on the other The “third sector,” has become a major economic and social force (Cohen, 2007; Kong & Thomas, 2006) A recent study (Kong & Prior, 2008) indicates that the role of IC in NPOs is more critical than in the private sector due to the fact that intangibility is even more present than in the case of private organizations in terms of their goals production processes, focused on human capital and output (Ramirez, 2010) Intellectual capital (IC) is one of the key determinants of companies’ business performance (Schiuma, et al., 2007) In service organizations and therefore in the NPOs the role of IC is crucial because the outcome of activities is heavily based on, e.g the efforts of skilled personnel, fluent processes and other intangible factors, whereas the role of tangible resources such as machines is not as important (Kujansivu & Lonnqvist, 2009) Several studies indicate that unique or scarce resources affect firm performance (Barney, 1991; Castrogiovanni, 1991; Grant, 1991; Mahoney, 1995; Nahapiet & Ghoshal, 1998; Pfeffer & Salancik, 1978; Tsai & Ghoshal, 1998) For instance, Barney (Barney, 1991) suggests that NPOs have a competitive advantage when their assets, capabilities or processes possess specific attributes That is, when assets, capabilities or processes are rare, valuable, difficult to imitate, and have few substitutes, they are a critical source of competitive advantage In this context are IC studies proposed as a novel managerial approach in NPOs (Kong, 2007a; Kong, 2009; Kong & Prior, 2008) In companies the significance of IC is acknowledged and several frameworks for managing and developing IC have been introduced (Kujansivu, 2008) However, the issue is relatively new to NPOs (Kong, 2008) Thus there are many open questions There is also a lack of empirical research on the topic because only a few empirical studies have been carried out (Fletcher, et al., 2003; Kong, 2007b) This paper builds on the few studies conducted so far and examines how IC could be taken into account in NPOs A brief review of the national and international literature on IC follows, which suggests that IC can be utilised as a competent strategic management conceptual framework in NPOs IC is an important resource that NPOs need to develop in order to gain sustained strategic advantages The research is focused on building an original IC framework through a set of indicators useful for disclosing IC in the NPOs context Then the model is tested on an existing Italian NPOs which offers a new disclosure of activity carried out by the organization involving knowledge, skills and its relationship with the surrounding community The findings appear to suggest an innovative IC framework model for NPOs with a significant set of indicators This work contributes to the study of the IC report in different ways Firstly, it contributes also to shifting the attention of IC research from “What is IC?’’ to ‘‘How is IC implemented?’’ in order not to take for granted the role of IC at organizational level, but instead to unveil its role in a specific and complex firm context: the NPOs Secondly, it points out with conviction the opportuneness of applying the IC report in voluntary organisations since it is a useful tool, both internally to sustain knowledge management and externally as a communication tool to stakeholders about how the ONP works in terms of objectives pursued, actions achieved and results obtained The work allows the NPOs to understand the benefits of this new accounting tool In fact, by means of the IC report, every NPOs is able to monitor the potential present within it through a set of indicators on CI (indicators of efficiency, effectiveness and stability) transparent and useful to supply information 28 A New Third Sector Intellectual Capital Model on the strategic patrimony of the organisation itself in terms of human, reporting and organisational capital The NPOs have to interpret the IC report tool as a means of dialogue and communication with both internal and external stakeholders to install a direct relationship with them THE THIRD SECTOR The third sector, which includes a variety of different organizations and associations, is active in many areas of the economy ranging from healthcare, social services, employment and culture to environment (OECD, 2003) Compared with private companies NPOs are value-driven, instead of profit-driven and offer not only services for clients but also often community work, training and engaging volunteers as part of the service staff, for empowerment or to foster a religious approach (Borzaga & Santuari, 2003) NPOs are increasingly involved in welfare, health care, education reform, and public–private partnerships and rural and urban planners use nonprofit and community organizations for local development and regeneration The full recognition of the immensely elevated position and role of NPOs at the beginning of the twenty-first century is the main difference from the latter part of the previous century, when non-profit organizations were “(re)discovered” as providers of human services in a welfare state context NPOs are now seen as a part of the wider civil society and welfare systems of modern societies The non-profit phenomenon has grown not only because of the crisis of the Welfare State, but also because of a variety of factors, among which we can include: economic development as well as rising incomes, which has led to an increase in activity as a result of voluntary and charitable initiatives, the emergence of new needs and the different and specific services, increasing employment and economic growth in this sector This situation has been favoured by the spontaneity and goodwill of many citizens, who have joined together in groups (associations, cooperatives etc.) in order to provide answers to serious social problems (Chaminade & Catasus, 2007) According to the last Italian census of 2011 there are about 301,191 NPOs active in Italy with an inhomogeneous distribution on the territory North Italy accounts for 55.2% NPOs, 21.5% are in the Centre and 16.6% in the South The rate per person is 38.4% for every 10,000 people The indicator per resident indicates that in Italy 38.4% NPOs for every 10,000 people are active Today, NPOs regularly find themselves sharing the same territory with for-profit organizations, sometimes as collaborators, but probably more often as competitors (Ryan, 1999) NPOs are now expected to adopt for-profit competitive strategy approaches (Weerawardena & Sullivan-Mort, 2001) An NPOs gains competitive advantage when it consistently outperforms its competitors, although this performance is not measured in the same way as it is in for-profit organisations Today, physical assets and financial capital are no longer the primary resources that facilitate competitive advantage instead intangible and IC resources ensure competitive advantage (Kaplan & Norton, 2001; Wall, et al., 2004) Nowadays, the role and contribution of NPOs are more important and strategic The performance measurement models that have been developed tend to be applied to profit-oriented organizations, whereas performance measurement models based on the characteristics of NPOs are still relatively limited This limitation leads to inadequacy in the stage of identifying and determining the aspects of NPOs interaction with internal and external parties that demand superior capabilities (the need for a knowledge-based 29 A New Third Sector Intellectual Capital Model organization) While there are difficulties in developing a mechanism to quantify elements of intangible assets, is precisely the intangible leading indicators that one expects to perform a quantitative valuation of organizational performance achievement This constructive research is aimed to develop a performance measurement model according to the characteristics of NPOs based on intellectual capital The fundamental difference between NPOs and for-Profit Organizations is focused on the main reason for the establishment of the organization Simply, it is possible to say that the main purpose of Profit Organizations is to create financial advantages for its shareholders through profits from the goods/services traded On the other hand, the main purpose of NPOs is to meet the social needs of a community or of its members In return, the NPOs not only provide services that are owned but also need to consider all the consequences arising from the services they offer LITERATURE REVIEW The definition of IC has been the object of discussion by both academics and businessmen In general, all major authors share the idea that intellectual capital can be divided into three categories: human capital, structural capital and relational capital, as defined by Bontis’s model (1998) Although the labels used to identify categories in which intellectual capital can be classified are different for different authors, the content of these categories is more or less similar (Bontis, et.al; 2000) According to Bontis (2002), Daum (2003), Vaškelienė (2003), Hitchner (2006), Fitz-enz (2009), and Dubra (2010), human capital is perceived as the entirety of knowledge, skills, education, experience, talent, innovativeness, competence, motivation, loyalty, creativity, ability to perform a task and deal with arising issues, leadership, business skills, management and ideas leading to new products of the staff of an enterprise It also covers the value, culture, and philosophy of the enterprise This capital is denoted by its not belonging to the enterprise Claims are produced that this capital is one of the core and most influential resources of the enterprise in competitiveness as the ability of the enterprise to compete in the market is determined by the knowledge and skills amassed by its staff, i.e by the efficiency of the human capital According to Bontis (2002), Daum (2003), Vaškelienė (2003), Hitchner (2006), organizational capital is perceived as the organizational and financial structure of an enterprise, its strategic processes, technologies, procedures, process documentation, risk assessment methodology, technical equipment, software, systems, the use of information technologies, databases (e.g., the ones covering information on the market and clients), patents, trademarks, methods of sales management, communication systems and all other organizational capabilities supporting the productivity of the personnel and facilitating their productive cooperation A claim may be produced that it covers the technologies, methodologies and processes that enable the functioning of the enterprise In other words, it remains “inside” the enterprise after the completion of a work day when the staff has left Differently from human capital, this type of capital may belong to the enterprise, and the enterprise may thus handle it This capital is considered the second most important capital of an enterprise after human capital According to Bontis (2002), Daum (2003), Vaškelienė (2003) and Fitz-enz (2009), relational capital is conceived as the awareness of the enterprise, its trademarks, brands, image, external networks and complete orders, its supply streams, long-term contracts, license and franchise agreements and relations with external individuals founding the marketing and commercial capabilities of the enterprise In this context, external individuals include not only clients/consumers, but also business partners, suppliers, and regulatory institutions 30 A New Third Sector Intellectual Capital Model According to Maditinos, et al (2011), only by nurturing intellectual capital organizations will they be able to remain competitive, fight against the severe competition (both domestic and foreign), and create sustainable competitive advantages That is why organizations need to evaluate their intellectual capital and its components, and monitor their development and performance The reference structure of the IC report, according to the Meritum project must include three parts: the firm’s vision, which is a narrative of firms strategic aims and critical intangibles, a brief summary of intangibles resources and intangible activities, visualized under the three IC categories, which must be developed to reach strategic aims and a system of indicators to allow the reader to judge whether the firm’s behaviour is coherent with strategic aims (Veltri, 2007) The three components, human, structural and relational capital, are not independent, but complementary and are not intended to interfere with the economic objectives, but to instil an ethical content to the financial decisions, which contributes to the protection of the environment and a better society Typically, IC has been studied through the lens of the private sector but this fact does not render the concept of IC or the importance of IC reporting less valuable for non-profit sector settings The strategic importance of the IC is that the NPOs have developed new forms of reporting both in the interest of communicating to stakeholders their commitment to the reconciliation of their instances, and the need for tools to support the management in respect of the stakeholder view (Baur & Fenn, 1972; Mathewes, 1993; Gray, et al; 1996) INTELLECTUAL CAPITAL AND NON-PROFIT ORGANIZATIONS Among the few studies on the Intellectual Capital Report (ICR) in NPOs, we must cite the research of Fletcher et al (Fletcher et al, 2003), focused on the intellectual capital of the Australian Red Cross Blood Service (ARCBS), a complex non-profit organization providing specialized services in the health industry, which belongs to this kind of study The main research aim was to understand better the value that ARCBS holds for its different stakeholders groups The value is represented in a comprehensive value hierarchy, which reports stakeholder perceptions of the relative importance of the Key Performance Areas (KPAs) of the value hierarchy and their constituent attributes (Chatzkel, 2002; Pike, et al., 2002) In 2009, Guthrie et al analysed the ICRs of ARCBS in the 2002-2005 three-year period to provide an assessment of ICR in NPOs through the content analysis methodology (Guthrie, et al., 2004) It was found that, unlike prior studies on corporate ICR, the amount of IC reporting at ARCBS is generally high, especially for certain IC elements (the reference is to the high incidence of innovation and R&D) Summarizing, ARCBS is an organization that has focused on and expended considerable effort on developing a stakeholder oriented IC report, but the IC reports not trace the process of value creation through R&D or, more generally, through IC (Guthrie, et al., 2009) Intellectual capital provides an overview of potential future NPOs and their ability to compete in the market, highlighting the strengths and weaknesses to be maintained or to be corrected to avoid critical situations IC helps to shift NPOs strategic focus to intellectual resources including knowledge, skills and experience This is important to NPOs because strategic activities and changes that are brought to the organisations will be mainly driven by internal initiatives by paid employees and volunteers rather than external forces such as government agencies 31 A New Third Sector Intellectual Capital Model Mouritsen, et al (2005) emphasise that IC is related to questions about identity, such as ‘who you are, and what you want to be’ and thus, IC is not merely an objective in relation to intellectual resources, but is an identity crafted around ability and knowledge of what an organisation can (Mouritsen et al., 2005; Roos, et al., 1997) As a result, the IC approach forces non-profit leaders to rethink their mission and their social raison d’être IC becomes important to NPOs not only because it helps the organisations to avoid goal displacement and resource diffusion, but it assists them to refocus their objectives on the social dimensions, which are sometimes distorted by operating in commercial contract environments under the public sector reform movement THE NO PROFIT ORGANIZATION SELECTION The CSV - Centro Servizi per il Volontariato (Voluntary Service Centre) – it is an NPO created on the indication supplied by the law on volunteers organization (L.266/91) and it is managed by Volontà Solidale, which is an association of non-profit societies that has the role to sustain, promote and develop voluntary activity in Italy In 2010, there were 9,409shareholders, with an average of 121 shareholders for CSV In Calabria, there are 481 shareholders, with an average of 96 for each centre CSV, financed by a Special Fund for Volunteers, has been active since 2003 with the basic principle “help and empowerment” to promote an active role of citizens in building an equal society and to guarantee the common wellbeing It gives value to volunteers and enables people in the Cosenza area to be volunteers In March 2014 it operated with 16 workers During 2013 the Cosenza area CSV recorded 608 NPOs The board is formed of 21 members who meet times a year It is clear, therefore, that the CSV supports the practical world of Volunteering through the provision of a number of different services; from basic services, promotion, advice and professional assistance, services, training, documentation, communication and social planning (Table 2) On 31/12/2012 the CSV filed 1,300 NPOs in the Cosenza area; among these 584 are related to law 266/91 (Volunteers’ NPOs), 432 Volunteers’ NPOs which work with CSV, 311 recorded in the regional volunteers NPOs register, and 250 work with CSV among those recorded in the regional volunteers NPOs register The components that characterize the intellectual capital in the Centro Servizi Volontariato (CSV) can be classified into three categories: Table Intellectual capital indicators Human Capital Structural Capital Relational Capital Growth and Renewal Skills Availability of the personnel to enhance their skills and from CSV to supply resources for growth CSV skill to generate new services CSV skill to keep its users and to find new ones Efficiency Skill to create new value Innovation skill with the minimum number of resources Customer satisfaction Stability Measure personnel loyalty and membership to CVS Trust of the internal personnel in the structure Measure the retention of old users Source: Our elaboration 32 A New Third Sector Intellectual Capital Model Table Human capital indicators 2012 2013 Employees 13 13 Part-time 13 13 With degree 11 11 High school instruction 2 Master 1 Literature studies 1 Scientific studies 12 12 Software knowledge 1 Female gender 10 10 Women with important roles 2 Number of training days 2 40 40 1 Growth and Renewal Capability PHD Languages Average age Efficiency Coordinators Administrators 1 Number front office workers 4 Number of specialized workers 7 Personnel with multiple role 12 12 Personnel with single role 1 Network between personnel 4 Leadership 4 (scale 1/5) Problem solving 4 Skills 5 Average age 40 40 Average age in top position 50 50 100% 100% 8 Customer satisfaction 5 NPO loyalty 5 Stability Permanence in the work CSV experience (scale 1/5) Source: Our elaboration 33 A New Third Sector Intellectual Capital Model Human Capital: Consists of the knowledge, skills, knowledge, experience, skills that are embedded in the human system of NPOs It is a capital that cannot be owned by anyone outside of the person who owns it Therefore, to maintain some success for each NPO it is necessary for the association to take action to motivate and involve volunteers to enforce their involvement with the NPO in which they operate The ability to attract and retain competent and motivated people, more efficiently than organization for profit, is the principal source of competitive advantage (Mauritsen, et al.; 2005) As far as possible it is important to convert human capital into structural capital through the sharing of expertise and experience; Organizational Capital: Expressive of knowledge possessed by the structured and shared (database, procedures, software, manuals, etc ) from which springs the corporate culture and with whom it describes the modus operandi of the NPOs, consists of all those elements, tangible and intangible, that support volunteers in their job In particular, the organizational structure and operating procedures are the frame of reference for the proper functioning of a company, since they define the subdivision of activities and the exact methodology to be used in the work performance (Joia, 2000); Relational Capital: Represented by the set of relationships that develop between the NPOs and the local community of reference (individuals, associations, businesses and other stakeholders that will work with the agency These reports result in a number of different intangibles: consider, for example, reputation, credibility, the social consensus and so on (Ordonez de Pablos, 2004) All these three components of intellectual capital need to be managed as a single unit so as such it triggers a virtuous cycle that leads to an increase in knowledge that, in turn, is a source of value creation for every NPO Peppard and Rylander (2001b) argue that IC resources can be utilised simultaneously by many users in different locations at the same time and thereby, are non-competitive in an economic sense The non-competitive characteristic of IC is important to NPOs because IC may encourage resource sharing rather than resource competition METHODOLOGY/RESEARCH FRAMEWORK The research is in two parts: the first is theoretical on NPO characteristics and analyses organizations and dimension using the most recent national Istat census; then IC is applied to the world of NPOs The second part is empirical: it analyses a case study and elaborates a new IC framework (Oronez de Pablos & Edvinsson, 2014) The second part has two steps: first of all, a quantitative analysis is made on IC reports available on line for NPOs and particularly for Volunteers’ NPOs From on-line data there is clearly a very small number of NPOs which disclose an intangible report in general and an IC report in particular IC management is almost unknown among Italian NPOs: according to the literature, in Italy there have only been recorded two cases of NPOs that have assessed their IC (Bronzetti & Veltri, 2007; Ordonez de Pablos, 2004)) For this reason we take into account the IC reports of for-profit organizations as well as those indicators that can be extrapolated and implemented to represent and improve NPOs communication On this basis a new IC framework has been built with indicators of the three IC areas: human capital, structural capital and relational capital again divided into growing, efficiency and stability indicators 34 A New Third Sector Intellectual Capital Model The CSV of the province of Cosenza was chosen as a case study as it was necessary to obtain objective information on services supplied and the social impact on the NPO examined The CSV is a benchmark for all NPOs operating in the area; to set up a new IC framework in the CSV of the province of Cosenza could facilitate the adoption of the instrument in the area The new IC framework is set up on the basis of the Sveiby Intangible Assets Monitor (2001), already adopted in other structures SCOPE OF THE RESEARCH A new framework to be used from all NPOs The new IC framework is the main tool for NPOs to aid strategic planning of the knowledge, internal and external, communication with stakeholders about services offered and resources available Past studies on NPOs showed the awareness and the perceptions of the non-profit sector regarding IC is not diffuse (Schneider & Samkin, 2008; Guthrie et al., 2009) The non-profit sector registers a delay in awareness on the strategic relevance of IC to create and manage knowledge to enhance organizational value and the lack of specific IC management models tailored on non-profit organizations Until now, research and studies on IC have been mainly developed and used by for-profit organizations Fewer were focused on non-profit organizations (NPOs), in spite of the fact that since the early 1990s NPOs stand out as crucial actors in politics, economics and welfare systems (Salamon, et al., 1999) Kong (2007a, 2008) suggests that IC can be applied as a conceptual framework for effective strategic management of NPOs, since it does not have an economic nature and shifts strategic focus to intangible resources HYPOTHESES TESTING IC can be an effective tool for NPOs and, for CSV best suits its resources and products because it addresses intangible assets, which are the most important resources for NPOs We hypothesize that Italian CSV (like most NPOs) not use IC, but they might greatly benefit from using it to address their management challenges In particular, the following questions are examined: Which intangible resources are highlighted in the operations of the CSV? What are the existing practices regarding the managing of IC factors on the part of the CSV? What are the IC needs of management in these organizations? The aim was to gain from the informants a more concrete and detailed understanding of the role of IC in these organizations and the needs to manage IC An examination of the most important aspects follows HUMAN CAPITAL (HC) In CSV the HC is the most important and strategic asset of the organization The set of persons with their skills has remained steady in the years analysed 35 A New Third Sector Intellectual Capital Model Referring to the available growth and innovation indicator there are 13 workers Their profile is young, dynamic and with a good culture (11 graduates) There are more women than men with a good education An important indicator shows the training days and it has remained constant over the two year examined Given the training provided it was not considered necessary to develop new roles or introduce training programs for new personnel The organizational roles can be considered consolidated In addition, in 2013, there was a growth trend in the training courses organized in the area and a large number of volunteers involved and interested in it These indicators are a practical reaction to the needs of the territory and NPOs in the light of ongoing changes With reference to the efficiency indicator an involvement of employees in the various fields of activity of the CSV can be highlighted as well as a good network capability that helps to build a positive image of the organization which contributes to the achievement of a high level of satisfaction of the parties that are addressed to it With reference to the stability indicator the average age both of the Board and the staff has a very young trend The presence of staff is most prevalent in the agency and in the communication than in other areas The staff is positive about their working conditions The analysis conducted also evinces a good sense of belonging and a strong personal identification with the CSV This ensures stability over time The indicator shows the strengthening of the capacity of CSV to foster a positive climate that encourages business development both in the design phase and service delivery An associative favourable climate provides more guarantees in terms of fidelity and correct behaviour by individual members STRUCTURAL CAPITAL Structural capital is the set of tools and skills, technological innovation that enables the CSV to optimize organizational processes It includes all the features that go beyond the individual and are placed at the service of each CSV and the professionalism that it is aimed to obtain quality services With reference to the growth and renewal availability indicator a decrease in meetings held can be reported in 2013; however, the attendance at meetings has been constant especially by members With reference to the efficiency indicators, there has been an upward trend with an average of services provided to the urban area higher than the other territories under its jurisdiction There is also an increase in revenue from the Special Fund for Voluntary Service for grants handed out by public bodies instead of zero in 2013 The indicator of shares is an economic quantification embedded expression in line with the trend in the number of member organizations and it allows us to highlight the sustainability quality of the services rendered by the CSV The value of units underwent a slight decline The indicator of growth and availability to renewal shows a decrease in the meetings even though attendance at meetings is constant by shareholders Regarding the efficiency indicators, there is an increase of the urban area RELATIONAL CAPITAL Relational capital is the heritage of CSV made outside of relations established inside and outside the structure It expresses the result created by the use of intangible assets relating to both the structural capital and human capital The analysis of the indicators of relational capital shows the ability and aptitude of the CSV to produce positive results 36 A New Third Sector Intellectual Capital Model Table Structural capital indicators Growth and Availability to Renewal 2013 2012 Number of hardware equipment 19 19 Number of meetings 10 13 Number of meetings 10 13 Number of Shareholders’ meeting Number of board’s meeting Number of vehicles 1 Structures rented 1 Efficiency 3 Services Structure freely used 4178 5078 Projects 39 88 Social report 1 Mission report 1 Stability (1=Yes; 2=No) Service card 1 Guidelines 1 Source: Our elaboration For the indicator growth and availability to renewal there is a steady increase in the various urban areas The number of services provided is in remarkable growth and shows an increase in services provided through personal contacts Moreover, in the course of 2013 a number of accesses to the site with a very high increase in contacts via social networks should be noted This demonstrates the willingness of the CSV to engage and cultivate the interest of various age groups, especially the younger ones These indicators (increased telephone contacts managed in detail and contacts via the web) confirm the continued efforts of the CSV oriented to the improvement of communication (even more targeted and personalized) with the aim to achieve a constant level of sharing of experiences and knowledge The indicator is significantly stable and in line with the growth trend The higher number of seminars in 2013 compared to 2012 with a high participation of volunteers should be stressed Moreover, the constantly growing number of issues in the media is clear This confirms the ability of the CSV to approach the issues close to the community with the aim of raising public awareness These indicators give greater visibility to the CSV and its commitment to the territory With regard to the indicator efficiency, there have been many positive judgments (internal and external) that affect the company image There is also a growing trend with regard to collection by means of the per thousand tax donation Finally, the indicators of stability suggest a spatial distribution that correlates with the number of residents expressing a degree of attraction to the CSV being similar in different geographical areas, which is a manifestation of vitality and stability of the CSV The indicator in question confirms in terms of miles the increased need of the community and the continued demand for services by the whole territory 37 A New Third Sector Intellectual Capital Model Table Relational capital indicators Growth and Availability to Renewal Services users 2013 2012 729 746 Services offered 4817 3719 Web site access 65925 41541 Newsletter reader subscribers 3449 3270 Number of times on information media 132 110 Facebook contacts 1890 Number of seminars 32 12 Efficiency Average reply time 2 Number of collaborations 11 11 Support of per thousand charity offer 210 190 4 Internal/external Image Stability Organizations Pollino area 121 Organizations Tyrrhenian area 284 Organizations Ionian area 156 Organizations urban area 190 Source: Our elaboration RESULTS OF HYPOTHESIS TESTING AND LIMITS OF RESEARCH: A CONCLUDING SUMMARY NPOs vary from place to place and the sector has changed profoundly in recent years The IC approach seems well-suited as a managerial framework that can capture the intangible aspects of operations of NPOs However, more research and practical application experience are needed at this stage nowadays in Italy In most European countries NPOs have equally important economic as well as social dimensions and it occurs especially in the welfare services: the social services and health care The future scenario is for a further increase in the sector (Borzaga, C & Fazzi, L 2014) The new IC framework proposed contains the argument that Human Capital, Structural Capital and Relation Capital are all resources and, as such, each offers a potential avenue for competitive advantage The suggestion of a conceptual new IC framework such as the one in this paper is a significant addition to our understanding of the importance IC within the context of NPOs The framework of this IC report is proposed as a method of more fairly, objectively and transparently identifying the hidden value of the CSV and also all NPOs The new IC framework compiled by CSV in the province of Cosenza is a tool that can bridge the information gap and anchor the strategic objectives of the CSV in turn to the objectives of the individual NPOs Through the new IC framework CSV has been able to: identify and map the intangible assets; 38 A New Third Sector Intellectual Capital Model • • • • Increase understanding of how the interrelationship of people and knowledge can be created; Improve workers’ personal perception of the organization which leads to increased motivation to work; Create a culture of oriented performance improvement; Better understand the flow of knowledge within the organization The new IC framework is intended by the CSV of Cosenza as a management tool that allows monitoring the evolution of relations between the CSV and the community; it increases the diffusion of knowledge within and outside if properly used and allows a transparent communication with all stakeholders of the performance and organizational skills The new IC framework is seen as a means of fund raising, raising of financial resources and people raising, recruitment of new volunteers, but also as a tool to create greater involvement of people already in contact with the CSV and the consolidation of the reasons in the founders and the members Therefore, reporting through the new IC framework of CSV intellectual capital is a strategic factor for design along with the NPOs that are addressed to it in the future and it can broaden the base both human and financial resources Further work should explore the value IC brings to the organization, focussing on investigating how CSV relate to organizational performance, how the reporting on certain IC resources could be, how knowledge activities impact on IC indicators, and how IC measurement, management and reporting are actually embedded in the organization In the field is important to remind as one aspect of the existing research on the non-profit sector is the generic nature of studies and models, this study adds knowledge to our understanding of the specific role of IC in the sector of NPOs providing public services in a territory which represents a peculiar case in the non-profit scenario So this work contribute to have a new side of view of IC applied in the NPO as previous research were few focussed The continued commitment to the development of the IC, the sharing of CSV Knowledge through the use of media and training initiatives allow a constant involvement of citizens and volunteers who with the growth of their skills acquire a greater social awareness The knowledge acquired over time allows both a reduction in the social cost borne by the community and an increase in the level of safety of the users in contact with the CSV The new IC CSV framework aims to standardize the display mode of intangible resources through their grouping into the three dimensions of IC (human capital, structural capital, relation capital) and subdivided into growth and renewal, performance and stability indicators IC is an important resource that CSV needs to develop in order to gain sustained strategic advantages This work helps to build a nascent body of literature suggesting that IC can be utilised as a competent strategic management conceptual framework in all NPOs The increased awareness of the IC concept in NPOs, as a result of this paper, likely generates further research Unlike many other for-profit strategy concepts, IC stresses qualitative, non-financial indicators for future strategic prospects and can be harnessed to co-ordinate with the unique environment in which NPOs operate IC contributes to CSV strategic positioning by providing enhanced understanding of the allocation of organisational resources Simultaneously, IC enables the CSV to enhance its performance by providing meaningful information to organisational stakeholders In these ways, IC aids the organisations in their attempts to reconcile their social and commercial objectives 39 A New Third Sector Intellectual Capital Model The IC framework helps to shift the focus towards strategic CSV intellectual resources including knowledge, skills and experience through constant monitoring The sharing of knowledge management tools and knowledge allows the improvement of the effectiveness and efficiency of the services provided and improved organizational stability CSV to guarantee the new challenge for the development of strategic knowledge The IC framework requires little interpretation, when used and disseminated within and outside the CSV it encourages the sharing of resources rather than competing for resources This is due to a change in behaviour and values of people regarding what is good and what is bad for the organization of what is right and what is wrong The 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Servizi Volontariato (CSV) can be classified into three categories: Table Intellectual capital indicators Human Capital Structural Capital Relational Capital Growth and Renewal Skills Availability... structural capital and human capital The analysis of the indicators of relational capital shows the ability and aptitude of the CSV to produce positive results 36 A New Third Sector Intellectual Capital. .. (Borzaga, C & Fazzi, L 2014) The new IC framework proposed contains the argument that Human Capital, Structural Capital and Relation Capital are all resources and, as such, each offers a potential