Business Barbados

What is The Third Sector?

‘Third Sector Organisations’ is a term used to describe the range of organisations that are neither public sector nor private sector.

It includes voluntary and community organisations (both registered charities and other organisations such as associations, self-help groups and community groups), social enterprises, mutuals and co-operatives.

Third Sector Organisations (TSOs) generally:

  • Are independent of government (but may still receive some State support). This is also an important part of the history and culture of the sector;
  • Are ‘value-driven’. This means they are motivated by the desire to achieve social goals (such as, improving public welfare, the environment or economic well-being) and not the desire to distribute profit; and
  • Reinvest any surpluses generated in the pursuit of their goals. For this reason TSOs are sometimes called ‘not-for-profit organisations’. A better term is ‘not-for-personal-profit’. In many cases, TSOs need to make surpluses (or ‘profits’) to be financially sustainable.

TSOs can take a number of legal forms. Many are simple associations of people with shared values and objectives. Many have company status but with a not-for-personal-profit approach. Very many have charitable status.

Benefits that third sector organisations provide

Public and Private Sector organisations can gain a lot from working with Third Sector Organisations. Some of the common themes are:

  • Understanding of the needs of service users and communities that the public and private sectors need to address;
  • Closeness to the people that the public and private sectors want to reach;
  • Ability to deliver outcomes that the public sector finds it hard to deliver on its own;
  • Innovation in developing solutions that can be commercialised; and
  • Performance in delivering services.

TSOs also speak out for people and their needs to the public sector and to wider society. Such activity may be based on a local, drop-in facility to feed the needy, right through to a charity’s national communications campaign for example on education for Special Needs Children or Addiction Treatment).

Government’s reduced financial capacity to fund all social needs underscores the need for TSOs to fill some of that gap working in partnership with the Private Sector and Philanthropists.

In Barbados this collaboration is already being demonstrated in the areas of Education, Addiction Treatment, Poverty Alleviation, Homelessness, development of the Creative Sectors, Heritage Preservation, Sustainable Agriculture and Entrepreneurship Ecosystem Development.