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INTRODUCTION
As Non Governmental Organizations (NGOs) grow in during times of weak governance or corruption. Even dur-
importance on the international development scene, ing times of good governance, local authorities and firms
transparency, accountability and government co-option may lack the incentives for programs such as po-verty
are becoming increasingly important topics. The growing alleviation and job creation. Further more, an NGO may,
influence of NGOs requires that donors, academics, and at least in theory, better address the needs of the com-
policy makers start carefully examining transparency and munity it is serving. Because similar problems, and pos-
accountability both in micro and macro level. sible solutions, exist in the other countries they operate
NGOs are becoming increasingly important institutions in, NGOs can often bring innovative techniques and solu-
in developing countries. The number of international tions to regions in need. NGOs also provide public goods
NGO’s grew 20-fold from 1964 to 1998. In the 1990s, to sections of the population that might be socially
NGOs grew by an additional 20% and currently 3,187 excluded. Examples include public health facilities, com-
NGOs have consultative status with the United Nations munity negotiation with governments, and property re-
(un.org), up to 30% from 2003 (Todaro and Smith, 2006). gistration. Also, the preservation of common property
The rapid growth of NGOs is important because of the such as forests and rivers is propagated by NGOs.
special role they play in socioeconomic development. NGOs teach sustainability techniques to people who
There are numerous advantages to NGO work. Since would otherwise have limited incentive to conserve. They
they are independent bodies, NGOs can assist nations can act as an advocate of those who would otherwise not
be heard within their own nation. Lastly, NGOs are often
seen as more trustworthy and credible than governments
or private firms (Todaro and Smith, 2006). Table 1 suc-
*Corresponding author. E-mail lawrenpg@morris.umn.edu. cinctly illustrates the strengths and weaknesses gene-
Lawrence and Nezhad 077
Table 1. Strength and weaknesses generally associated with the ing a more recent issue of government co-option.
NGO sector (Shastri 2008).
The incentive for downward accountability is embodied in These standards can be summarized as: (a) ensuring
the NGO’s mission statement or perhaps in individuals’ that the survivors of war or disaster can influence the
personal values. When an NGO does not articulate the decisions about the aid they receive and (b) they are able
value of downward accountability, it is simple to see that to object if they feel that the authority of aid workers is
upward accountability may receive greater focus. being misused. HAP-I provides training, networking, and
The four directions of accountability are general macro- support to its member NGOs, as well as potential mem-
level obligations of the NGO. However, the micro-level bers, so they may adhere to HAP-I’s principles of accoun-
circumstances within which the NGO operates will greatly tability. HAP-I also monitors member organizations and
determine the level and direction of accountability em- reports on the NGO’s performance to beneficiaries. If
ployed. It is important for policy-making bodies to recog- complaints or concerns are raised about a member, HAP-
nize the amount of flexibility required for NGOs to operate I will serve as a mediator to reach a solution. Humani-
effectively at the local level. tarian Accountability Partnership International is a prime
It can be assumed that most NGOs recognize the example of how the call for accountability can be ans-
importance of some form of accountability. In this re- wered on a macro-level (Hapinternational.org).
search project we sought to discover which directions of People-In-Aid (PIA) is another code-of-conduct organi-
accountability were in place by the NGOs surveyed and zation which mission is “to promote, support and recog-
to observe some effective methods used to define and nize good practice in the management of aid personnel.”
enforce accountability. PIA grew out of a British research project focused on
In this research project we examined if any of the improving the organizational structures within non-profit
NGOs participating in our study were members of a code- organizations. In 2001, this research project led to the
of-conduct organization. We also sought to identify what development of an organizational framework, ‘the Code,’
needs the NGOs had that are currently being addressed as well as the development of an audit mechanism that
by code-of-conduct organizations and what macro-level allowed member NGOs to monitor their progress. In
needs remain unaddressed. 2003, the Code was revised and is now known as the
‘Code of Good Practice.’
PIA’s 133 members work with each other to improve
Code-of-conduct organizations their organizational efficiency at networking seminars and
through other networking services provided by PIA (peo-
Macro-level code-of-conduct organizations allow NGOs pleinaid.org). This organization attempts to meet a very
to learn from one another, while at the same time pro- important need in the NGO sector. As the Senior Pro-
viding a minimum standard for humanitarian aid work, gram Director of the NGO Shramik Bharti states, “Affor-
including the work of NGOs. This “bottom line” can help dable HR with commitment and competence” is one of
NGOs develop some of their initial accountability and the biggest problems facing NGOs today.
transparency procedures more efficiently. Perhaps more A final significant code-of-conduct organization on the
importantly, being a member of these organizations international NGO scene is Sphere. Sphere believes that
provides assurance to donors about the legitimacy of the “all possible steps should be taken to alleviate human
NGO, which increases the NGO’s macro-level transpa- suffering arising out of calamity and conflict, and…that
rency. These organizations are especially important in those affected by disaster have a right to life with dignity
nations where government is unable or unwilling to moni- and therefore a right to assistance.” Sphere provides its
tor NGO activity. Three major code-of-conduct organi- members with a handbook and a process of collabo-
zations are outlined here to exhibit their functions within ration, and ensures that members are committed to qua-
the NGO community. lity of service and accountability. Sphere works with the
The mission of Humanitarian Accountability Partnership Red Cross and the United Nations agencies as well as
International (HAP-I) is “to make humanitarian action other international and national NGOs. A board of NGO
accountable to its intended beneficiaries through self- representatives provides support services, training oppor-
regulation, compliance verification and quality assurance tunities, and materials to all interested parties, all focused
certification.”This code-of-conduct organization originated on improving the quality of humanitarian aid (Spherepro-
from a failed “Humanitarian Ombudsman Project,” which ject.org).
attempted to assist in litigation against corrupt interna- Code-of-conduct organizations stress the importance of
tional humanitarian agencies. While the “ombudsman” accountability and transparency on the macro level and
approach failed to be effective, a need to address the the subsequent NGO improvements transfers to the
accountability ‘gap’ in humanitarian aid situations re- micro level. The Humanitarian Accountability Project,
mained. As a result, HAP-I was created to “identify, test People-In-Aid and Sphere all serve important macro-level
and recommend alternative approaches to accountabi- roles in the international NGO scene.
lity.” The organization has 22 full members, including big
aid names such as CARE International and Oxfam GB. Transparency
By joining HAP-I, the members agreed to abide by the
organization’s minimum standards of accountability. Increased transparency can encourage greater donations
Lawrence and Nezhad 079
by assuring donors that their donations are reaching the NGOs are actually helping or hurting citizens. How can
desired populations, can clarify accountability groups, political or economic change occur when NGOs continue
and can increase overall quality of NGO service. One to mollify the consequences of structural shortcomings?
important role of transparency is to reduce corruption Also, when large government funds are involved, who
within the organization and more importantly during influences the direction of NGO projects, the government
humanitarian crises. Humanitarian crises can lead to an or those in need? (Todaro, 2006). Government co-option
inequitable distribution of aid, which includes NGO ser- also introduces the possibility that governments may step
vices, basic need supplies or development funds. NGOs out of some vital sectors such as health and education
are particularly vulnerable to fraud, embezzlement or bri- due to lack of funds or due to political or social controver-
bery, which can occur when local governance is des- sies in these sectors under the guise that the NGOs are
troyed, the rule of law is all but gone, or there is a shor- already providing these vital services (Nagar, 2003). This
tage or surplus of aid. Transparency helps ensure that therefore replaces what should be the responsibility of
aid via NGOs reaches those who need it, and offers the government with dependency on the services provi-
some protection for the aid recipients. This protection is ded by the NGOs.
especially important due to the asymmetric relationship of
NGO aid. Left without any substitutes, aid recipients
have very little power to control the activities of those giv- METHODOLOGY AND RESULTS
ing aid (Transparency International) Therefore, it is A detailed questionnaire was developed with 20 qualita-
important that transparency processes in some way tive questions that covered the basic operations of the
reflect how aid recipients feel their needs are being met. NGO, its accountability and transparency procedures,
Extensive transparency procedures can be costly and and the extent of its government interaction. The ques-
time consuming. In the past, charities were simply asked tionnaire was sent to six NGOs and completed by senior
to report on money raised, spent, the number of clients members of the organization during July and August
reached, and the administrative costs involved (Slim, 2008 (details are provided in Appendix B). The NGOs
2002). However, the current NGO community recognizes interviewed represent a variety of NGO structures, from
that multiple stakeholders require multiple methods of small to large, those with a limited focus to a very broad
creating transparency. Transparency methods can be in- focus. We received five responses and additional follow-
ternal evaluations, external audits, complaints proce- up questions to clarify responses were asked. However,
dures, environmental impact assessments, specific one of the questionnaires was excluded from this study
stakeholder surveys, or social audits. Transparency due to incomplete information. In addition, one NGO,
walks a fine line; it is difficult to quantify abstract ideas Compassion International, was interviewed in person by
such as ‘empowerment’ and ‘awareness,’ however it is the authors during June 2008 at their Hsinchu office in
imperative that progress be monitored on such projects. Taiwan. The next section provides a brief description of
The search for immediate results may also mean looking all the NGOs interviewed, followed by an outline of the
for short-term solutions or ‘insisting upon digging up the organizations’ transparency techniques. We avoid provid-
seedling to examine its roots before it can bear fruit’ ing a quantitative summary of the techniques used since
(Edwards and Hulme, 1996). the NGO size and scope differs greatly from one case to
another.
Government co-option
nal works to improve education and living standards among achievement of the project milestones as an evaluation
the aboriginal populations in Taiwan’s mountains. Details on technique. Shramik Bharti also performs impact evalua-
each NGO, their mission and current projects, and the tions through base line surveys, mid term evaluations and
primary challenges that they face are described in Appendix end project evaluations. Shramik Bharti’s multifaceted
A of the paper. system may seem like it carries high administrative costs.
However, senior program manager Rakesh Pandey says
Results on accountability and code of conduct that the monitoring techniques are “quite effective” and
organizations although “proper planning with the team takes time…we
save on total time of the project.”
Contrary to the fears raised in the literature on NGOs, all The Academy for Educational Development (AED) tai-
four NGOs interviewed appeared to value client accoun- lors its transparency techniques to each project since
tability equally with donor accountability. The methods of project varies widely. In the case of some large projects,
transparency used to reinforce these directions of AED completes client-requested and donor funded exter-
accountability are detailed in the following section of this nal evaluations of the projects. AED employs finance
paper. It may be argued that there may be some selec- managers to cover all projects. In addition, both internal
tion bias, involved as participating in this project was and external audits are conducted of field expenses.
voluntary and one of the NGOs that was contacted did Finally, the U.S. government acts as a source of transpa-
not respond to the survey and this could lead to some rency for AED by performing an annual audit of the orga-
bias. We concur that this may be a possibility but the nization due to its non-profit status.
study still sheds significant light on important issues Compassion International takes a more hands-on
related to the functioning of NGOs. approach to providing transparency. In order to assure
The questionnaire (see Appendix B) included questions accountability, Compassion International sends a social
related to the participation of NGOs in code-of-conduct worker to the client community in order to identify the pro-
organizations. None of the NGOs interviewed mentioned blems of the village. After the village needs have been
being a member of a code-of conduct organization. discussed by the organization, a press announcement is
There are several possible explanations for this finding. made to the local donor community. Monthly community
One explanation may be that smaller NGOs, such as activities are organized where older members of the abo-
Compassion International, simply do not have the re- riginal community come to speak with donors about the
sources to send representatives to networking conven- needs of the village and the progress being made. In
tions or have such a specialized field of operation that the addition to this personal display of transparency, donors
benefit of joining such an organization is small. Another may also look at Compassion International’s quarterly
possible explanation is that while the interviewed NGO’s financial reports for more formal progress indicators.
are not a member of a code-of-conduct organization,
some of their donors are members. This is true in the Results for government co-option
case of Gravis, which receives donations from CARE
International and therefore may receive the indirect bene- Compassion International has the most direct approach
fits of being a member of HAP-I. to government co-option; they choose to accept no go-
vernment funding. One reason for this refusal is the
Results on transparency inflexibility of the requirements that come with govern-
ment funding. Upon accepting a government grant some
Gravis promotes transparency in decision making by time ago to send schoolteachers to aboriginal commu-
holding regular meetings with the staff and community. nities, Compassion International was told what proportion
In addition to community meetings, Gravis evaluates its of the grant was to be used for specific purposes. In their
work through a Technical Advisory Committee comprised particular situation, a very small proportion of the grant
experts in the fields of agriculture, hydrology, horticulture, was allotted to cover transportation costs; an amount that
sociology, education and engineering. In order to reduce was similar to what was allotted for school transportation
the risk of corruption, Gravis makes all field payments in a city. However, in order to reach the aboriginal com-
through field accountants in the presence of field workers munities through windy mountain passes, the teachers
and community members. External audits are also con- really needed SUVs or other large vehicles. Unfortu-
ducted periodically as a further method of increasing nately, due to the government-dictated transportation
transparency. budget, the already underpaid teachers were forced to
Shramik Bharti uses a detailed evaluation process of use dangerous motorcycles to reach the villages. Be-
input/output analysis as a transparency technique. Input sides grant restrictions, Compassion International
is monitored through finance budgets and project plans. chooses not to accept government funds due to the fact
Output is monitored by comparing actual achievements that grants can often “come and go. Maybe next year the
against planned output. An alternative to output moni- social worker will not have a salary,” says the Hsinchu
toring is process monitoring. Process monitoring uses the regional office manager. There is a shared sentiment
Lawrence and Nezhad 081
among the NGOs that were interviewed that governments demy for Educational Development employs a formal
often only want to see results, with insufficient attention transparency technique by employing finance managers
paid to the development process or sustainable develop- on all projects; finance managers lower the risk of cor-
ment practices. Often government projects create what ruption by double-checking every expense. However, the
Compassion International calls ‘mosquito buildings’; rest of AED’s transparency framework is very flexible due
quickly assembled buildings that serve little function other to the large variation in its clientele. In contrast to AED’s
than to house mosquitoes. While they do not accept large clientele, Compassion International is a small NGO
government funding, Compassion International does help that employs a hands-on approach to accountability.
the government by providing them with data about the Monthly community activities where clients speak about
aboriginal populations so the government may better progress in the village allow donors to witness and ques-
serve the communities. tion first-hand the impact of their donation. As a formal
The other three NGOs surveyed did accept some counterpart, Compassion International publishes quar-
government funding and worked with the government on terly financial reports. Macro-level code-of-conduct orga-
certain project. However, there were several complaints nizations can increase a NGOs transparency by showing
that government often slowed down their work and that the NGO adheres to a minimum standard of accoun-
projects. It was also mentioned by all NGOs that when tability. However, transparency ultimately must be tai-
the government is not able to serve certain areas ade- lored within the political, social, and organization environ-
quately, it is the duty of the NGO to work around the ment of an individual NGO.
inefficiencies and cooperate with government as neces- Government co-option leads NGOs to ask what is more
sary to better serve their communities. Thus there ap- valuable to them: government funds or the freedom to
pears to be limited conflict between the roles of NGOs design projects and implement them at a pace decided
and the government in providing services to the com- by the operation. Compassion International refuses to re-
munities that are served by the NGOs included in our ceive any government funding due to the restrictions that
study. come with government grants. Many of the NGOs shared
this sentiment that government can be a burden.
However, the other three NGOs accepted government
Conclusions funding, determining that with it they could better meet
It is imperative that all of those involved with NGOs de- the needs of their clients.
mand accountability in all directions: to donors, to clients, Accountability, transparency, and government co-op-
to employees, and to the NGO community. Specifically, it tion are crucial issues facing the growing NGO sector. In
is crucial that NGOs increase and maintain downward this paper we explore the directions of accountability, and
accountability to clients. Gravis demonstrates accoun- the various degrees of transparency and government co-
tability to clients by allowing client input on development option. With the results of only four NGOs, it is obvious
projects during regular meetings between staff and the that a multitude of effective transparency techniques
community. Compassion International also demonstrates exist. It is therefore important for government institutions
a commitment to downward accountability by sending a and other policy-making bodies to recognize that NGOs
social worker to consult with aboriginal communities must be regulated but this regulation should allow for
about their needs. some flexibility. Flexibility in regulations will allow NGOs
Many different methods of transparency can reinforce to customize their transparency techniques to best serve
accountability, as demonstrated by the four NGO that their clients, donors, peers, and themselves.
participated in our study. Gravis employs transparency
techniques that are easy for their donors to interpret ACKNOWLEDGEMENTS
through expert reports from its Technical Advisory Com-
mittee and through periodic external audits. In addition to The authors would like to thank the participating NGOs
these quantitative methods of transparency, Gravis em- and the University of Minnesota’s Undergraduate Re-
ploys client-targeted transparency by including clients in search Opportunity Program that made this research
project decision-making. Shramik Bharti emphasizes possible.
accountability both to clients and donors through its
detailed input/output evaluation, process monitoring, and
impact evaluation methods of transparency. These me- REFERENCE
thods are all formal, quantifiable methods of transpa- Department of Economic and Social Affairs-NGO Section. (2008).
rency, which makes them easy for donors and clients to Retrieved October 1, 2008, from United Nations Web site:
interpret, and makes it easy to chart progress of the http://www.un.org/esa/coordination/ngo/
NGO. However, the disadvantage to these quantifiable Edwards M, Hulme D (1996). Too Close for Comfort? The Impact of
Official Aid on Nongovernmental Organizations. World Development.
measurements is that it may be difficult to include an
24: 961-973.
assessment of the development of qualitative concepts Lloyd R (2005). The Role of NGO Self-Regulation in Increasing
such as “self-confidence” or “empowerment.” The Aca- Stakeholder Accountability. One World Trust.
Int. NGO. J. 082
Nagar R (2003). Women, NGOs and the Contradictions of Empower- Major decisions on development projects are decided by
ment and Disempowerment: A Conversation. S. Raju, Antipode. 35:
an Executive Council; routine decisions are made by
1-13.
Shastri RK (2008). "A strategic action plan for managing non govern- management. Shramik Bharti currently service approxi-
ment with special reference of India definition of NGOs." Inter. NGO mately 50,000 households. Current projects are:
J. 3(3): 074-076.
Slim H (2002). By What Authority? The Legitimacy and Accountability of • Formation of Self Help Groups and their Federations.
Non-governmental Organisations. The Council on Human Rights
Policy. • Promotion of Producer groups.
Todaro MP, Stephen CS (2009). Economic Development (10th Edition). • Low external input agriculture.
Pearson Addison Wesley. • Biological treatment of Sodic Lands.
• Promotion of rearing Ahimsa Silk in ravines of Yamuna.
Appendix A • Reviving traditional handloom cluster.
• Improving equine welfare.
NGO Summaries • Promoting Home Based Life Saving Skills for Safe
Motherhood.
Gravis
• Supporting destitute senior citizens.
Gravis is based in Jodhpur, Rajasthan, India. The orga- • Awareness about HIV/AIDS.
nization has been in existence since 1983, working on • Strengthening Grassroot democracy.
improving living conditions inherent to the Thar Desert of
India. Gravis considers the beneficiary community impor- Funding for Shramik Bharti comes from international, do-
tant in deciding which projects will be undertaken. Their mestic, and government sources. The average project
technical advisory committee then designs the best budget is $40,000 per year. 40% of funding is spent on
approach to the problems. Projects can range from activities other than salaries.
$1,000-$1,000,000 dollars; over 85% of resources are Shramik Bharti works with the government as a comple-
spent on direct project implementation. ment to their work.
Some government co-opted projects include promoting
Gravis has collaborated with the government on “a
reproductive and child health, family planning, microfinance,
number of projects.” These projects have both compli-
agricultural improvement, and the training of local politi-
mented and substituted government work. Some exam-
cians. While the government partially or wholly finances
ple of Gravis’ substitution work includes providing basic
these activities, they do not enter into the implementation
needs to the community: water security, food and agri-
process.
culture assistance, health and education. The head of
One of the biggest problems facing Shramik Bharti is a
Gravis emphasizes, “it is not a matter of [government] re-
lack of financial resources. As the Senior Program Ma-
entering [these areas]. It is a matter of optimizing the
nagers states, “When things start happening resources
resources and developing effective e partnerships so that
dry up and bags are packed.” Website: www.shramik-
existing money/services reach who need it most.” Gravis
bharti.org.in
has not felt that government has impeded their work, and
has been able to sort out “negative experiences.”
Gravis occasionally faces some opposition from its
Academy for Educational Development
client community. Gravis also has trouble finding good
human resources. Also, the natural disasters that come The Academy for Educational Development (AED) is
with life in the Thar desert—droughts and floods—impact based in Washington D.C., USA. AED was founded in
their work. The head of the organization states that a 1961 and works to improve education, health, civil society
“lack of effective partnerships and exhausting financial re- and economic development. There are many programs
sources” is the biggest problem facing NGOs today. currently being implemented by AED. The Director of
Website: www.gravis.org.in Energy Programs was interviewed; some current energy
projects include: projects in Sudan and Angola, a know-
Shramik Bharti ledge management project in support of the USAID Ener-
gy, Infrastructure, and Engineering office, as well as a
Shramik Bharti is based in Kanpur, Uttar Pradesh, India. Powering Health website. They are expecting to work on
Approximately 15 other NGOs operate within the same an energy/health project in Haiti soon.
project area. The organization has been in existence Project budget varies widely by project type. The
since 1986. Shramik Bharti works to empower the poor and smallest AED energy project is around $25,000 and the
underprivileged, especially women and children. To do this, largest is a five-year project in Angola costing $6 million.
Shramik Bharti promotes democratic institutions and helps The largest organization-wide project known by the
people develop their capabilities to give them greater control Energy Director is $150 million.
over their lives. As is stated in their mission “Shramik AED does not usually work directly with governments.
Bharti’s programmes grow out of that respect and faith in However, the government component is often considered
idea of a truly democratic society, free from exploitation.” when designing a project and often the services provided
Lawrence and Nezhad 083