Introduction

• Over the past two decades there have been a series of highly publicized scandals that have damaged public confidence in non-profit organisations

  • This is coupled with the rapid growth in NGOs around the world (Gibelman & Gelman, 2001)

• There is a belief among donors that NGOs are more cost-effective than governments in providing social services

  • But there is a lack of empirical evidence to support this (Edwards and Hulme, 1996)

• Long-time practitioners and scholars in the field are advocating moving beyond seeing NGOs as “magic bullets” to thinking more concretely about issues of accountability (Edwards and Hulme, 1996)

• There are five key accountability mechanisms used by NGOs in practice

Accountability

• Accountability is “the process of holding actors responsible for actions” (Fox and Brown, 1998)

• Accountability is about being “held responsible” by others and about “taking responsibility” for oneself

• Accountability can be looked at in a dual perspective:

  • Internal

  • External

• Behn suggests a ‘360-model’ of accountability that would require public agencies to shift form current adversarial modes of accountability enforcement to an emphasis on cooperative responsibility

• Dunn proposes increased transparency of information from public officials purporting to act in a public interest

• James Madison - “the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it control itself” (51^st Federalist Paper, as quoted in Przeworski et al., 1999)

• Accountability mechanisms are used not only by funders to keep track of NGO spending, but also by NGOs to leverage funds by publicizing their projects and programs

  • Multiple and sometimes competing accountability demands

• Edward Freeman (1984) – “stakeholder approach”

• Najam (1996) has observed that NGOs are accountable to multiple actors

  • Patrons

  • Clients

  • Themselves

• Avina (1993) drew the distinction between:

  • Functional accountability

    • To patrons of NGOs is typically high in practice

    • To clients and themselves is typically low

  • Strategic accountability

    • Accounting for the impacts that an NGO’s activities have on the actions of other organizations and the wider environment

    • Weak towards all actors

Disclosure statements and reports

• Frequently required by federal or state laws in many countries

• When seeking federal tax exempt status in the US, NGOs are subject to the requirements of section 50(c)(3) of the Internal Revenue Code

  • Must complete Form 990 to demonstrate that its activities are primarily for educational, charitable, religious, or scientific purposes and for public benefit

• Enables some degree of accountability to donors, clients and members who wish to access these reports

  • But clients and donors often have very limited legal standing to challenge an organization for failing to meet legal requirements

    • The responsibility falls on the attorney general to act as the “representative of society at large” (Balda, 1994)

• Can be abused by governments to keep tabs on organizations

  • E.g. India

    • Foreign Contribution Regulation Act (FCRA, 1976)

      • Enabled the government to monitor the flow of foreign funds to NGOs and scrutinize those critical of the state (Fernandes, 1986)

    • All Indian NGOs receiving foreign funds must open special FCRA accounts that enable federal oversight of the use of those funds

• Reports and legal disclosures are significant tools of accountability

  • They make available basic data on NGO operations

• But they emphasize upward reporting

  • Almost no attention to downward accountability to stakeholders

• Limited potential for encouraging organizations and individuals to take internal responsibility for shaping their organizational mission etc.

Performance assessment and evaluation

• Useful to distinguish between external and internal evaluations

• Hybrid internal and external evaluations are not uncommon

  • Some NGO staff work jointly with external evaluators

• Both types of evaluation suffer from problems over measurement and relevance

• Concerns:

  • 1) Conflicts among NGOs and funders over whether they should be assessing processes or the tangible products

    • An appraisal tool increasingly used by bilateral donor agencies is logical framework analysis (LFA)

      • Inadequate for monitoring complex development interventions (Edwards and Hulme, 1996)

      • Wide use of this and similar frameworks may “distort accountability by overemphasizing short-term quantitative targets”

        • “accountancy rather than accountability

  • 2) Donor response to such skepticism over measurement is that evaluations can help NGO staff become better “doers” by uncovering weaknesses in project planning etc.

    • NGOs are concerned that performance assessments give funders the arsenal to base funding on “successful” projects, thereby rewarding NGOs that stick to discrete and proven product-based approaches to development (Riddel, 1999)

    • NGO size and capacity should be key factors in determining the scale of an appraisal

  • 3) Tendency to equate evaluation with assessment of performance

    • Evaluations have the potential for facilitating broader organizational change

    • Evaluation can be a tool for learning

      • “by encoding inferences from history into the routines that guide behavior...

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