Course 4: Transparency and Accountability

“Until recently NGOs were thought to be exempt from traditional oversight; their do-good nature and the commitment of their participants were thought to be sufficient to produce positive results.”(1) Unfortunately, however, it has been found that many NGOs conceal information; therefore, accountability and transparency are increasingly important in the non-profit sector. A study which examined 300 Ugandan NGOs on the availability and reliability of self-reported information found that there seem to be few incentives to be transparent, but many incentives to conceal information. This is because “if organizations can choose when to disclose and when to conceal information, they can be praised for their accomplishments without being criticized for their failures, mistakes and shortcomings.” In addition, though many NGOs report high levels of transparency, they were unwilling to provide information when asked, or gave out inaccurate information. This suggests that NGOs realize that they are expected to be transparent, but many only pay lip service to the idea. For example, though 91% of the Ugandan NGOs reported asking the communities about their needs, and though 96% reported asking the communities for feedback during a project, just 54% of the communities said that the NGO asked community members about their needs, while only 59% said that they were requested to give feedback.(2) In addition, in 39% of the cases, NGOs reported that they asked the community about their needs prior to initiating projects, while the community said that the NGO did not.  Similarly, 38% of NGOs claimed to have asked for feedback from communities, while the communities said they were never asked for feedback. In this study, there was a remarkable overlap between the cases of misrepresentation regarding assessing community needs and asking for community feedback. 69% of the NGOs that claimed they asked communities about their needs also reported that they asked the community for feedback, but the study results indicate that this did not occur.(3) Thus, it is evident that measures to ensure transparency and accountability are increasingly needed in the non-profit sector.

It is also important for NGOs to avoid creating pitfalls and illusions regarding their services and missions. For example, Kiva, a non-profit micro-finance organization, had promoted itself by claiming to be a direct link between lenders and individual borrowers. By providing photos and profiles about the intended loan recipients, the organization led the public to believe that online lenders were supporting the recipient that they personally selected on the Kiva website. Nicholas Kristof extolled Kiva and explained how he “lent $25 each to the owner of a TV repair shop in Afghanistan, a baker in Afghanistan, and a single mother running a clothing shop in the Dominican Republic.” However, in November of 2009, David Roodman, a research fellow at the Center for Global Development, brought to the public’s attention the fact that lenders were not making direct loans. Borrowers, like the owner of the TV repair shop Kristof thought he had donated to, already had received loans by the time their pictures and biographies were posted on Kiva’s website.  “Thus, the direct person-to-person connection Kiva offered was in fact an illusion.”(4) Though Kiva advertised that funds would be sent to help specific borrowers, in reality it sent funds into a general microfinance pool,(5) and less than 5% of Kiva loans were disbursed after the profile appeared on Kiva’s site. The remaining loans were disbursed prior to publishing the profiles and photos. Ultimately, Kiva created this illusion in order to maximize its marketing and fundraising abilities. It would not be economically efficient to meet a borrower, make sure s/he would qualify for a loan, take their picture, translate their bio, post it on the website, and then wait for a donor to pick that person. Though Kiva had good intentions, the organization still misled many Kiva users, and for an organization that prides itself on transparency, it acted in a manner hypocritical to its mission. Now, Kiva has changed its website and explains that a donation might not go to the specific person profiled, though lenders still select a person's profile as the recipient of their loan.(6)

Organizations such as Save the Children Federation (SCF), which provide donors with a child they sponsor and correspond with, have also recently been under scrutiny for their lack of transparency. For example, through Save the Children Federation, the Dixons, a family from Bellingham, Washington, sponsored Abdoul Kone from Mali beginning in 1990. In 1996, they were still receiving Christmas cards from the boy, though the boy had died three years earlier in a donkey accident. In this case, Save the Children Federation wasn’t able to monitor the children closely enough to ensure that the Dixons were sponsoring a living child, or that the child was receiving benefits.(7) When Jeff Ramin, Save the Children’s Mail field office director learned of Abdoul’s death, he sent a letter to the Dixons in February 1997 stating that Abdoul had fallen victim to one of the childhood diseases that the organization tries to prevent, though Abdoul's death was due to a donkey accident.(8) This lack of transparency did not only occur on only one occasion. Lisa Anderson, a reporter from the Chicago Tribune, decided to sponsor a child, and years later went to Mali to see how her donations had helped. Upon arriving in the village, the reporter found out that her sponsor child, Kortoumou, had died three months after her sponsorship had begun, yet no one had informed her. As she explains, “not only had SCF failed to inform me of her death, it had readily accepted another $240 in December 1996 to specifically sponsor Korotoumou.” Upon further investigating Save the Children Federation, Anderson discovered that SCF health and education workers had no idea who the sponsored children were and who was receiving benefits.  A later SCF internal inquiry uncovered 20 other cases in Mali of sponsored children who had died without their sponsors being notified promptly, and 4 cases where the sponsors had never been notified.(9) This lack of transparency was misleading and caused much anguish for people like the Dixons who thought they had been helping a specific child, when in reality the child had died. Now the organization no longer claims that donations will go to a specific child, but rather contributions are pooled to provide community-based programming for all eligible children in a given area.(10)

Transparency and accountability are essential to responsible NGO management.

Footnotes

(1) Christensen, J. (Jan. 3, 2004). “Asking the Do-Gooders to Prove They Do Good.” The New York Times. https://www.nytimes.com/2004/01/03/arts/asking-the-do-gooders-to-prove-they-do-good.html.

(2) Burger, R., and Owens, T. “Promoting transparency in the NGO sector: Examining the availability and reliability of self-reported data.” Discussion Papers 08/11. University of Nottingham. http://ideas.repec.org/cgi-bin/ref.cgi?handle=RePEc:not:notcre:08/11&output=0.

(3) Ibid.

(4) Strom, S. (Nov. 8, 2009). “Confusion on Where Money Lent via Kiva Goes.” New York Times. https://www.nytimes.com/2009/11/09/business/global/09kiva.html.

(5) Ogden, T. “Even More Questions About Kiva.” http://www.philanthropyaction.com/nc/even_more_questions_about_kiva/.

(6) Ibid.

(7) Dellios, H., and Anderson, L. (Mar. 15, 1998). “Greetings From Grave: ‘We Are All Doing Well’.” Chicago Tribune. http://articles.chicagotribune.com/1998-03-15/business/9803150061_1_dixons-donkey-cart.

(8) Ibid.

(9) Anderson, L. (Mar.15, 1998). The Miracle Merchants.” Chicago Tribune.http://articles.chicagotribune.com/1998-03-15/business/9803150063_1_korotoumou-interpreter-bakary-kone.

(10) “Save the Children. Sponsor a Child.” http://sponsor.savethechildren.org/CGI-BIN/lansaweb?webapp=SPNPRD+webrtn=productcentral+ml=LANSA:XHTML+partition=PR2 +language=ENG+sid=adf0b28a1b091693ac3f190a7307dac369c167d0.