A Quest for Credibility

Economics

Major cutbacks in donor budgets are not the only matter calling the future of NGO operations into question. Something else looms large, and perhaps more significantly, on the agenda: the diminishing credibility of the sector in the eyes of the public, donors and governments. The crux of this stems from a lack of accountability—the fact that NGOs, unlike governments and private corporations, have no universally recognised mechanisms1 to ensure effective operations, efficient expenditure or general good practice. Throughout the world, NGOs are active in day-to-day civic affairs, yet feedback reports written for their donors are unavailable in the public domain. Such unaccountability, teamed with frequent press investigations covering finance misappropriation and lavish expenditures by NGO executives, is undermining the work and operations of the sector at large. Fundamentally, to quote one New York Times article, getting “the do-gooders to prove they do good” must become a priority for NGOs if they are to continue to pursue their mandates.

Increasingly, NGOs are responding to this demand for greater accountability through the creation of self-regulatory mechanisms—this is happening throughout the world, with notable prominence in Asia and Africa. The concept of self-regulation, although varying in scope, reach and standards across different countries, is based on actors within the NGO sector developing their own norms of good governance and public disclosure, as well as setting benchmarks for good practice. This is being done in an attempt to weed out NGOs that do not function effectively—the very ones that are detrimentally affecting the entire sector.

I recently met with representatives from Credibility Alliance, a non-profit organization in India with the ambitious mandate of “improving accountability and transparency in the [Indian] non-profit sector through good governance.” My aim was to find out more about the self-regulatory framework, the Alliance’s operations, and its vision for the future.

Answers to the following questions were provided by CA Executive Director, Ms. Kanchan Tuli and CA Resource Mobilisation Executive, Mr. Robert Christopher. Thanks also go to Albert Maganaka.

 

Can you provide a one-sentence summary of Credibility Alliance?

Credibility Alliance (CA) is an independent, not-for-profit organisation that sets norms and standards of governance for the community of voluntary organizations (VOs) in India, in an effort to improve overall credibility in the industry.

I understand that Credibility Alliance was an initiative which emerged from within the voluntary sector in Indiacan you explain how this happened?

About 12 years back, the Indian media began reporting to the public various scandals that VOs were practicing—this led to a severe mistrust in the minds of the public and donors. A handful of VOs and grant makers debated with the media and the public about this, and over time a consensus grew that the VOs themselves needed to come together and develop systems for good governance and public disclosure. During the year 2000, about 100 VOs and grant makers came together to discuss this possibility. They sent out over 5,000 letters to Voluntary Organisations throughout India seeking VO opinions about the possibility of creating an Alliance to promote good governance and public disclosure norms. The majority of the VOs responded positively. Credibility Alliance was registered officially and began its operations in May 2004.

CA offers VOs two levels of engagement: accreditation and membership. What is the difference? How many accredited VOs and how many members does CA have at present?

Membership to the Alliance is based on a self disclosure of some basic information like accounts, annual activity reports and details about board members. There is no physical verification of the information received. In an accreditation, on the other hand, the information provided by the VO is verified by external assessors at the site of the VO. In both situations, if the process of disclosed information and verification is successful, the VO is granted a membership or an accreditation. Currently we have 350+ members and 200 VOs which have gone through the accreditation process.

So, is CA like a “policing” body to ensure good governance amongst VOs operating in India?

CA is not a policing body, but has been created to facilitate transparency and promote accountability and good governance. CA’s main task has been to develop norms for governance and public disclosure in the sector. It is not an agency or body that is licensed by the government to regulate non-profits—it is an initiative of the voluntary sector based on the concept of self regulation.

Do you believe that self-regulation within the sectora concept described by one scholar, Mark Sidel, as “The Guardians Guarding Themselves”will increase public confidence of VO work?

Yes, this movement of VOs will re-assure donors and the public that these VOs are serious about standards and quality of their service to civil society. This is where the accreditation process is important. The norms for good governance and public disclosure have been established after an intense consultation and consensus building. The norms will shortly be re-visited and revised as per the advice of the VOs. CA has never made a study if the existing norms ensures 100% corruption proof, but from the feedback collected over 5 years, VOs themselves have appreciated the norms in the sense that it has helped the organization grow in operational development and accountability. If a VO expresses appreciation, then it is understood the VO has serious intentions of being transparent and accountable to the public.

There are approximately three million NGOs operating in India at present. CA has a huge challenge ahead of it if it wants to get all VOs on boardwhat will help it on its journey?

The strength and long term sustainability of CA lies in the commitment of the VOs who desire to promote transparency and accountability in India. Partnerships with large donors will also be extremely valuable and essential. CA is attempting to create a partnership with the central as well as state governments in India so that a greater accountability in government funding to the sector is achieved. The road is long and littered with challenges, but with commitment, it will be possible. 

Where do you see the Credibility Alliance in 10 years time?

In the next 10 years the aspiration is that CA should have a large membership of between 25,000 – 30,000 organizations, and that most, if not all of them, will be accredited. In the long run, advocacy will be very high on CA’s agenda.

  1. In comparison, governments are held to account by society and through internal checks and balances inherent in democratic systems, and private organizations are kept in check by stakeholders and government regulations.