By Devaprakash Ramakrishnan
Devaprakash Ramakrishnan is a Development Specialist with a deep interest in development finance, CSR and making markets work for the poor with a strong focus on private sector participation. Dev is an Agro-economist and lives in Chennai.
The Indian charity market is a $10 billion one dotted with both domestically grown civil societies and locally registered foreign charities. These foreign charities are popularly called International Non-Governmental Organisations (INGOs). Over 3.3 million Non-Government Organisations (NGOs) and Voluntary Organisations were mapped in 2015 by Central Bureau of Investigation, with only 10% of them filing audited accounts before the competent authority. The Home Ministries’ act of slashing down the number of NGOs receiving foreign money left only 5,845 NGOs in the fray in December 2016.
The growth of NGOs in India is the fallout of governance gap, the emergence of entrepreneurial spirit and growing hiatus between rich and poor, with the number going up astronomically during humanitarian crises. Though government contributions to NGOs amount to only approximately INR 1,000 crore out of the INR 26,500 crore that they generally receive from abroad, under the General Finance Rule of 2005, the Government has the mandate to audit the NGOs.
Caught up in a cult of corporatisation
While local NGOs are desirous of growing in professionalism, the INGOs are falling prey to increasing corporatisation. INGOs suffer from various issues, such as inequity in salary levels between staff, an overload of outsourced functions, being run by CEOs who are disconnected with the social sector and possessing incongruent fund-raising units. All of these problems syphon away the zeal with which NGOs come into existence and they start to become less relevant and accountable.
Imperilled governance
The way NGO Boards are constituted leaves much to be desired, with chairpersons having a final say on bringing in people of her/ his choice. Possible worries for INGOs include a dormant Board which oversees average management, non-renewal of licenses, unreconciled financials with poor financial controls, seething program quality issues (which has ramifications on poor accountability). It is not uncommon to see Board members enthusiastically bringing in corporate money into the charity. This is problematic as it leads to them facing accountability obligations from the corporate and charity side, both. INGOs largely enter into sub-grantee agreements with local NGOs. This helps in field implementation of policy. However, the local partner NGO and the Board will often struggle to fathom the complex on-ground issue involved and miserably miss connectivity to ground level operations. A new provision mandating Board members to refund the grant amount with 10% interest upon misuse will impose accountability in an individual capacity and is thus a move resisted by the NGO community.
Leadership woes
Most NGOs struggle with leadership planning, making them a one-man show. It is also common to see governance and management being mixed, for eg: thrusting blood relatives and familiar faces into the boardroom as rubber stamps; something which is happening in the INGO space as well. As the organizational ladder moves up, there is invisibility of gender and lack of diversity in rank and file. This is ironic, as NGOs meant to address such inequities in society by practising what they preach.
Rues of cannibalism and unhealthy competition
Cash-strapped local NGOs are put into tight spots when faced with the compulsion of competing with INGOs for grants. This does not give them a level playing field when compared to professionally managed INGOs who can afford to pay big cheques and cherry pick the best talent from the sector. The pledge taken in the historical Istanbul’s World Humanitarian Summit through the Grand Bargain in 2016, cries for committing at least 25% funding to local NGOs to perk up from the current pitiable level of mere 2%.
While there is scope for charities to demonstrate more accountability and move towards results-based programming, it is imperative that they subject themselves to a ‘social audit’ and introspect about their internal conduct. The Government should learn to work with charities and allow them to question policy-gaps and deprivations; lest India will face the danger of being likened to countries like Saudi Arabia, China and now Russia. Rights and entitlements of citizens can be unlocked only when civil societies flourish by questioning poor governance and resisting state failures.
Featured Image Source: Google Images
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