NGO Accountability: The GRI NGO Sector Supplement

2010 Amsterdam Global Conference on Sustainability and Transparency

Academic conference presentation by Jeffrey UnermanThursday 27 May 2010

Overview of presentation

Key insights from academic research on NGO accountability

Brief overview of GRI NGO Sector Supplement

Comparison of sector supplement provisions with insights from academic research Suggestions of areas for future development in next version of

Sector Supplement

Key insights from academic research on NGO accountability

Upward accountability Primarily relates to efficiency of aid deployment Tends to comprise rigidly formatted accounts to funders

Downward accountability Primarily relates to effectiveness of aid deployment Requires accountability dialogue to understand needs and context

of beneficiaries And to understand the impacts of programmes in practice on

beneficiaries

Key insights from academic research on NGO accountability

Holistic accountability Multidirectional accountability to all stakeholders impacted by

NGO’s policies and practices

Donors/funders

Beneficiaries

Stakeholders impacting

Stakeholders impacted

NGONGO

Upward accountability

Downward accountability

Holistic accountability

Key insights from academic research on NGO accountability

Holistic accountability Multidirectional accountability to all stakeholders impacted by

NGO’s policies and practices

Appropriate accountability mechanisms Suited to each type of stakeholder That are not so onerous they compromise viability of the NGO

Donors/funders

Beneficiaries

Stakeholders impacting

Stakeholders impacted

NGONGO

Upward accountability

Downward accountability

Holistic accountability

Overview of NGO Sector Supplement

Launched earlier today

Supplement to GRI G3 guidelines Needs to be read in conjunction with G3 guidelines

Tailors several of the G3 guidelines and indicators to make them appropriate for NGOs

Introduces new ‘set’ of indicators to cover program effectiveness

Applies to a broad range of NGOs Clearly encompassing development and advocacy activities

Comparison of NGO Sector Supplement with academic insights

GRI NGO Sector Supplement is very welcome It has clearly been very carefully and thoroughly drawn up It clarifies a range of NGO responsibilities and the need to

practice holistic accountability Accountability to donors/funders Various roles of downward accountability in enhancing effectiveness Broader economic, social and environmental impacts of NGO

operations

As a 1st version it is probably about as advanced and comprehensive as is practical Perhaps subsequent versions might be able to go a little further as

concerns among some NGOs dissipate in light of experience of implementing this version

Comparison of NGO Sector Supplement with academic insights: areas for future

development 1. Greater clarification of role and meaning of stakeholders

Stakeholders for whom report is compiled and stakeholders in NGO’s activities Introduction to Sector Supplement (along with G3 guidelines) notes a

range of possible audiences for report, including affected stakeholders Affected stakeholders are focus of downward accountability processes

Affected stakeholders covers beneficiaries but also includes “those individuals, communities or causes that may intentionally or unintentionally be impacted positively or negatively by the work of the organization, and to whom specific accountability duties arise” This broad definition could lead to significant differences in practice

between affected stakeholders recognised/prioritized by different NGOs Thus impacting cross-NGO comparability in reporting, and demoting key role

of responsibility and accountability to beneficiaries So may need more detailed guidance on different types of stakeholders

Comparison of NGO Sector Supplement with academic insights: areas for future

development2. Restricting scope of NGOs to whom Sector Supplement applies

Introduction explains that while Sector Supplement primarily applies to large & medium NGOs, it could be used by any NGO Need to discourage small NGOs from engaging in inappropriate

forms of accountability that could require disproportionate resources

IE: for many NGOs, costs of formal reporting might far outweigh benefits (of self reflection, benchmarking etc) to society and stakeholders of formal reporting

Comparison of NGO Sector Supplement with academic insights: areas for future

development 3. Performance indicators for program effectiveness

These cover key areas that should, for example, encourage downward accountability, feedback mechanisms etc

But the indicators focus on reporting about systems/mechanisms rather then reporting the substance of the outcomes of these mechanisms This is intentional, as introduction states that the Sector Supplement ‘is

not intended for reporting on the actual findings of these processes. NGOs should report on such findings elsewhere’ But it is at variance with most GRI G3 indicators

This seems to be a missed opportunity for seeking to ensure consistency in reporting of actual program effectiveness – a crucial issue

It also seems inconsistent with other parts of the Sector Supplement EG: Environment states ‘where environmental protection is a primary focus

of the NGO’s program activity … more detailed information [should] be provided under … Program Effectiveness’

Comparison of NGO Sector Supplement with academic insights: areas for future

development 4 Greater clarity on sources of reporting demands

For example, in discussing overarching governance issues, the Sector Supplement states: ‘Transparency of the governance process … is seen to be of

particular importance by [an] NGO’s key stakeholders. It is the expectation of stakeholders that NGO decision-makers ensure that their organization reflects the diversity of the society in which they operate …’ Who are these ‘key stakeholders’? Who has decided which are the key stakeholders?

Data should be provided to more precisely support assertions of this nature Risks of imprecise data on credibility of whole process (eg: Climategate)

Comparison of NGO Sector Supplement with academic insights: areas for future

development 5. If diversity is a key issue, then the Sector Supplement could be

more robust and comprehensive in its definition of diversity At present defined as

‘diversity of all types (gender, ethnicity, age, etc.)’ This lack of a comprehensive list could enable an NGO to avoid

addressing other areas of diversity Such as disability, religion and sexual orientation Some of these issues might be challenging for some NGOs –

especially religiously based NGOs, but are nevertheless important so should be spelt out in the Sector Supplement

Conclusions

What is the likely impact of the GRI NGO sector supplement on NGO accountability in developing country contexts? Based on above analysis, the Sector Supplement is likely to be a

major factor in advancing downward and holistic accountability It sets appropriate expectations for reporting on these issues Reporting generates awareness and focuses attention

It seems pitched about right to get broad buy-in But there are some issues that should be bourn in mind for further

development in subsequent revisions of the NGO Sector Supplement Not least:

➩ greater clarity on: scope of stakeholders, scope of NGOs expected to report, demands for reporting, and definition of diversity;

➩ reporting on substance as well as mechanisms in program effectiveness