Cs regulation part ii ngo codes of conduct


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Cs regulation part ii ngo codes of conduct

  1. 1. Part II: CSO/NGO Codes of Conduct1 IntroductionA code of conduct is an instrument of self-governance in which an organization or coalition oforganizations “…set down the standards of accountability and transparency which they holdthemselves to, and which they will expect to be held to by their staff, supporters and otherstakeholders”1 based on their core values and guiding principles. NGOs use voluntary codes ofconduct to address accountability issues through public commitment to “principles or standards ofperformance to which an organization or a group of organisations voluntary sign up and against whichthey are willing to be judged.”2 Generally speaking, NGO codes of conduct address the whole range ofaccountability issues including organizational management, project implementation, financialmanagement, participation, and information disclosure as well as structures and procedures forenforcement.1.1 Benefits of Introducing a Code of ConductDeveloping a code of conduct has various benefits at the organizational, coalition and sector levels interms of accountability, transparency, and legitimacy. More specifically, the establishment of andadherence to a code of conduct: increases credibility in the eyes of stakeholders; introduces greatertransparency in management and operation; provides clear standards of accountability; increasesperformance and effectiveness; enhances consensus on core values; and, enables efficient use ofresources.1.2 Forms/Types of NGO Codes of ConductNGO codes of conduct may be classified according to various characteristics. The most relevantamong these is their scope in terms of the number and profile of organizations intended to becovered. A code of conduct may be applicable to a single organization or a group of organizations. Inthe latter case, the profile of organizations may be defined in terms of a number of criteria including: Level of operation, i.e., local, sub-national, national, regional, international the sector in which they operate, e.g. health, education, food security, thematic focus, e.g. gender, HIV/AIDS, capacity building their organizational structure, e.g. membership, non-membership, their role within the civil society sector, e.g. donors, implementers,1 INGO Accountability Charter, User Guide2 http://www.casin.ch/web/pdf/ngoaccountability.pdf
  2. 2. Often times, two or more of these criteria define the scope of NGO codes of conduct, the mostcommon types identified as: sector-specific codes with international application; national codesapplicable across sectors; and; individual NGO codes (drawn up by individual NGOs). For the purposeof this document, the focus is on national codes applicable across sectors and profiles oforganizations.2 Areas Covered by a Typical Code of Conduct for NGOsThere are a number of organizational and external factors that influence the approach adopted by anorganization in determining the contents of a code of conduct for an organization. In the context ofa coalition, the profile of members and their shared values are important internal considerations. Theoperational environment for civil society in general is an important external factor that would informthe overall approach to accountability and the specific contents of a code of conduct. The goldenrule in this respect is that codes of conduct should be organization specific as well as custom madefor the environment in which the organization operates. Within these limits, codes of conductgenerally cover three major areas: a general section indicative of organizational aspirations; a detailed section setting down specific principles, rules and policies which members of the organization are expected to adhere to; and, a third section dealing with the management of the code of conduct including structures, procedures and standards for the implementation and enforcement of the substantive provisions.The level of detail under each of these major sections is determined by the nature and purpose of thecode. Generally, organizational codes are more detailed than coalition or sector level codes with themost general ones expected in international initiatives covering NGOs operating across broadsectors and levels of intervention. The rule is that the more common features shared among theorganizations, the more detailed the expected code of conduct.2.1 General ProvisionsThe general provisions of the code outline the context and basis for the development andimplementation of the code of conduct including its rationale and objectives (why), scope ofapplication (who are the subjects), and the underlying value framework (mission, principles, values).Oftentimes, this section also provides a list of definitions for important or repeatedly used terms aswell as other technical provisions as is common in legislative drafting. The rationale and objectives ofthe code of conduct may be presented in the preamble or as separate paragraphs at the beginningof the document.2.1.1 Rationale and ObjectivesThe decision to develop or subscribe to a code of conduct may come from a variety of sources.Internally, an NGO or coalition may decide to do so as part of a process in operationalizing its valuesand principles, to strengthen internal governance structures, address internal accountabilityconcerns, or build up their reputation in order to increase acceptance of state and other key
  3. 3. stakeholders. It may also be the case that external influences arising within the civil society sector,such as changing practice, may highlight the need for a code of conduct. In many cases, the reasonhas to do with a response to accountability concerns raised by donors, governments and otherstakeholders.The overall goal of developing a code of conduct is to provide an appropriate framework fororganizational accountability by setting standards of performance for effectiveness of NGOs in thequantity, quality and responsiveness of their activities; independence, transparency and reliability oftheir institutional structures; adherence to their mission as well as to a set of core values, guidingprinciples, and policies.3 To this end, a generic list of specific objectives for an NGO code of conductincludes: setting or restating an organization’s vision, values and guiding principles; establishing anaccountability framework that clarifies roles, responsibilities and decision making processes; definingstandards of acceptable professional behavior; and, providing benchmarks for evaluation andreporting.2.1.2 ScopeThe scope of application is a provision clearly identifying who will be governed by the provisions ofthe code of conduct. For organizational codes, this section should clearly state whether the codeapplies at the level of governance (board), executive, staff, volunteers, affiliates, etc …4 In the caseof coalitions or groups of NGOs, the application of the code of conduct is normally subject to avoluntary but formal procedure wherein an organization undertakes to be bound by the provisionsof the code. Thus, even if the code of conduct is intended to be applied to a known profile oforganizations, such as NGOs providing health services in a locality or partners of an organization, thescope of application provision should indicate how organizations enter such formal commitment.Another consideration in setting the scope of application for a code of conduct in the context ofcoalitions or groups of NGOs is the level of diversity among intended subjects of the code. Oneshould specially make sure that the intended subjects are too diverse to permit anything but generalrules. As the concept of “civil society” refers to a wide range of different actors, with specificinterests, incentives and challenges, the value of developing a generic all encompassing code ofconduct for organisations as diverse as NGOs, trade unions, cooperatives, social movements, faith-based organisations, etc… may be minimal.5 If such be unavoidable, as is the case for umbrellaorganizations, one may consider separate provisions applicable to the different categories or thedevelopment of subsequent codes. The development of organizational codes of conduct as astipulation in the coalition code may also be considered.2.1.3 Vision, values and guiding principlesAccountability implies that organisations focus on fulfilling their mandate and serving the needs oftheir beneficiaries. The code of conduct provides an opportunity to clarify the role of the CSOs/NGOs3 Marie Chêne, Developing a code of conduct for NGOs, U4 Expert Answers, Transparency International, 27 April 20094 Transparency International for example has developed a specific Code of Conduct for both its Board Members (http://www.transparency.org/about_us/organisation/board/conduct_board), and its International Secretariat’s staff members (http://www.transparency.org/content/download/21055/305503).5 Marie Chêne, Developing a code of conduct for NGOs, U4 Expert Answers, Transparency International, 27 April 2009
  4. 4. in a concise manner. While this is more common among organizational codes of conduct, identifyingthe vision, mission, and guiding principles of a coalition or group of organizations is also important interms of defining their shared profile. This will not only provide prospective members with a clearidea of the identity of the coalition or group they are about to join but also enable consistency anduniformity in the development and implementation of the code. This can be done by formulatingexplicitly the vision of the coalition, developing the vision into a more detailed mission statement,and describing its goals and purpose in a concise and accurate manner. Then, the core values arelisted in order of importance to the organization, starting by the most essential ones. The list of corevalues should not be too long so that they can be easily remembered.Codes of conduct should also capture the fundamental values of the organization or group oforganisations, identifying those that are the most essential to accomplish their goals and objectives.Most codes of conduct commit to adhere to values linked to human and social rights, such asdemocracy, nondiscrimination, justice, equity, and transparency. As opposed to detailed behavioralrules, the guiding principles describe the general principles that the organization or group oforganisations are committed to respect and that inspire its/their daily operations. These guidingprinciples provide the basis for detailed standards of conduct in the substantive section of the code.They are also useful to help external stakeholders identify the general rules and principles that willgovern their interactions with the organisations governed by the code. These guiding principlesoften include a commitment to principles of neutrality, objectivity, honesty, transparency, openness,respect for fundamental rights and freedom, impartiality, participation, and professionalism.2.2 Specific Rules and PoliciesThe nature, scope and level of details of the specific rules may greatly depend on whether the code ismeant to govern an individual organization, a group of sectoral organisations or a coalition ofnational organisations working in different fields. In the latter cases, specific rules are likely to beformulated in broader generic terms so that they fit the circumstances of the different memberNGOs.Codes of conduct should generally establish the overall institutional conditions that are conducive toethical behaviours through a set of practical principles and policies as well as internal governancerules. These policies seek to ensure that a strong oversight board independent from management isestablished, that decision making processes are transparent and open to scrutiny, that remunerationstructures and employment conditions are fair and merit based, etc.2.2.1 Internal governance rulesAn accountable organization has a functioning system of internal governance. The English word“governance” comes from the Latin word meaning “to steer, guide, or direct.” The term generallyrefers to the way in which power is assumed, conveyed, and exercised within a society or anorganization. The Working Group on NGO Governance in Central and Eastern Europe defines goodgovernance as “a transparent decision-making process in which the leadership of a nonprofitorganization, in an effective and accountable way, directs resources and exercises power on thebasis of shared values.”An organization exercises good governance when it has an internal systemof checks and balances that ensures the public interest is served. Good NGO governance is based onthe distinction between organizational entities (management and the governing body) and thedistribution of decision-making power between them. This arrangement helps restrain and moderate
  5. 5. the control of any one person or group, ensure the organization’s resources are well managed, andsafeguard the NGO’s public-service orientation.Internal governance rules may cover issues such as transparent and democratic rules and proceduresgoverning appointments and elections, terms of office, and balanced regional or genderrepresentation. At organization level, such rules may explicitly cover the role and composition of theboard, management structures, hiring and firing practices to promote both democraticrepresentation and accountable institutional structures. Usually, these issues are dealt with in thebasic document of the organization in accordance with legislative requirements.In codes of conduct developed for a coalition or group of CSOs/NGOs internal governance rules havedual meaning: rules governing the governance of member organizations, and rules for thegovernance of the coalition/group. The concern here is the former with the latter to be dealt with inthe implementation and enforcement section of the code. The code of conduct should set down thestandards for good governance at the organizational level.2.2.2 Accountability RulesAccountability rules consist of provisions aimed at ensuring accountability to the organizations’stakeholders. Codes of conduct stipulate standards for accountability such as regular reporting,financial independence and transparency, sound financial management and accounting, annualaudited financial statements, and annual general meetings. The concern here is ensuring that allstakeholders are identified, their respective stakes clarified and appropriate mechanisms put inplace. Ideally, this involves addressing the four key questions of accountability described earlier –who, to whom, for what, and how, as well as a possible fifth – with what outcome? The following isone example: The Humanitarian Accountability Partnership International (HAP-I): organizations providing emergency relief are accountable to the people affected by the crisis, for the effectiveness of their relief in helping the people live a life with dignity, by creating a variety of mechanisms including a self-regulatory watchdog, with the aim of strengthening the humanitarian sector and thus bettering the lives of the affected populations.Since ‘upward accountability’ to donors and governments is governed through contractual and legalstipulations, codes of conduct should emphasize ‘downward accountability’ to beneficiaries. Oneapproach in achieving this is “democratic accountability” or “stakeholder democracy” where allstakeholders in an organization or activity have the same opportunity to govern that organization oractivity. The stakeholders with less power, i.e. beneficiaries, are identified as the primarystakeholder.6 This is called “proportional accountability”7, meaning that the amount ofaccountability should be determined by the amount of affectedness of the group demandingaccountability. The concept of dependent affectedness goes further in addressing the relative powerof different affected groups or persons, suggesting that their dependence on the outcome of an6 Therefore democratic accountability can be defined as the quality of being accountable to those with less power who are affected by one’s actions or decisions, when they in turn exhibit the same accountability, where accountable means both justifying to and being regulated by those to whom one is accountable.7 Van Rooy (2004)
  6. 6. issue for the fulfillment of their basic rights should be a yardstick for determining the validity of theiropinion on that issue. To clarify, this “democratic accountability” can be described by answering thefour accountability questions as follows: Who is accountable? The person or group that affects some relatively less powerful person or group. To who? To the person or group they are affecting. For what? For the effect they have on them, particularly if negative. And how? In a way where the person or group affected can change the behavior of the person or group affecting them (with the affected also becoming accountable to any third parties they affect when exerting this influence).Another more widely applied mechanism effective in ensuring downward accountability tobeneficiaries is found in the promotion of participatory methods of assessing development projectplans and experience.2.2.3 Rules of Professional ConductRules of professional conduct set out clear standards governing the behavior of CSO/NGO personnelincluding prohibited and expected behaviors in a range of situations. These rules typically constituteguidelines with regard to situations wherein concerns may arise in professional relationships withstakeholders. The most notable among these relate to the giving or receiving gifts, entertainmentand hospitality, travels, post employment, confidentiality, and non-preferential treatment of familiesand friends. In this regard, it is particularly important that codes of conduct layout a framework forremoving or making transparent conflicts of interest and reducing opportunities for misconduct.These provisions address situations where the private interest of a staff or a member of theorganization interfere with the interests of the organization and can affect the objectivity ofprofessional behaviors. At the organizational level, these issues are ideally addressed in a conflict-of-interest policy. Codes of conduct developed within coalitions or groups of NGOs may stipulate briefrules of professional conduct, stipulate that member organizations undertake to develop anorganizational code of conduct, and provide for the expected form and content. NGO Governance Handbook: What is conflict of interest? Conflict of interest is a situation in which outside interests affect or are perceived to affect the ability of an individual to make fair and impartial decisions on behalf of the NGO. Conflict of interest can exist when opportunities for direct material gain are involved (also known as “self-dealing”); when close associates or family members stand to benefit; when personal, professional, or other affiliations interfere with fair and impartial judgments; or when personal interests or loyalties conflict and compete with those of the NGO. Conflict of interest can be both real and perceived: it includes situations in which self-interest seems to play a role even if no actual wrong-doing is involved.Provisions on conflict of interest may, for instance, stipulate that conflict-of-interest policies shouldbe adopted addressing these elements: Statement of purpose. The policy states what’s meant by conflict of interest and whom it affects.
  7. 7. Guidance for conduct. Board and staff members are required to disclose any real, perceived, or potential conflict right away. They should be banned from taking part in discussions and decisions involving situations in which they or their family members and associates could benefit in any direct or indirect way. Annual disclosure. Board and staff members sign statements acknowledging their awareness of the policy and identifying any real or potential conflicts they might be involved in.2.2.4 Complaints proceduresThe code of conduct should also provide for the establishment of complaints procedures towardsexternal and internal audiences to facilitate the reporting of wrongdoing or actions perceived to beagainst the standards of the code. Where appropriate, this may be achieved by designating anombudsman mandated to respond to the stakeholders’ concerns and ensure that organizations stayfocused on their respective mandate, mission, values and principles. A critical issue in putting in placea complaints procedure within a code of conduct is the protection of whistleblowers. There shouldbe credible and reliable mechanisms in place to protect the professional and personal interests ofwhistle blowers.2.3 Implementation and enforcementNot all CSO/NGO codes of conduct have implementation and enforcement provisions. In fact, theabsence of these provisions is a key weakness cited in relation to self-regulation initiatives in generaland codes of conduct in particular. The Red Cross Code of Conduct, for instance, has no mechanismsfor verifying whether signatories comply with the code, and no means by which a breach of the codecan be reported.8 The South African NGO Coalition’s (SANGOCO) Code of Ethics, on the other hand,gives no indication of what will happen if an NGO fails to comply, and that there is no evidence of anyorganization being disciplined to date.9 While self-regulation inherently involves a voluntary aspect,what organizations volunteer to do is undertake to be bound by the rules set forth in the code ofconduct. This commitment should give rise to a set of enforceable obligations once formallycommitted. Otherwise, the code of conduct cannot achieve its core purpose, accountability. In theabsence of an enforcement mechanism, compliance may occur only among those most committedto the code.The implementation and enforcement section of a code of conduct contains provisions that explicitlyand specifically address implementation challenges and establishes adequate implementationmechanisms. This starts with putting in place the necessary implementation structures andprocedures. Ideally, the code should make provisions for somebody to be in charge of the codesimplementation and reporting thereon in each participating organization, ideally a credible ethicsadvisor that enjoys the trust of organization’s staff and members. There should also be provisions toensure for a second instance and/ or alternate channels in case the role of the ethics advisor be8 International Federation of Red Cross and Red Crescent Societies (2004) ‘Code of good practice for NGOs responding to HIV/AIDS: sign on implementation and accountability: options and recommendations’, IFRC, Geneva (available at: http://www.ifrc.org/what/health/hivaids/code/files/options_paper_sign_on_implementation.pdf)9 E Hariss-Curtis (2002) ‘NGO codes of conduct: and exploration of the current debate’, in INTRAC Informed, Bulletin 5, November, pp2-11. (available at: (http://www.intrac.org/Intrac/docs/5Informed.pdf)
  8. 8. compromised (because her/himself in conflict of interest). There is also a need to develop animplementation strategy that can be linked to other staff development initiatives such as training.Successful implementation also requires a reporting mechanism, independent evaluation of thesuccess of implementation, independent compliance mechanisms and in some case the threat ofpublicity if the code is broken. Effective implementation of the code in practice also greatly dependson the nature of the oversight mechanisms in place to monitor compliance, detect and investigatebreaches of the code. The decision-making process for deciding whether an employee has breachedthe code should be open, fair and transparent.Good codes of conduct not only identify standards of behaviors but also spell out consequences toapply in cases of breach, demonstrating willingness to take action in case of non-compliance with thecode’s provisions. In addition to sanctions, one could introduce a system of positive incentives toreward staff and members that adhere to the code of conduct in an exemplary manner. Then, thecode should stipulate measures to enhance adherence to its provisions. The first prerequisite foreffective implementation is that the target audience needs to be aware of the existence of the codeand have sufficient knowledge of its provisions. The adoption of a code of conduct should also besupported by awareness raising activities, such as the wide dissemination of the code to the targetaudience and stakeholders, and training sessions. The regular assessment of the code’s impact is acrucial element of the enforcement regime, with regular reporting mechanisms, analysis ofcomplaints made, and regular reviews.3 Process of Developing a Code of Conduct for NGOsThe success of an initiative to develop a code of conduct for a coalition or group of CSOs/NGOs reliesto a large part on the target audience embracing the standards which the code of conduct promotes.That is, a successful code of conduct is one that is grounded on a strong constituency with sharedvalues and objectives. That is, broad organizational representation and collective input are likely topromote effective implementation. Moreover, the development process of the code provides aunique opportunity for organisations to discuss common values, mission and obligations.It is critical to engage the right people in the development process. Acceptance and understandingof the code’s underlying values are likely to be higher if the code is not imposed on the people whowill be affected by it but developed through a participatory process with the active involvement ofthe various stakeholders, either directly or through representatives. It is therefore advisable toconsult key stakeholders, particularly the organization’s beneficiaries, throughout the developmentprocess. As NGOs are ultimately accountable to their beneficiaries, it is advisable to involve them inthe code’s development process and give them the power to hold the NGO accountable for itsactions.For the organization, it’s a good and constructive way to get feedback from external constituencieson what is seen as the mandate and obligations of the organization. It is also a way to communicatethe organization’s values and principles to the outside world. The document should ideally beapproved at the highest level of the organization to give it credibility. The managers should also beseen as adhering to the highest rules of ethical conduct and behaviors.The development does not stop with the production of the code and many codes continue to bedeveloped after they are adopted. Codes of conduct should be seen as living documents, whichevolve with the shape and challenges facing the organization.
  9. 9. 4 Conclusions: Assessment StandardsThe following are the key assessment standards/issues emerging from discussion of the basis,purpose and contents of CSO/NGO codes of conduct: 1. General a. Is the code of conduct relevant to the CSO context in Ethiopia? i. for the legislative /mandatory regulation framework for CSOs in Ethiopia? ii. for the profile and membership of CCRDA? iii. the number and profile of organizations intended to be covered? b. Does the code of conduct have all the relevant sections? i. general section indicative of organizational aspirations; ii. a detailed section setting down specific principles, rules and policies which members of the organization are expected to adhere to; and, iii. a third section dealing with the management of the code of conduct including structures, procedures and standards for the implementation and enforcement of the substantive provisions. c. Is the level of detail under each of these major sections appropriate for the nature and purpose of the code? 2. General provisions a. Does this section of the code of conduct cover the relevant issues? i. its rationale and objectives (why) ii. scope of application (who are the subjects) iii. the underlying value framework (mission, principles, values) iv. definitions for important or repeatedly used terms b. Are the general and specific objectives properly designed and presented? i. clearly stated ii. relevant c. Is the scope of application properly designed and presented? i. clearly stated
  10. 10. ii. relevant in the context of the regulatory framework iii. appropriate to CCRDA (criteria and profile of membership) d. Are the shared visions, missions, principles and values properly designed and presented? i. stated clearly and in sufficient detail (additional principles and values that should have been included) ii. relevant in the context of the regulatory framework iii. appropriate to CCRDA (criteria and profile of membership, vision, mission, principles, values)3. Specific rules and policies a. Does this section of the code of conduct cover the relevant issues? i. Internal governance rules ii. Accountability rules iii. Rules for professional conduct iv. Complaint procedures b. Are the rules on internal governance properly designed and presented? i. stated clearly and in sufficient detail (separation of management and governance, transparent and democratic rules and procedures governing appointments and elections, terms of office, and balanced regional or gender representation) ii. consistent with the general provisions of the code iii. relevant in the context of the regulatory framework (CSP stipulations on internal governance structures, mandates, processes and standards) iv. appropriate to CCRDA (constituting documents of CCRDA and potential members) c. Are the rules on accountability properly designed and presented? i. stated clearly and in sufficient detail addressing the key elements of accountability (downward and upward accountability; mechanisms such as regular reporting, financial independence and transparency, sound financial management and accounting, annual audited financial statements, and annual general meetings; participatory measures)
  11. 11. ii. consistent with the general provisions of the code iii. relevant in the context of the regulatory framework (CSP stipulations on upward and downward accountability) iv. appropriate to CCRDA (profile of CCRDA and potential members, i.e. charities and societies) d. Are the rules on professional conduct properly designed and presented? i. stated clearly and in sufficient detail (clear standards of behavior-permitted and prohibited - in a range of situations; conflict of interest; organizational code of conduct) ii. consistent with the general provisions of the code iii. relevant in the context of the regulatory framework (CSP stipulations on officers; conflict of interest in the regulation) iv. appropriate to CCRDA e. Are the rules on compliant procedures properly designed and presented? i. stated clearly and in sufficient detail (for external and internal stakeholders; designated ombudsman; protection of whistleblowers) ii. relevant in the context of the regulatory framework (CSP stipulations on mandatory disclosure of misconduct?) iii. appropriate to CCRDA4. Implementation and enforcement a. Does this section of the code of conduct cover the relevant issues? i. Implementation challenges ii. Mechanisms for implementation iii. Enforcement provisions b. Are implementation challenges clearly identified and addressed? c. Are the mechanisms for implementation properly designed and presented? i. stated clearly and in sufficient detail (structures and procedures; responsible persons; alternate channels; implementation strategy; reporting mechanisms) ii. consistent with the general provisions and specific rules of the code
  12. 12. iii. relevant in the context of the regulatory framework iv. appropriate to CCRDA (profile of CCRDA and potential members) d. Are the enforcement provisions properly designed and presented? i. stated clearly and in sufficient detail (non-compliance reporting mechanisms; consequences to apply in cases of breach; a system of positive incentives; awareness and dissemination; assessment and review of the code) ii. relevant in the context of the regulatory framework iii. appropriate to CCRDA (profile of CCRDA and potential members)5. Process of development a. Evidence of a process involving analysis aimed at addressing the four key questions of accountability described earlier – who, to whom, for what, and how, as well as a possible fifth – with what outcome? b. Establishing shared values among intended subjects of the code c. Engagement of all stakeholders, especially beneficiaries d. Approval at the highest levels