Instruments for improvement of Accountability and Governance in NGOs

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Marilyn Wyatt (Consultant, Prague)
Series of Internacional Conferences
Civil Society Organizations
Transparency and Responsibility
2nd Conference "Ethics, Transparency and Responsability"
Held at the Goeth Institut Lissabon
Organized by Humaneasy Consulting and Friedrich Ebert Stiftung Portugal
More at http://www.humaneasy.com/conf/

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  • Instruments for improvement of Accountability and Governance in NGOs

    1. 1. Instruments for Improving Accountability and Governance in NGOs Dr Marilyn Wyatt [email_address]
    2. 2. Key assumptions <ul><li>Good governance is as important for NGOs as for the public and private sectors </li></ul><ul><li>Boards have primary responsibility for organizational accountability </li></ul><ul><li>Boards themselves must act in accountable ways </li></ul><ul><li>Governance ≠ management </li></ul><ul><li>The same people do not serve in both functions </li></ul><ul><li>Conflict of interest and a lack of coherent approaches to governing are the main factors undermining board accountability </li></ul>
    3. 3. What will we cover? <ul><li>Basic definitions </li></ul><ul><li>Key areas for improving board accountability </li></ul>
    4. 4. <ul><li>Basic definitions </li></ul>
    5. 5. What is accountability? <ul><li>“ An obligation or willingness to accept responsibility or to account for one’s actions” Merriam Webster Dictionary </li></ul><ul><li>External accountability: </li></ul><ul><ul><li>Adherence to applicable regulations </li></ul></ul><ul><ul><li>Open dialogue with stakeholders </li></ul></ul><ul><ul><li>Information and transparency </li></ul></ul><ul><li>Internal accountability: </li></ul><ul><ul><li>Clear flow of authority </li></ul></ul><ul><ul><li>Checks and balances, especially in finances </li></ul></ul><ul><ul><li>Regularity in procedures </li></ul></ul><ul><ul><li>Avoidance of conflict of interest </li></ul></ul>
    6. 6. What is governance? <ul><li>“ To prevail or have decisive influence or control; to exercise authority” Merriam Webster </li></ul><ul><li>Vested in a clearly identified governing body, which is: </li></ul><ul><ul><li>Distinct from and independent of management </li></ul></ul><ul><ul><li>Engaged mainly in policy-making, monitoring and supervision, and long-term institutional development </li></ul></ul><ul><ul><li>Steward of the mission and resources </li></ul></ul><ul><ul><li>Usually has legal responsibility for the organization </li></ul></ul><ul><ul><li>Supervisor of one employee: the chief executive </li></ul></ul>
    7. 7. Basic structure #1 Governing Body Faculty and Staff Chair Governance Management Executive Director
    8. 8. Variation #1 Governing Body Faculty and Staff Chair Ex Dir Governance Management
    9. 9. Variation #2 Governing Body Faculty and Staff Chair Governance Management General Assembly Executive Director
    10. 10. Variation #3 Governing Body Faculty and Staff Chair Governance Management Supervisory Board Executive Director
    11. 11. Variation #4 Governing Body Faculty and Staff Chair Governance Management Founders Executive Director
    12. 12. Variation #5 Governing Body Faculty and Staff Chair Governance Management Mother Organization Executive Director
    13. 13. Variation #6 Governing Body Faculty and Staff Chair Governance Management Advisory Council Executive Director
    14. 14. Variation #7 Governing Body Faculty and Staff Chair Governance Management Govt. regulators Executive Director
    15. 15. Basic structure Governing Body Faculty and Staff Chair Executive Director Governance Management
    16. 16. 2. Key areas for improving board accountability
    17. 17. a. Statutes, bylaws, and policies <ul><li>Ensure adherence to regulatory environment </li></ul><ul><li>Offer coherent, consistent framework for action -- avoidance of “ad hoc-ism” </li></ul><ul><li>What’s the difference? </li></ul><ul><ul><li>Statutes give legal statues; describe organization’s purpose and structure </li></ul></ul><ul><ul><li>Bylaws elaborate the function and operations of board and its relationship with the executive director </li></ul></ul><ul><ul><li>Policies describe organizational goals and acceptable procedures for achieving them </li></ul></ul>
    18. 18. The importance of bylaws <ul><li>Document the flow of authority </li></ul><ul><li>Codify board duties and procedures </li></ul><ul><li>Define the board’s relationship with ED </li></ul><ul><li>Offer guidance for resolving uncertain situations </li></ul><ul><li>Promote collective leadership and continuity </li></ul><ul><li>Help build a strong institution </li></ul>
    19. 19. Core content of bylaws <ul><li>Mission </li></ul><ul><li>Names and duties of governing bodies </li></ul><ul><li>Their relationships to each other and ED </li></ul><ul><li>Duties of individual board members </li></ul><ul><li>Minimum number of board members; method of selection and terms </li></ul><ul><li>Conflict of interest policy </li></ul><ul><li>Meetings: frequency, convening, quorums </li></ul><ul><li>Decision-making procedures </li></ul><ul><li>Committees </li></ul><ul><li>Mergers, dissolutions </li></ul>
    20. 20. b. Avoiding conflict of interest <ul><li>Conflict of interest = Any situation in which competing personal interests are put above--or have the appearance of being put above--the interests of the organization </li></ul><ul><li>Prevalent when: </li></ul><ul><ul><li>NGO sector is ingrown </li></ul></ul><ul><ul><li>Public- and corporate-sector standards are lax </li></ul></ul><ul><ul><li>Public mistrust of NGOs is high </li></ul></ul><ul><li>Sector-wide ethical standards </li></ul><ul><li>Organizational values and ethical standards </li></ul><ul><li>Duty of loyalty of individual board members </li></ul>
    21. 21. Elements of a conflict-of-interest policy <ul><li>Offers impartial guidance for handling ambiguous, uncomfortable or unfair conflict-of-interest situations </li></ul><ul><li>Should include: </li></ul><ul><ul><li>Statement of purpose (definition, target audience) </li></ul></ul><ul><ul><li>Disclosure requirement </li></ul></ul><ul><ul><li>Appropriate behavior in case of conflict </li></ul></ul><ul><ul><li>Method of enforcing </li></ul></ul><ul><li>Must be a living document! </li></ul>
    22. 22. c. Board and ED evaluations <ul><li>Performance vs. organizational evaluations </li></ul><ul><li>Most important from the board’s perspective: </li></ul><ul><ul><li>Mission fulfillment </li></ul></ul><ul><ul><li>Sustainability </li></ul></ul><ul><ul><li>Leadership </li></ul></ul><ul><li>Sources of benchmarks: </li></ul><ul><ul><li>Job descriptions (in statutes, bylaws and contracts) </li></ul></ul><ul><ul><li>Agreed annual and long-term goals </li></ul></ul><ul><ul><li>Accepted standards and benchmarks </li></ul></ul><ul><li>Look to the future (what will we do next year?) as well as the past (how well did we do?) </li></ul>
    23. 23. Approaches to board-level evalutions <ul><li>Surveys, focus groups, and 360s </li></ul><ul><li>Outside assessment </li></ul><ul><li>Self-evaluation </li></ul><ul><li>Should be annual event </li></ul>
    24. 24. d. Annual board training <ul><li>Refreshes understanding of purpose and functioning of board </li></ul><ul><li>Creates space for goal setting and planning </li></ul><ul><li>Allows old members to reflect and new members to integrate </li></ul><ul><li>Encourages higher-level thinking and dialogue </li></ul><ul><li>Promotes social bonding </li></ul>
    25. 25. Sample retreat agenda <ul><li>Board roles and responsibilities </li></ul><ul><li>Board policies and procedures </li></ul><ul><li>Board’s relationship with executive director </li></ul><ul><li>Overview of programs and finances </li></ul><ul><li>Long-term issues and goals </li></ul><ul><li>Identification of board priorities for coming year </li></ul><ul><li>Signing of disclosure statement </li></ul><ul><li>Social event </li></ul>
    26. 26. Key board practices for better accountability <ul><li>Codify rules and expectations for behavior in writing </li></ul><ul><li>Aim for predictability, consistency, flexibility </li></ul><ul><li>Once the rules are written, enforce them </li></ul><ul><li>Insist on annual training and evaluation </li></ul><ul><li>Be serious about conflict of interest </li></ul>

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