Logo of Phnom Penh Post newspaper Phnom Penh Post - Guilty by association: the inaction of donors and NGOs

Guilty by association: the inaction of donors and NGOs

Guilty by association: the inaction of donors and NGOs

The lead article in the Phnom Penh Post on March 15, 2002 - 'Fraud probe into human

rights group' - has sparked a bushfire.

This first story was one of exposure, followed by a serious article that tried to

explain the causes. It is now two months, another article and several Letters to

the Editor later, and still no remedial actions have been put into effect.

The problem is still there. Other 'problems' have emerged and in those cases some

action has been taken. But there is more to do in order to restore public confidence.

However, the analysts agree that "one bad apple doesn't mean the whole barrel

is rotten". (PPP March 29, 2002 p.9).

On the other hand, a PhD student who researched women's NGOs fears that "[there

is] a silence among all the NGOs, maybe because they are all doing the same thing".

(PPP April 26, 2002 p.10).

Another letter writer goes even further: "[...] donors and the local NGOs are

in collusion in hushing up ..."(PPP March 10, 2002 p. 13). In this comment I

take the point that most NGOs are OK but that indeed the NGO sector as a whole needs

to take remedial actions. What in fact can be done?

I also argue that although most sponsors do not 'turn a blind eye' they indeed should

take their role more seriously. What could they do?

Local NGOs are honest, but unfortunately, less informed outsiders might easily get

the impression that all NGOs are involved in fraud, corruption and mismanagement.

Karen Felden's letter (PPP April 26, 2002) is very strong in this view, but she is

not only unnuanced in her conclusion, but wrong in some of her examples.

I have known the NGO community for over a decade and was the team leader for an evaluation

of 10 human rights and democracy NGOs in 2000 (Cambodian HR & Democracy Organisations,

2001 Sida).

Most NGO leaders and staff are hardworking and motivated people who try their best

to change society for the better. However, there are indeed a few rotten apples and

this fact was common knowledge among the NGOs and donors. It was an issue of private

debate for years, but no one took action until the media reported on three consecutive

cases.

The fire hit the pan: the local NGO community, and in particular the human rights

and democracy organisations, are now very worried. When I recently spoke with Mr

Thun Saray, president of ADHOC, he indicated that at every meeting with NGO leaders

the issue of 'corruption' came up. NGOs fear a negative image will affect their work

and reputation.

But financial mismanagement is not the only, and surely not the most important, problem

encountered at local NGOs. If one problem is exposed, often a combination of other

problems comes out.

During the abovementioned evaluation it was found that each and every organisation

had its shortcomings in management and efficiency, but only a very few lacked financial

transparency. It is indeed a matter of "...those working in civil society should

have strong ethics" (Kim Hourn in PPP March 29, 2002 p. 9). Most leaders of

NGOs share that feeling, but do they feel responsible - and are they guilty by association?

They fear that this affair will cut funding. But the issue should not be fear for

funding cuts, but what measures the sector can take that will throw out the bad apples.

The sector needs to regulate itself and needs to expose those who are not adhering

to a set of standards and ethics that are commonly accepted. There are NGO criteria

for civil society organisations.

Unfortunately, even in the organisations that designed these, the rules are not enforced

in full. It is neglectful of the whole sector not to apply such rules. Of course,

insiders know that too often democracy is confused with absolute freedom, and organisations

or leaders are eager to protect themselves from scrutiny by their colleagues. But

now it is time for a change.

Kim Hourn said: "I think it is good that we should continue to accelerate the

reforms in civil society." (PPP March 29, 2002 p.9).

What reforms? The above mentioned evaluation has provided both NGOs and donors with

a tool to start a reform, but virtually nothing has been done by either side.

Sponsors knew all along that some rotten apples existed, yet this did not affect

their funding practices. For example, a large sponsor of one organisation currently

under investigation intended to cancel its funding but didn't do so. Why not? When

I asked the grantee how this could be, he frankly said that this decision was overruled

because of "my friends on the Hill".

This kind of protection could also be grounds for the inaction of the sponsor after

what has been reported in the media. Or are things going on behind closed doors?

Is there 'collusion'? I don't think so, but it is a fact that some donors 'turn a

blind eye', quoting the former advisor of the Cambodian Insitute for Human Rights

(CIHR), Mr. John Lowrie, who was instrumental in uncovering problems at the Institute.

It is ironic that Lowrie was forced to leave CIHR while the accused still holds the

wheel. Indeed, also in Cambodia a person is innocent till proven otherwise, or until

he escapes justice. Sponsors are not judges but they have responsibility to allocate

grants properly.

They are not guilty by association if financial mismanagement occurs. Or are they?

"There is little point in spending $1,000 on checking how $5,000 was spent,"

said one donor (PPP March 29, 2002 p. 8).

A director of a small NGO told me recently that when he asked his sponsor what to

do with the left-over funds of the previous year, he was told: "Use it as you

please."

During the abovementioned evalution we found that hundreds of thousands dollars were

granted to one NGO over a period of more than two years for a pilot project that

was implemented without keeping record of the process. The donor's desk officer said

that her "good relationship" with the director was sufficient proof of

accountability.

That no lessons or good practices could be learned, or spending of the funds could

be justified due to lack of records, seemed to be a small price for the good relationship.

The HR evaluation revealed many similar shortcomings of donors' behavior. It need

not be emphasised that such attitudes inspire the kinds of practices that are now

blamed on the NGO sector.

So what can the sponsors actually do? First, they should unambiguously throw out

the few rotten apples. No excuses! Second, they should review their own weaknesses

and avoid condoning bad practices. Instead they should encourage organisations that

might still have difficulty functioning in a Western 'efficient' manner, but have

a proven record of honesty.

Also they should 'collude' with other sponsors and arrange for joint audits and evaluations

of sponsored NGOs and make the findings public. And last but not least, they should

give up some of their granting freedoms and consult coalitions of NGOs about suitable

grantees. The latter would be pleased to check small grants of $5,000 without charging

$1,000 fees. Some sponsors have made some steps in this direction but they are still

too few to have an effect on the whole NGO sector.

- John L. Vijghen is the editor of the report series Cambodian Human Rights

& Democracy Organisations (16 volumes) published by Sida. He was the teamleader

of an evaluation among ten human rights NGOs, some of which are now under investigation.

Contact: [email protected]

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