The Charitable Measurement Initiative

Keystone's Study of Social Marketplaces

2008-02-20T17:58:00.000+05:30

Our friends ate Keystone have just published a remarkable study of social market places that is available at: www. keystoneaccountability.org/node/159.

It tracks and examines the growth of online philanthropic marketplaces and their potential to create an informational basis for results-oriented giving and encouraging greater accountability. The study finds that while there is great potential and the marketplaces are doing remarkable work, there is still a need for clear criteria to determine effectiveness and impact.

It's a long read but worth reading through during train rides.

Franziska Zeiner's Blog on Indian NGOs

2008-02-17T18:05:00.001+05:30

Our friend and co-worker Franziska Zeiner is creating a photo-blog capturing many NGOs in India. There are great photos and excellent commentary. If you are interested in finding out about Indian organizations that could use some support, this is a great reference.

http://clicksonngos.blogspot.com

Interview with Fay Twersky

2008-02-12T17:01:00.000+05:30

http://www.alliancemagazine.org/online/html/aonov07a.html

Here is a link to a Fay Twersky interview from November 2007. It discusses some key issues related to impact measurement. Ms. Twersky is Director of Impact Planning and Improvement at the Gates Foundation and has great insight on the topic.

Allowing for Growing Pains

2008-02-11T13:25:00.000+05:30

Some preliminary feedback on our reports suggests that we may need to make two forms of reports, one for HNIs and one for corporate donors. The HNI reports need to be shorter and more anecdotal. The corporate reports need to be closer to financial disclosures.

We have generally leaned toward the corporate model, shying away from photos and anecdotes because we don’t want to encourage that type of behavior. Also, it is difficult to verify such stories unless we actually listen and make a record of those stories. It would be great if we could, but given our resource limitations, we are trying to figure how to “humanize” our reports without having to reply on the NGOs for their stories because we can not be 100% certain that they are correct.

One of the dangers in measuring the effectiveness is that it might dissuade the innovativeness of the projects funders are prepared to support. Measures if not tailored correctly will be overly harsh on new groups as they test out new interventions and approaches to solving problems. If this is calculated without some leniency for such innovativeness these organizations will look worse and donors may shy away from them.

Thus, measurement standards must strike the right balance between innovation and effectiveness. This means that means that measurement frameworks, especially in the beginning of an organization’s life, must to be tailored to allow for innovation. As a organization grows and matures, more stringent measurement criteria can be applied.

The key point is that a “one-size-fits-all” approach will not work.

Tailoring Reports for Different Donors

2008-02-08T18:13:00.000+05:30

Good idea but maybe think about what people actually need?

2008-02-07T23:09:00.000+05:30

I was on Facebook today when a pop up add came up with a picture of a young Indian girl and said "24 Hour Famine". So I googled it and it turns out that World Vision is asking people to get sponsored "to go go without for 24 hours, so that someone else doesn’t have to." The idea is to raise funds and awareness for a new project they are doing for street children in Chennai.

While I applaud their efforts -- which are laudable -- it is proper nutrition rather than starvation that is an issue in India. I point this story out only as an example of what we have seen with foreign organizations in India. They often intervene with the best of intentions but with preconceived notions of what should be done. And those preconceptions often are incorrect and therefore lead the organization astray.

This is why it is not only important to consult with experts but also with stakeholders and beneficiaries. They will give you a better picture of the problem and correct misconceptions.

NY Times Article on Education Highlights Major Issues

2008-02-06T23:17:00.001+05:30

Here is a NY Times article on education in India. It points out some of the issues we have seen in India: (1) mistrust of public education; (2) consumer driven culture; (3) increase in the cost of living; (4) lack of attention to the rural problems; and (5) middle class resentment of helping the poor.

http://www.nytimes.com/2008/02/06/world/asia/06school.html?_r=1&oref=

Donors' Level of Engagment Is Crucial to the Success of Unrestricted Funding

2008-02-05T11:39:00.000+05:30

“If it happens without intermediation, our experience shows that it rarely succeeds because donors don't have that kind of time to engage in detailed discussions[.]”

That is a quote from one of the groups we trust the most. We asked them whether from the beginning we would be able to go for unrestricted funding and what he thought of the concept. Their belief was that it would only be possible if the donors were willing to take up a lot of the monitoring role and be actively involved because otherwise it would be very hard for the donor to judge success at some future point in time. Their point was that they believed that the donor would not be satisfied with a report one year later detailing the use of his or her money if there wasn’t some predetermined way to measure the use through a project or target.

This comes from a respected group so we are taking it very seriously. However, our belief is that we can get donors to understand that they are funding social change and are part of this process of change. This process requires flexibility and non-project based funding to target a range of conditions. And through our discussions and reports, we hope to encourage such a system/relationship.

We do believe we can get donors to be satisfied with such reports one year later, but the concern expressed in the quote is valid. For this to work, donors are going to have to have the time to engage. What we need to do is make that time as little of a burden as possible.

Additional Concerns about Unrestricted Funding

2008-02-04T12:02:00.000+05:30

Here are two other concerns that were passed on to us:

(1) Because most donors do not proactively ask for the full set of the NGOs accounts, they are unlikely to be able to identify duplicate allocations. We need to make sure that donors understand this problem and ask for the information. But because they probably do not have enough time to look over many records, either we will have to do it to provide assurance or train them how to do so. Ideally, we would like them to do it because it fosters a closer and more involved relationship, but practically, I don’t think it will happen until further into the relationship.

2) NGOs sometimes fail to utilize their funds at all if they are not tied to a specific project. For example, when NGOs raise money through fundraising efforts that yield unrestricted funds (like from marathon sponsorship), they often hold on to that money in a corpus account or try to spread it over the course of the year. While it may be necessary in certain cases, we do want to encourage funds to be used and not sat upon. There is always a chance of misuse or underuse when funds sit for a while.

Concerns about Unrestricted Funding

2008-02-02T08:00:00.000+05:30

Another concern that we have heard several times is that unrestricted funds often lead to misuse, especially duplicate allocations (where more than one donor is given reports of the same project). We have heard stories of where this has happened with some of the most reputed large NGOs.

In its most innocent form, it is done so that funds earmarked for one project are used temporarily for another and later when additional funds come in, they original project will be completed. This happens most often when an NGO has definite income coming to it, but because of some problem with a project, is forced to scramble a little. The more serious form is outright fraud.

We do not approve of either of these forms. What we want is open discussion and some element of unrestricted funding that allows for discussion as to what needs to done to solve social problems with flexibility to cope with problems that pop up.

Like we mentioned in our last post, we are seeing a strong tension between unrestricted funds and honest usage and reporting. Based on what we are hearing, at least initially, there will have to be some form of restriction.

Intermediaries’ Complaints about NGOs

2008-02-01T16:59:00.000+05:30

Having had discussions with intermediary people and organizations (that is, groups like CMI) who have overseen many donor-NGO projects in India first-hand in the last 1o years, it is clear that their overall impression is that many Indian NGOs do not respect the freedom that comes with unrestricted money. The most common complaint is that many NGOs are not proactive in engaging donors and do not communicate to donors the challenges that the organization will or could face. They also complain that there is little to no meaningful stakeholder dialogue on an ongoing basis. As a result of these failures, the intermediaries say that they have often seen that even when NGOs receive money they do not take reporting seriously unless future disbursements are linked to reports. Without some sort of punishment, they fear that NGOS just won’t report honestly and complete and will not develop an honest relationship with their donors.

Based on this fear we are rethinking what it exactly means to get unrestricted funds. If we take these fears seriously, then purely unrestricted funds are unlikely to work or encourage the type of interactions and dynamics that we would like to see.

Our current thinking is that there will have to be strict timelines and reporting obligations, all of which are clearly outlined in a MOU signed by the NGO and donor and use an intermediary (like Give) to facilitate some of the exchanges.

The key will be doing so while giving the flexibility to use funds as may be needed. Clear project guidelines with clear timelines are easier to monitor but they handcuff the NGO and we believe are not the best for meaningful, sustainable development. While we would ideally encourage active donor-NGO engagement so that the donor takes up some of the monitoring and the NGO is responsible for frequent reporting, it is impractical because the donor is unlikely to have the time. Therefore, it is likely that initially the funding will have to be loosely restricted and as trust builds, the funding will become more unrestricted.

Fundraising Information

2008-01-31T07:10:00.000+05:30

The Showcase of Fundraising Innovation and Inspiration website has some interesting information on various fundraising campaigns and other interesting fundraising information.

http://www.sofii.org/

Excellent Article on the Third Sector in India

2008-01-30T23:58:00.000+05:30

I would like to recommend an excellent article on the third sector in India that discusses and helps to explain some to the unique challenges that such organizations face in India and how they are different from other countries, especially those in the West.

The Problematic of Third Sector and Civil Society in India: Some Reflections, Sreedhara T.N. and Rajarama Tolpady, Journal of Karnataka Studies, Vol. 2, No. 3 & Vol. 3, No. 1, May2005-April 2006, pp. 19-59.

Indian Tax Law Issues

2008-01-29T09:06:00.000+05:30

One thing that I am noticing that will be a bit tricky is the tax exemption that donors will get for their donations. Under Indian law, the exemption is generally under either Section 80(G) or Section35AC. Donations under 80(G) are entitled to a 50% exemption (plus possible an additional amount that can amount to approximately 10% or so). Donations under 35AC are entitled to a 100% exemption.

From speaking with those working in other countries, we are seeing that this is a problem in developing countries, where full exemptions do not exist. That aside, it is something we will have to consider when seeking funds in India. The good news is that corpus funds often fall into Section 35AC, so it might actually help us to get unrestricted funds.

Performance Metrics for the Development Sector

2008-01-28T17:34:00.000+05:30

No quest in the development sector remains as elusive as the search for meaningful performance metrics. And with increasing demand for corporate social responsibility – commonly referred to as “CSR” – business are increasingly seeking performance metrics to validate their social investments. But in this endeavor, for-profit organizations are failing.

The main reason for this failure is the misconception that development sector performance is similar to corporate sector performance. The fallacy is that by tracking efficiency and output, a fair measurement of performance immerges. But, as businesses minds know, performance cannot be measured without a definite understanding of what is to be achieved, or the objective.

All businesses share one objective: increase profit. Businesses adapt different strategies to increase margin and/or volume, but ultimately all performance will be measured against this objective.

The core objective of development work, on the other hand, is to change the environment, so that such work becomes no longer necessary. Essentially, performance is a measurement of how well you are affecting the system in which you operate to make your effort redundant. For example, an organization seeking to improve the status of women in rural India will be successful once rural women’s status has been corrected. In development work, you are not trying to increase demand for your work, but rather decrease the need.

And now we can see why businesses’ CSR departments have difficulty producing performance metrics. The objective of development work is essentially the inverse of the for-profit objective. When development sector performance data is demanded, the business sector defaults to measuring output and efficiency. But output and efficiency help measure development sector performance only if they are measured against the ultimate objective. Increase output and efficiency is not necessarily an indication of success.

For the development work, therefore, we encourage organizations to first define, in terms particular to that organization, what success would look like. That vision of success becomes the core objective. By further defining what is necessary for that objective to be realized, organizations develop a better understanding of what good performance entails, and what data will indicate success. Only by defining and applying objectives can we meaningfully measure development work performance.

Ways to Connect NRI Volunteers to NGOs

2008-01-27T10:22:00.000+05:30

One issue we have see with NGO management almost everywhere in the world is that it is very difficult to manage volunteers. While many are very talented and have great experience it is often not it the non-profit world. Even if it is there are concerns over motivation, keeping the happy, what one can assign to volunteers and be sure that they will get quality work back in time, etc.

For Indian issues this is especially important because they are staffed very leanly and if they are given volunteers that can and will be motivated to work and handle responsibility, then it can be a great boon. Give, for example, has found an excellent way of not only bringing in foreign volunteers and interns but has taken advantage of many other Indian volunteers, especially women with great work experience that are either at home or taking leave from work. (I would recommend contacting Give regarding their experiences if you are interested in how to implement a similar program).

And now that we are back in London and have had a chance to meet with some Non-resident India (“NRI”) community groups, it is clear that there is an opportunity to connect those interested in helping Indian NGOs to Indian NGOs. Many of these groups have people who have great experience working with volunteer groups to do a range of things – put together cultural shows, language schools, community meetings, and efforts to lobby local government. They would be able to help in volunteer coordination and bring those much needed skills to an NGO and would probably be able to do so in relatively short stints of volunteering where they could “teach” people at the NGO what they could do to help get the best out of their volunteers.

Final Say Regarding the Content of the Report

2008-01-26T01:43:00.000+05:30

As we get ready to meet with donors one new wrinkle we are finding is ownership over the reports we will present. Of course, we want the NGOs to be happy with what the document says, but we have to be critical. The reports must be seen as “ours” and as done with a critical eye. While we shy away from outright recommendations, it is clear from donor discussions that they look favorably on our recommendations because they trust the quality of our diligence and base that largely on our previous experience and work relationships. Therefore, we have to convince the NGOs that even if we say things they disagree with they have to accept it because it will encourage more open and honest communication, as well as encourage long-term donations. In future meetings, we will have to emphasize this point.

Perverse Incentives: Why the Correct Criteria Matter

2008-01-24T16:42:00.000+05:30

Another criteria related issue we are discussing with our partners is how certain categories that people like to report often have a great risk of becoming harmful if they become the standard measurement tool.

For example, we are debating – and trying to convince a group that has sought our help and insight – that reporting on things like “students educated” and “children fed” should not become the thing they view as their main measures or what they should try to get donors to examine most closely. In our view both of these categories result in “teaching to the test” behavior. The more one focuses on “students educated” or “children fed” the more one tries to raise these scores because that is how the group measures success and how the donor does, as well. The problem is that NGOs should not operate like businesses and maximize certain scores. After all, the NGOs’ really aims are to reduce these scores, and unlike businesses, encourage their own extinction. The fact that more students are being fed or educated does not really mean an NGO is being more effective or successful. Of course, it does not indicate they are not, but what we are trying to convince this group – and others like it – is that reporting needs to focus on other types to measures, as well.

This where we think outcome measurement is especially important. It encourages a more holistic approach to reporting and learning and sees many criteria in concert so that when one evaluates any one criterion, one sees it in terms of the ultimate outcome that is being sought.

Additional Thoughts on Beneficiary Surveys

2008-01-23T16:38:00.000+05:30

We are working with several other groups to discuss the possibility of creating shared platforms for the exchange of information on NGOs throughout the world. One issue that has come is what measurement criteria should be used. There is a tendency to quantify everything. This is understandable because it allows for easier comparison, gives the donor a sense of understanding regarding the information he or she is viewing, and is quicker and easier to examine. We have discussed before how we are opposed to exclusive use of these criteria. For one, it often doesn’t provide anything useful. What does a score of 8 on responsiveness mean. What does 4 stars mean? Yes, these are useful and where possible quantitative data should be used but it must be in combination with more subjective measures or a hybrid to be full effective.

One thing we have mentioned is how we would like to incorporate beneficiary surveys into our reports to show how well NGO listen to their beneficiaries. We would like to use a common questionnaire to examine the groups and then use them to compare each other and their own progress. We will try to use number scores, but they will be hollow without some anecdotal support or at least some explanation of the score. Additionally, allowing for explanation means that the NGO is forced to reflect on the results and account for them – something we think is very important.

In Praise of Agenda

2008-01-22T09:17:00.000+05:30

I have been asked by several people to provide a good source of background information as to children’s issues in India and social problem s generally. I can provide a list but if you were going to refer to just one, it would be Agenda. They do great work, are reliable, and confer with leaders in the NGO world to make sure that they are highlighting issues and ways to solve them. Their magazines have great bibliographies and cites for further reading, as well.

http://www.infochangeindia.org

NGOs Complain About Donor Practices

2008-01-21T17:21:00.000+05:30

After meeting with NGOs throughout India, we have heard numerous complaints from NGOs about donor practices. These complaints often relate to practices that impair an NGO’s ability to effect social change. Many of these problems in the donor/NGO relationship, we believe, will be alleviated by the reporting practices CMI endorses.

Over-Steering

One practice often complained of is what we like to call "over-steering" or "back-seat driving" of an NGO. This occurs when donors use their money to demand NGO take on certain new activities or different operations. NGOs explained that donors contacting them are often willing to commit significant funds, but only if the NGO takes on a project or cause that the NGO did not previously engage in. We have one example that borders on the absurd: an education-focused NGO was offered large funds provided that it do HIV/AIDS work as well. When large enough funds are offered, many NGOs will except on the condition of doing new types of work.

Projectization

Donors often demand that a NGO tie donations to one of the specific projects, or one of the many activities that the NGO does. NGOs are thereby forced to distribute funds unevenly throughout the NGO’s operation. This does not give NGOs the resources they need to effect complex social change. In extreme cases, NGOs are forced to borrow from one project to keep the NGO afloat. NGOs tell us that only the rare, well-informed donor understands that developmental organizations cannot continue efficiently if they are separated financially into tiny parts, some well financed, while others go bankrupt.

One-Off or Limited Duration Funding

NGOs also complain that they need to constantly seek new donors because too many of their supports make only one-time or limited duration donations. NGOs believe that donors want to constantly find new causes to support. That is not in itself bad, but it is not conducive to effective development work, which requires a steady stream of funds from life-long donors, year in year out.

How Effective Are the Credibility Alliance/Give Guidelines?

2008-01-20T07:35:00.000+05:30

One thing we have been asked to trace is the effectiveness of the Credibility Alliance and Give Guidelines for NGO listing. We will be evaluating our experiences on this and you can expect a long entry or link to a report on our opinions as to what guidelines help groups perform better, which ones help donors gain confidence, which help to insure that only “good” NGOs are listed/recommended, and which are overly burdensome or not useful (possibly even harmful).

NGOs' Opinions of the Methodology

2008-01-18T11:21:00.000+05:30

The Keystone methodology requires lots of resources and effort from NGOs. The problem in India is that NGOs operate on a thin line. They have small budgets, and limited staff and as we are seeing can hardly do what we are asking of them if we did not do lots of the work and hand holding.

And the closer I get to these NGOs the more I realize that they fall into two groups: (1) NGOs that see this as a fundraising effort; and (2) NGOs that see this as a fundraising effort that will also help them to think strategically about where to go. This is fair because frankly without the carrot of funding, they would be expending way too much energy and money to justify their use of resources.

I’ve said this before, but am still worried that the NGOs are not seeing the value of the methodology. I still think it is highly valuable and the problem is with us not being able to explain it well enough. While the groups assure us that they do get the value, I am not sure if this is honest. It could be that they will appreciate it only after they do their feedback reports and see how they are becoming more efficient and that it also has the added benefit of funding. But what happens if the funding falls short?

Will NGOs Benefit from the Information Created?

2008-01-16T16:32:00.000+05:30

CMI suffers from certain limitations in our abilities to do everything that we want. We are two people, and though we get support from our wonderful partners, we are the ones that have to travel India, meet with groups, lead discussions, draft and edit reports, meet with donors, be our own PR firm, and handle much of the cost. As a result, we just can’t get everything we want done.

I mention this because if we had greater resources we might have a different view, but at the moment I am of the view that the methodology is better for academic purposes than NGOs (at least in India).

The results of the methodology – or at least one result – are validated impact reports. This will show the NGOs and donors and others how the NGOs are achieving the aims they seek. The problem is that lot of the NGOs are trying to do some form of this but don’t have the time to track it and devote resources throughout the year.

My fear is that they will go through all of this and produce this information but won’t or can’t (because of resources) devote energy to appreciating the value of the data. And in the end, this data will all be useful for academic interests – papers on whether impact reporting is something NGOs are interested in and whether mapping outcomes helps NGOs focus.

Donor Input on the Style of the Reports

2008-01-14T19:12:00.000+05:30

We spoke with a couple of donors and they seemed to support what the NGOs said. The maps are not helpful without a connection to current activities or something indicating percent of time devoted to each activity. Because putting percent of time could be disingenuous we are working on ways to put current activities into the maps. Our current way is by putting in arrows to each prerequisite the activities target. That should helps how what is being done, what is being planned for in the future, and what isn’t being done or even considered. This should help donors and NGOs.

Reports Need to Connect Activities to Outcomes

2008-01-12T16:30:00.000+05:30

We have been working with the maps we created to reflect the current activities a bit better. Initially, we were drafting theory of change maps that mapped outcomes and paths to get there but shied away from reflecting what the NGOs currently are doing. One fear was that they would then see that and try to reformulate their maps, either immediately or in future versions, based on that information and lose track of the outcomes they wanted to bring about. But without some time to current activities it seems hard for NGOs to see how to bring about the outcomes or refocus on things they will have to do. They also tell us that donors will want to see that information or at least percent of time devoted to current activities.

We plan to check with some donors to see what they think.

Indian Donor Preferences

2008-01-09T16:28:00.000+05:30

I have met with a couple of corporate representatives from banks in India and they suggested that we might have a problem in India. We have noted that the middle class here seems to resent efforts to help the lower middle class or poor that do not also in some way help them. I am sure this is not unique to India. What is troubling though is the banks seems to fear what the public might think of what they do and say they will shy away from certain activities. They are much more like to sponsor activities that support supplemental schooling through sports activities, dramas, food, etc. that would help a group but not be seen as providing resources that their customers would also want. I am not sure if this is a widespread belief but the people I discussed this with did represent major banks and do donate large sums (especially under Indian standards). I also fear that if this is the case, then getting funding domestically for sustainable development might also be tricky.

Convincing Donors to Use the Framework

2008-01-07T16:27:00.000+05:30

This is more of a note to remind us that we need to tie the donors into this project, as well. We are definitely focused on how to get NGOs to use the maps that they are creating and to seek feedback and input, but haven’t made a lot of plans for how to get the donor’s to use these maps. One way might be in the MOU to say that donors will also provide a response to the NGOs feedback reports. The problem is I am worried that donors will just not do this or sign anything. It may have to be based on trust. If we show them good groups and these groups provide good feedback then they will expect that from then on from other groups. In that case, we need to be educating donors as to why this information is the right information.

Any background information that anyone has on this topic would be greatly appreciated. (I know there is a lot, but what I am hoping for is to create a list for donors with a short summary so that they can do some reading if they are interested.)

Is the trust in us or is it in the system we are creating?

2008-01-04T16:25:00.000+05:30

We have now been approached by other donors and people within Give and it seems that it is actually the CMI that people trust and the diligence that we provide. This is understandable. We expected that both NGOs and donors would initially use this framework because they trusted us or Give and our personal connections. We must remember to move from this by educating both why they need to seek certain types of information and report certain things. So long as we push this, I think both will come to appreciate the new and open communication they will share and increased effectiveness of the group and the donor’s money.

Domestic Support for CMI's Reports

2008-01-02T16:22:00.000+05:30

As many know, Give supports the Mumbai Marathon and helps connect runners to charities to raise a great deal of money. One of the runners looking to donate substantial funding has come to us for advice and we instructed him on the Keystone framework. He passed this on to another runner and now we have our first two sizeable donations.

What is important is what we learned about the reports. We tried a modified memo and then the report we will provide for each group. As we suspected, our report is much more valuable and donors seem to appreciate the diligence and advice it reflects. They see the benefit of the Keystone methodology, but only after we explain it to them and show them why it is meaningful and more useful then other things available.

We will track donor engagement and use of these metrics to see if they truly appreciate the method or rather are more interested in the diligence we provide.

Need for Central Forums

2007-12-30T16:16:00.000+05:30

Some of the groups we have met with have noted the desire to create central forums so that they can discuss what they are doing and learning with similar groups throughout India Some areas have this – certain types of education, child labor (essentially the hot topics). But many specialized groups could benefit from this. This would allow for not only a sharing of ideas, but also create ways to exchange people between organizations, foster community outreaches, and many other things. Importantly, it would also serve as a way to centralize facts and statistics, which vary greatly in almost every field in which the NGOS we have visited work. This would allow for better planning and donor confidence and just about everything else that goes with reliable information. Of course, the government should be doing a lot of this, but as with many third sector obligations, it doesn’t happen in India.

Step by Step Growth

2007-12-28T16:12:00.000+05:30

We are working with an HNI who is contemplating a large donation to help an organization that works on rural education to expand nationally. I’d like to point out this group’s model because it is relatively simple but allows them to maximize their resources. They start by implementing proposed projects in schools and centers near them. That way they can be directly involved to the extent necessary, travel to the sites, and gain the school’s (teachers, students, and children) confidence. After monitoring the success of those programs for 3 to 5 years, they will scale them up to take them to other areas of the state. They partner up with various groups to teach them how to do these types of activities. They are now contemplating expanding certain programs nationally and this where the donor’s money and connections will help.

I like this model because it allows for careful reflection, study, and constant input at a manageable level for 3 to 5 years and then slowly grows. Each step allows for discussion with the relevant stakeholders, requires reevaluation of goals and aims and strategic planning.

Statistics Given by NGOs

2007-12-26T09:11:00.000+05:30

As I am filling out some reports for various NGOs it becomes increasingly clear that NGOs – at least the ones we are working with and have met – do not have accurate records of the numbers of people they have helped or with whom they are working. The numbers they give will vary each time they are asked to provide the information and will vary significantly based on how the questions/requests are framed. This is problematic not only for putting reports together, but also raises questions about how responsive these NGOs are to their beneficiaries when they are not sure how many of them there are. Of course, I am slightly overstating the concern, but it is something NGOs need to track better so that they can make more accurate self-evaluations.

Difficulty with Mumbai

2007-12-25T16:05:00.000+05:30

This entry adds little to NGO learning, but for future people coming to Mumbai the major things we would like to pass on are: (1) everything takes longer than you think and is slower than you planned for; (2) commuting is exhausting and will take half your day so live close to work; (3) you need to stay on people’s back to get responses. That being said, it is the easiest city in India to run this type of venture in because of the technological assistance, abundance of support, and dynamic and open NGOs.

Defining "NGO"

2007-12-24T16:04:00.000+05:30

The term "NGO", or "non-government organization", is a misleading term -- it's meaning depends entirely on who you ask. The literal meaning (i.e., not part of a government) offers little guidance and may even suggest that NGOs are prohibited from working with government. But NGOs are often most effective when they coordinate their efforts with governments.

Because of this ambiguity, The Charitable Measurement Initiative has developed it's own definition of NGO, which is carefully tailored to our work, but we believe it can be applied on a broader scale:

“NGO means any organization, entirely or largely independent of government, formed to provide services or to advocate a public policy, with primarily humanitarian or cooperative rather than commercial objectives, and does not include organizations whose resources support political parties or religious groups."

Organizations that advocate a particular religious view should not be considered "NGOs". To illustrate this point, consider an organization operating a free school for disadvantaged children in a predominantly Hindu region. If that school actively promotes the Christian faith (or other faith) to its students, it should not be considered an NGO. To maintain their humanitarian component, NGOs must listen to their beneficiaries. If there were no "strings attached" to the education in the above example, the young students (the beneficiaries) would not ask to be converted.

Corruption and Computers

2007-12-23T20:54:00.000+05:30

We came across a person who was trying to donate money to an organization to buy computers. When he offered to buy the computers because he could get a better rate, the NGO declined the donation. It turns out that two years later the NGO was under investigation for siphoning funds.

We are trying to find a way of working questions like in-kind donations and NGOs openness to them in our diligence trips to unearth such type of behavior.

Project Specific Reports

2007-12-22T13:03:00.000+05:30

Three of the NGOs we are working have mentioned to us that they are contemplating leaving the Credibility Alliance over issues with giving project specific reports. Their major complaint is that the reports, especially to the Credibility Alliance or Give, require a lot of time and are virtually useless. They are forced to account for how every cent of a donation is used, but it is difficult to track because funds are often combined in a project, which makes saying exactly what each cent was used for difficult. As a result, NGOs are often forced to make reports that stretch the truth.

NGO-Donor Tension

2007-12-21T16:00:00.000+05:30

We have heard from several of our groups that they dislike the project oriented demands that donors are putting on them. Donors will sponsor a given project or sub-project and then demand a certain type of report on effectiveness, use of money, and future plans. And it seems that almost each donor (or at least the HNI, corporate, or granting agency donors) requires a different report. Not only does this make completing any individual report difficult and tax the NGOs resources, but it seems to create resentment in the NGO. This in turn effects the relationship with the donor and strains continuing support.

A little self-referencial but....

2007-12-20T10:55:00.000+05:30

Here is a link to Alliance magazine, which we want to encourage people to read. The article by David Bonbright is especially worth your time (and not just because David calls attention to the blog).

http://www.alliancemagazine.org/free/

http://www.alliancemagazine.org/free/html/dec07e.html

http://www.keystoneaccountability.org/node/149

NGO Comments

2007-12-18T05:33:00.000+05:30

Here are three comments we have heard from some of the NGOs:

1) What if our theory of change is too broad and when donors see it they start questioning us as to why we are not tackling more issues, especially when we don’t have the resources to tackle all these issues?

2) Sometimes you lead the discussion too much and need to let groups share their ideas.

3) There are people who would like to communicate but cannot because of language barriers or confidence in using English.

Recommendations from NGOs

2007-12-17T13:32:00.000+05:30

Here are two suggestions we received from two of the NGOs we are working with:

In the maps, identify the percentage of the NGOs work that is devoted to the necessary outcomes.

The map needs to by more dynamic to capture all the activities that the NGO is doing or there is a fear that the donor will not understand the environment in which the NGO is acting and why it makes certain strategic decisions.

The Methodology Does Not Work with Mid-Level Staff and Large Groups

2007-12-16T13:14:00.000+05:30

We have tried several permutations of the presentation now, and most recently tried to meet with a large group (approximately 10 people), most of whom were middle-level coordinators. What we found is that it was extremely difficult to move beyond even the vision statement because people disagreed so much. This disagreement often lead to arguments about relatively innocuous word choices and ultimately a muddled theory of change. The presentation seems to work best with a smaller group of key/core coordinators and advisors. We should leave it to them to share ideas with a larger group and then collect that information and give it to us. But when we meet with the group, it is best to have smaller numbers (about 2-5).

Of course some of the problems we are seeing come from groups that have no idea what they want to achieve or have over extended themselves. The framework really does expose these flaws and, if the group takes the exercises seriously, seems to refocus their efforts.

Mapping Vision Sometimes Requires Current Activities

2007-12-15T06:16:00.000+05:30

The vision statements in the maps of the theory of change are supposed to be focused entirely on what future world you would like to create. It is not supposed to have aspects of what you are “doing now.” This, however, seems a little tortured for groups that do focus on creating change by delivering a service. Not only that, it seems like it could hurt them by encouraging them to grow in areas where they probably should not.

I am working on a school that seeks to give children from slums an excellent education and then through family and community outreach programs, help transform the slum communities. The school is essential to that. They start with the school and work from there. So, if one was to phrase their vision like, “Group X seeks to provide exceptional education to impoverished, abandoned, and orphaned children so that they can break the cycle of poverty for themselves, their families, and communities,” it would seem as though they may someday move beyond using the school to do so. The school is not just a strategy or how they will make this happen, it is essential to their identity. In such cases, I think the vision needs to have some element of what the group is “doing now”.

Vision Statements Are Too Broad

2007-12-14T14:22:00.000+05:30

One issue we’ve noticed a couple times is that some NGOs are drafting visions that are too broad. As a result, they list many outcomes that they are not actively pursuing and that they can’t pursue because they don’t have the resources.

This could be dangerous for several reasons. First, NGOs could try to spread themselves thin and move into areas they don’t have the capacity, resources, or abilities to tackle. Second, donors looking at such a map might question why the NGO is not tackling these other issues.

For that reason it is crucial that we have a narrower vision of success and rope in groups by focusing them on what is practical. We are still not perfect on this step but are getting better. We also need to help the groups see that they are not responsible for tackling every necessary outcome on their own, and that they can partner with others or work with others that are focused on those issues.

Interesting Article

2007-12-13T14:48:00.001+05:30

http://www.guardian.co.uk/society/2007/dec/10/internationalaidanddevelopment.google

We draw particular attention to the comments of the UN's human development report editor, who mentioned the failure in India, a notably high growth country, "to deliver on human progress because of inequality." The key to achieving the development goals, he said, "is to concentrate on helping the very poor."

Bangalore is a good example of this problem. CMI has worked with many Bangalore-based NGOs, each of which complain that economic growth has actually hurt the city's poor. Many are unable to access any of the growing opportunities, but they are burdened with an ever increasing cost of living.

You Have to Visit the NGOs

2007-12-12T02:47:00.000+05:30

This is a very obvious statement, I know, but we have heard of donor advisor groups coming to

India

and not actually visiting the NGO where they are actually doing their work. In our experience, seeing what the NGO does and interacting with their beneficiaries and staff has been invaluable in understanding exactly what the NGO does. Many NGOs have difficulty communicating their dynamism, and it takes a visit to see it and often the indirect benefits of their efforts. Others are very good at misleading people as to what they are doing or in other cases have been dishonest about what is being funded (e.g., saying two schools exist when in reality the two are just meters apart and cater to different age groups). I can’t imagine how these groups are doing their research or how they could possible understand the complexities of issues in India that require seeing and being there (like many of the rural development topics).

Government Will Not Sponsor Awareness

2007-12-11T14:46:00.000+05:30

Just as with donors are reluctant to fund administrative costs, we are hearing complaints about government’s not supporting awareness campaigns. They seem to place the entire cost on the NGO that has taken up the advocacy role. Given that the government has many more resources and is often supportive of these measures, one would hope that it would help a little more with the funding. Because it is not, groups either have to stop or curtail their efforts or else be put in a position where they have to explain to donors why resources for awareness are necessary. Because it is hard to see the immediate results of these activities, donors tend to be reluctant to contribute to awareness. The problem is that without awareness and advocacy, meaningful development is extremely difficult, if not impossible.

For those interested in the need for increasing advocacy and awareness practices, I would recommend the Children’s Rights & You (“CRY”) website. CRY is also an organization that I can’t say enough good things about, so are worth a look.

Feedback from Keystone

2007-12-10T14:42:00.000+05:30

Here is some excellent feedback from one of our partners at Keystone:

"Starting with your first workshop observations.

The donor hook… Yes, we made that same mistake when we first started Keystone: thinking that you could tinker with one part of the ‘system’ and that would be enough. Actaully, this vindicates Keystone’s assertion that you can seldom bring about lasting change unless you can influence other actors in the system. If you only address one part you can be undermined by other parts unless you work to align the system. In our case the current system of grantmaking (mainly donor practice and demands) actively discourages this kind of long term planning and reporting with constituents for impact. So getting NGOs to do it on their own is too difficult. That’s why we have brought both funders and NGOs together in this project – who both want to find ways of planning, learning and reporting differently and are prepared to make the investments (cash for one and time for the other) to do it properly.

Then on to your other big point – that we should try to make the system more linear. I’m not sure. But I agree we need to break it up into more easily digested parts that can be addressed one at a time and woven into each other down the line. I’ve been thinking deeply about this and have decided that there are really only 3 clear steps in the complete method:

1. Creating an outcome-based framework for planning and learning for impact (The theory of change: imagining success, mapping the ecosystem and mapping the pathways to and indicators of success)

2. Learning with stakeholders / constituents (Getting stakeholder synergy around the theory of change and then the practical stuff on gathering and documenting feedback and evidence of success, and analysing and responding to it)

3. Public reports and validation (What a public report that focuses on learning and progress towards impact should look like, and the various means of validating it)

This also addresses your question in your second workshop observations about whether the eco-mapping disrupts the train of thought moving from the epitaph activity grappling with the ‘kernel’ of what success looks like (I’m struggling with what to call this) and the mapping of pathways (preconditions) to the outcome.

You’re right – I think we need to deal with one part at a time and ensure that we don’t cause confusion by cluttering up their understanding with too many bits of new stuff. But we need to cover all the bases within each part.
What I mean here is that we should concentrate first on Part 1. developing the theory of change and learning framework. But to do this we need to break old thinking habits in two main ways:

1. They need to think about their work in terms of the OUTCOMES they want to achieve. The epitaph activity is a shock tactic to get them to do this – just to express as clearly as they can the changed and sustainable ‘future’ for their primary constituents / beneficiaries.

2. They need to understand that they can achieve this future best by not only working directly themselves, but also by understanding and influencing the other system actors who can influence this outcome. The new “winners” in social investment will be ‘learners and sharers’ - organisations who work directly AND indirectly by influencing the ecosystems around shared outcomes.

So I think they need to be together. Perhaps we need to integrate them better in the next activity which is to create a more detailed picture of what success would look like from a system perspective. The imagined future in which beneficiaries are acting within a different ecosystem that supports and promotes their well-being.

Then we pause so that they clearly integrate the vision. All in the future that we are striving for. And only then move on to mapping the pathways – the preconditions for success. I guess, when you’re trying to cover a lot of ground in a workshop we attempt to cover too much – which is what causes the confusion. These are simple when you get it – but the process of breaking down old habits and patterns takes time.

Part 2: Only when we are happy that the organisations are happy with Part 1 and have a reasonably comprehensive ToC and learning framework in place. should we go into any detail with Part 2. (tho they need an overview of the whole in the introduction).

It is only now that we should begin relating what organisations actually do to the theory. Your point 6 addresses a key issue: the difference between your theory and your strategy. This has also caused confusion and should be addressed slowly and carefully.

The point here is that a single organisation might not be able to address ALL the preconditions and pathways it has identified as essential to success. This is OK. As long as it sees what it does as part of a bigger process of change that involves others contributing in other ways. As long as between them, the different actors in the ecosystem are addressing all the essential preconditions and are acting more in alignment, the likelihood of sustainable solutions is much better than if they all only did fragments in an uncoordinated way.

Many organisations will feel that they can only contribute part of the complete solution. This is how social change works in most contexts – the point is to become conscious of the system and our role in it – as well as how we can influence it to work better. E.g. improving performance of rural kids at school might involve different organisations addressing curriculum, learning materials, remedial English and maths, better school governance and management etc. all essential to success, but best done by different actors in alignment – because unless all are addressed, the individual projects risk failure.

In this sense, the framework also works well for relief organisations who might want to get communities through an acute crisis but then also help set in place the elements of longer term rehabilitation and development. Their outcomes might be shorter term, but are still outcomes or steps to longer term outcomes of secure, sustainable and productive communities in the long run.

Finally, If we make it a separate practical part, that we introduce separately and implement over time, we can hopefully avoid the confusion between stakeholder mapping and ecosystem mapping – even though the eco-actors are also part of the stakeholder map.

Your other points are very valid: the need for comprehensive financial reporting and not just individual “project reports” as most donors ask for (they often just want to see the financial accounts for the bits that they funded and not the whole programme.). And lastly, it is the validation bit that we hope will help persuade donors that they can take the risk – and trust organisations and their reporting enough to make grants more flexible and longer term commitments. But we will need to test this in practice."

Sometimes Credibility Alliance/GiveIndia Norms Are Too Broad

2007-12-09T14:41:00.000+05:30

While I agree with the vast majority of Credibility Alliance/GiveIndia norms, there are a few that seem to be overbroad in the Indian context. The two that I think are most problematic are the requirements that there be no political party representatives on the board and there be no religious component to the NGOs work. I understand why they are necessary and why given the need for assurance that NGOs aren’t misusing funds the bright-line rules are necessary, but given that they can easily be subverted (e.g., making the political representative an advisor instead of a board member), I think there needs to be a materiality clause. Just with religion, it is almost impossible to avoid some religious activity in India and often it would be more bizarre to actively avoid religious activities. A materiality clause for these norms would, at the very least, be more intellectually honest.

NGOs Viewed As Government Extensions

2007-12-08T14:40:00.000+05:30

NGOs in India often seem to sprout up to plug holes in government services. This is in part because of the large need and also in part because of the fact that there really isn’t an extensive social welfare network – especially in rural areas.

One of the things we’ve noticed with certain areas in which the government is not doing anything is that they tend to let the NGO be a social laboratory. For example, Samveda, a group in Davnagere, Karnataka, is the only organization in India that is systematically working to help those children with learning disabilities. (It also has expanded to cover a gap in assistance with for those with other disabilities). The government has no formal or informal program to assist these children, nor are the schools in India equipped or trained to identify or support those with learning disabilities. Unlike the West, there really is a complete lack of understanding about this topic, and as a result many highly intelligent students are mislabeled as troublemakers or unmotivated students. For almost 10 years, Samveda had little assistance from the government. Samveda had to set up a school for these children, had to seek and fund research into these areas, and even went around schools to help them build their and their teachers capacities to address learning disabilities. Essentially, they had to take up he government’s role. Samveda’s efforts, along with its advocacy, has finally gotten the government to notice and put some minimal effort toward this issue. But what is clear is that the government is happy to allow Samveda to continue its work with the expectation that it will slowly incorporate Samveda’s findings and work when slowly over time – though when and exactly how are left ambiguous.

A second thing we have noticed with government with respect to its attitude towards NGOs is that they see the NGO as their support staff. This is especially true in rural areas. One great example seems to be lake de-silting efforts. Lakes and water sources need to be de-silted after the monsoon, but this requires the government having the resources to go to villages and do so. Because they cannot, they often ask NGOs to do so. Although the NGOs they ask are usually recommended by someone or known by someone to be a well-run organization, the government doesn’t seem to discriminate by what work the NGO does. So, let’s say a group runs a series of schools or helps them organize women’s community groups…they still would be asked if they would like to de-silt a lake. Some NGOs say no, while others will just hire some people to do it and take the money or will find a way to justify the work within the scope of their efforts. It tends to be a decent measure of how much focus an NGO has, but given funding problems in rural areas it has hard to fault the groups that do take on these projects.

Mapping the Theory of Change Isn't Easy

2007-12-07T14:38:00.000+05:30

We have started to work through some of the maps the groups are creating have noticed that unless we walk the group through a couple stages, they rarely are able to come up with a complete map. What seems to be necessary is a bank or sample of maps so that they can model theirs after those sample.

Donors and Admin Costs

2007-12-06T14:37:00.000+05:30

One of the most common complaints we have heard from NGOs is that donors will not fund administrative costs. This is obviously a crucial component of success but it is difficult to convince donors to fund the organization’s salaries or rent instead of funding a certain number of children. We will have to make efforts at explaining the entire developmental process and hope that donors get why funding such expenses are necessary.

Loan Sharks in the Villages

2007-12-05T14:37:00.000+05:30

One of the biggest challenges in helping rural populations to generate steady income is getting rid of predatory lending. People often have to borrow at extreme rates (10% compounded monthly) because they don’t have other options. In addition to the high rates, these lenders also require other conditions, like making a lendee’s wife work as a maid at the lender’s home, agreeing to give a share of the profits from the sale of crops to the lender (in addition to the interest), and requiring people to cultivate the lender’s crops first. While it is paramount to stop these lending practices, the community needs to deal with the lender so when a group is first tackling these issues, it needs to find a away to engage the predatory lender and slowly remove his power. When groups try to immediately create “banks” or other options for the village, the predatory lender often retaliates against the others in the community.

Self-help with Men vs. Women

2007-12-04T14:36:00.000+05:30

Some of the self-help groups we met (they do the same thing as “income generation” programs) target women instead of men. Not only does this help to change certain societal behaviors, but it also seems to be more effective in helping the family and children. Women tend to save money that they have and spend extra on the family and children, where men tend to spend the extra income they generate. Of course, this is a generalization, but it is something worth noting when examining rural NGOs.

Income Generations

2007-12-03T14:36:00.000+05:30

Several of the projects we have seen that have been labeled “income generation” are aimed at helping people run small goods stands, sell homemade foods, or bags, etc. It helps people make enough money to survive, but it seems that it barely does so. It also does not seem to allow for the children to necessarily avail themselves of educational opportunities or be guaranteed that they won’t have to work. I’m not sure what the alternative is in areas where there aren’t other opportunities, but I’m also not sure this type of intervention leads to meaningful development.

Villages and Rural Development

2007-12-02T14:35:00.000+05:30

We visited an NGO in rural Mysore that focuses on womens’ empowerment. Depending on the source, anywhere between 66 to 77 percent of the population is rural. Given that, it is essential that development efforts focus on that area. Many efforts work on public works projects – running water, toilets, etc. – but few seem to focus on education and general employment issues.

The group we visited – which really seems to be two groups that now work together (Bharath Charitable Cancer Hospital Institute and International Human Development and Uplifitment Academy) – does several things, one of which is empowering women by giving them loans (microfinance loans) to run small businesses or farming ventures. They also help the women in a village form group forums to meet and discuss issues. Though these activities women learn to come together and socialize (which they weren’t doing), gain confidence, learn to manage finance, and gain status in the family because they become the primary wage earners. Corollary benefits of these activities are: the kids tend to attend school much more frequently, abuse problems are reduced, men tend to abuse alcohol less in these villages, and general health increases. This is primarily because women in villages tend to save a greater percentage of their income, spend more on children, and increase spending on health/hygiene for the family.

All of this is important because it seems that in order to improve rural children’s lives, NGOs need to empower their mothers. Proof of this comes from the fact that the IHDUA school in rural Mysore is not only one of the leading rural schools in the area, but is one of the best schools in the state.

Press Coverage of Indian Charity

2007-12-01T14:34:00.000+05:30

I’ve seen a great deal of the foreign coverage focus on the negative aspects of giving here: a resentful middle class, HNIs not donating enough, growing dissatisfaction, and distrust of NGOs. While I have not seen many NGOs that aren’t operating honestly and doing a good job, that may be because we have limited ourselves by doing research, seeking advice as to best practices, and working with GiveIndia listed organizations. It is the Give oversight that most explains why we have yet to see bad ones.

But for all the coverage of the lack of domestic charity, what is missed is how innovate and deep some of the NGOs efforts are. In child labor, for example, India has some of the most innovative and progressive laws anywhere. The NGOs were instrumental in pushing for changes and advocating new legislation. The have done a lot to curb popular opinion against child labor – which is very difficult in this country. All of this is lost. And little of the innovativeness is shared with foreign outlets. It is a shame that what we see on a daily basis is not shared more widely.

Here, in India, you will see people who could be making – with no exaggeration – 10 to 12 times the salary, working 18 hour days to make sure that they consider every possibility to solve these enormous problems. And after seeing many examples through out North and Eastern Africa, the US, and the UK, I can confidently say that the best experiments in civil society solutions are in India. So, while there are problems with the “giving” culture at large here, there are many, many things that are fantastic. I just hope some of the media coverage brings that to light and shares that with everyone, instead of parading out the same article on the ridiculousness of Mumbai’s industrial elite (which, for the record, are not all Ambani’s – there are some unbelievably committed people too.)

Recommendations from NGOs

2007-11-30T13:32:00.000+05:30

The Charity Commission Steal Money!

2007-11-29T14:32:00.000+05:30

The Charity Commission in Mumbai takes a 2% fee on all donations to Mumbai groups. The fee is supposed to cover the cost of the Commission, but seeing as it isn’t staffed with qualified people, there isn’t a computer in their offices, and it generally does nothing, I think this is my new least favorite thing about Mumbai’s government. They have many millions (if not billons) of rupees collected that are just sitting there. They should, at the least, return some of this money.

Thankfully, the NGOs have gotten together and made serious efforts to get rid of this fee, and it should be gone soon. A good site for more information on this issue (and NGOs generally) is karmayog.com.

When Groups View the CMI as a Fundraising Effort

2007-11-28T14:31:00.000+05:30

Usually when we meet with groups there is a mix of operational/strategic personnel and fundraising staff. On occasion, however, we have met with groups that are largely composed of fundraisers. And when half or more of the people we first meet are from the NGO’s fundraising staff it usually turns out that they never fully grasp that the Initiative is not a fundraising effort and rather is something to help them to refine their thinking, refine their efforts towards outcomes and aims, and that the fundraising aspect is a side part, largely to encourage donor engagement. It will be interesting to see if these organizations are engaged enough to make our efforts valuable to them and whether they will put in the significant effort that is necessary.

With those groups that seem dynamic and that we are most excited to work with, the fundraising aspect is at best a side part that they hope will occur but are willing to engage in the process to build capacity.

The NGOs Have to Do the work

2007-11-26T15:56:00.000+05:30

We had a follow up meeting in which the NGO did not do much of the internal work we had asked them to do. The result, as we have seen before, is that they essentially asks us to re-run the workshop. While this is helpful and we definitely make progress, it usually results in us feeding the group ideas more than them thinking what they actually believe and are trying to achieve. It also seems to end up with the group taking some of our statements out of context and viewing them as suggestions as to ways they should expand what they are doing. These types of groups tend to see us as advisors or strategic planners – something we try to warn against – whereas the more dedicated groups don’t see us as such.

Annual Reports Are Useless

2007-11-25T14:28:00.000+05:30

Most of the annual reports of the organizations we have looked at offer very little material that is not available on the website. The information on the website is usually easier to access is more current. The annual report's only real benefit seems to be to consolidate information in one place and provide easier access to financials. However, for the better performing groups, the website provides all the same information, if not more, so the only advantage seems to be the financial information. But because financial disclosures are limited to the statutory minimum, they provide little depth as to actual expenditures, whether expenses were double counted, etc. problems we have already found. As such, I am bound to think that they are a total waste of time, more meant as marketing material without much meet. They are useful to get some information or a quick idea of what the organization does or wants to do, but one is better off going to the website. That is not to say that they are all bad.

A few prospective donors have said that they would like to see annual reports to make funding decisions. I think this is mostly from corporate practice and not because anyone actually finds a great deal of value in them.

To be more useful, it would be nice to get more information into the reports regarding strategic planning aims, progress against performance measures, beneficiary voice, and overall strategy. Essentially…less what they are doing and more what they hope to achieve and how they are progressing on that.

Mumbai is in trouble!

2007-11-22T14:27:00.001+05:30

Alex and I attended a conference with high level officials from Mumbai and London, including London Mayor Ken Livingston. We concluded that Mumbai leadership has an unrealistic view about what is happening here and has satisfied themselves by hiring advisers to support their belief that as long as Mumbai keeps on its current path, it will be the greatest city in the world.

There seems to be no plan on how to tackle the problems that are apparent to everyone. In fact, I don’t think they recognize half the problems that there are. And a lot of this, I think comes from a lack of thinking about what they want to ultimately achieve. This is in strong contrast to what the London officials had to say. They saw a financially robust city economy as their vision and made development happen to accommodate that.

Article on Giving

2007-11-21T14:27:00.000+05:30

I read an article by Alex Hatton (“Guilt by Association,” Charity Times, Jan-Feb 2007. http://www.charitytimes.com/pages/ct_features/jan-feb07/text_features/ct_janfeb07_supfeature3_guilt_by_association.htm.) It is an interesting discussion of how its is significantly more expensive to secure new donors than existing donors and that guilt-based appeals discourage new donors. New donors require more information about how their money is being used and how it is making an impact. They also appreciate open discussions on aims and accomplishments and a focus on hope and progress instead of despair.

Social Exchanges

2007-11-19T14:26:00.000+05:30

I’ve read a couple recent articles from Mohammed Yunnis, in which he is calling on the development of social stock exchanges. He supports both the creation of platforms for companies that are spending resources on charitable pursuits, as well as listing civil society organizations that do “good.”

Thankfully, people have created many such social investment exchanges. In addition to GiveIndia, there are several online social investment exchanges. These groups do a phenomenal job and work longer hours than many bankers and lawyers I know to help civil society organizations. So if you are inclined to give, these are all reliable.

1. Bring Light www.bringlight.com

2. CanadaHelps: www.canadahelps.org

3. Changing the Present : www.changingthepresent.org

4. Charity Aid Foundation: www.cafonline.org

5. Conexion Colombia: www.conexioncolombia.com

6. DonorEdge www.donoredge.org

7. DonorsChoose: www.donorschoose.org

8. Give2Asia: www.give2asia.org

9. Give India: www.giveindia.org

10. GlobalGiving: www.globalgiving.com

11. Greater Good South Africa: www.greatergoodsa.co.za

12. Help Argentina: www.helpargentina.org

13. Just Give: www.justgive.org

14. Just Giving: www.justgiving.com

15. Kiva: www.kiva.org

16. Microplace: www.microplace.com

17. Modest Needs: www.modestneeds.com

18. Network for Good: www.networkforgood.org

19. Social Investment Exchange: www.sasix.co.za

20. Social Stock Exchange: www.bovespasocial.com.br

In case you didn't already distrust MPs...

2007-11-17T14:25:00.000+05:30

It turns out that of the 425 MPs, 360 of them list social work as their primary occupation – just giving credence to the belief that many Indian NGOs are just channels to funnel political money or launder graft.

Of course, this is not true for most NGOs, but it is a concern that requires some diligence and gives support to the Credibility Alliance/GiveIndia idea that political affiliation needs to be examined thoroughly.

Beneficiary Surveys as Enforcement Mechanism

2007-11-15T13:36:00.000+05:30

One of the problems with viewing civil society as a marketplace is that it suggests that social exchanges are like stock exchanges and encourages discussion of returns. I thinking focusing on social returns is a good idea and is a good way of explaining what "new philanthropy" is seeking. The problem is that it isn't exactly like a market because there is no enforcement mechanism. There is no penalty if you aren't listening to voices (like your beneficiaries) and it is hard for donors to know whether an NGO is listening to its beneficiary. A third party monitor is impractical and expensive. What we are toying around with is trying to put beneficiary survey information into reports and then educating donors why this information is important. If donors hold NGOs responsible for having high beneficiary feedback "scores", then there is the possibility for cheap self-regulation.

Pros and Cons of Government Involvement for Sustainable Development

2007-11-13T14:20:00.000+05:30

Indian law requires certain types of aid to pass through the government instead of private organizations. This is most apparent when one looks at UNICEF or World Bank funding, especially for education/child care. I’ve been struggling to determine whether this is a good thing or a bad thing.

On one hand you have a completely different model in Bangladesh. There the majority of funds pass through to private groups. The result is that private development organizations are extremely powerful in Bangladesh and do not have to be reliant on government as much. I’ve read conflicting stories on whether this lessens the sting of corruption, but one could see how it does.

Also, in a country where the government would not otherwise get involved and does not develop some sort of expertise, it is probably better to turn to private organizations.

But in India, where the government has taken the time to care about addressing social issues and has developed a certain amount of expertise (though many would dispute this), the partnership with government is probably very helpful – especially for sustainable development. Lots of the problems that India faces are not regional. They occur throughout the country. But most of the groups tend to focus on regional concerns and try to solve issues regionally before expanding outwards. In such a case, the government has an important role in sharing information and providing a platform to discuss issues. Also, where large scale problems are being tackled – education, trafficking, poverty – without government involvement it is virtually impossible to make large scale meaningful change.

What I need to find out now is what portion of aid is lost in overhead costs by going through the government and what benefit is gained by having the government involved. If the overall waste is large then I may rethink my position, but as it stands now, I think that it is probably a very good thing that the government is actively involved.

Wrong About Strategies vs. Prerequisites

2007-11-12T14:19:00.000+05:30

After doing a few more workshops, I think that my initial position on the strategy vs. prerequisites distinction was wrong. It is important to make a distinction between the two because strategies will change. They may not be successful in bringing about the necessary outcome or may have to be changed for various other reasons (e.g., resources, time, change in law). So, if a group lists a strategy instead of a prerequisite, then the map of the theory of change risks having to be changed more frequently than necessary. While the map is supposed to be a “living” document and should change, it should strive to remain as consistent as possible so that all stakeholders understand the larger picture.

Running an NGO is not your escape route from your current job...

2007-11-08T14:18:00.000+05:30

What I am finding is that the best NGO leaders do tend to have some private/business experience before entering civil society. The difference between the good NGO leaders and the mediocre/bad ones, is that the good ones are extremely good. They were not just skilled bankers, financiers, etc., they were likely near the top of whatever organization they were at before. This makes sense – running an NGO is much harder than most private business. Not only does the NGO head have to be the organizations visionary and force it to stay consistent to its goals, he or she is often called on to give advice in everyday problems. As a result, he or she needs to manage macro and micro problems. He or she needs to be a macro-level manager, while providing micro-level input. And if the NGO is really successful, he or she will likely be called on by other NGOs to help solve their problems – which, given how much all of the NGOs need each other to tackle larger issues, means he or she can’t say no to any requests for help. If this wasn’t enough, often that NGO leader will be the only one in his or her organization that is even remotely capable to taking on this much responsibility. So, my point is that just because a person is a successful student or businessperson, does not mean he or she will be a successful NGO manager…to be one you probably need to have been an exceptional student and a phenomenal businessperson.

Business Schools in India

2007-11-07T14:16:00.000+05:30

I’ve had several discussions with people writing articles on “new philanthropy’s” focus on bringing market ideas to NGOs and civil society in general. While I agree with many of those ideas – like transparency, disclosure of risks and key information, public reports – I am wary that emphasizing market concepts can thwart younger groups from going through the “inefficient” nascent stages of their development.

It is particularly important that people start voicing these types of concerns in India because the larger business culture is very strong here. The day that CAT (business school exam) was administered in India, it was the top story in all the papers and magazines and on TV. In fact, it was the top story for several days. That combined with this idolization of business icons, the prestige attached to conspicuous consumption, and generally all things market and growth oriented could be very dangerous. Not only are the problems I mentioned above a concern, but as NGOs do operate more like businesses and their public/annual reports more closely resemble capital market disclosures, there is a possibility that donors will grow to think that because they have significant business experience it will be valuable for them to opine about the day to day practices of the NGOs they support. While active interest is crucial, I think it is important to remember that the organizations will more often than not know what’s best.

I’ve heard some anecdotal evidence to support this but will track it during the donor-engagement stages to see if it is true – especially for Indian donors.

Cost of Living

2007-11-05T14:15:00.000+05:30

The overall theme of our portfolio seems to slowly be coming together – education and care for those children that fall outside India’s prosperity bubble. While India is experiencing a booming economy, it is not filtering to everyone. It is exaggerating the disparity in income and makes the gap larger and larger. What is worse is that in the cities experiencing the most economic growth – Mumbai, Bangalore, Delhi, Chennai, Chandigarh, and Kolkata – the growth hurts those that don’t benefit even more. This was striking in Bangalore, where the IT boom has pushed housing, transportation, food, entertainment, and just about every other cost significantly up. While people making Western salaries and inflated Indian salaries can cope with this, the majority – who do not benefit from this boom at all – are left much worse off because now they have to pay much higher costs with the same salary they had years ago – before the boom. As a result, the fall further and further down the leader and are unlikely to come up – all of which exaggerates the disparity even more.

In our group of NGOs, we have several education and care charities for children who are not able to participate in the elite or better Indian private school. So we have groups trying to reform the public school, creating private schools for slum children, schooling and training disabled children, working with street children, providing care for the orphaned and abused. There are some more that fall outside this group but for the pilot this seems to be the unifying theme.

Audits in India

2007-11-02T14:14:00.000+05:30

We have met with a couple of NGOs that have already gone through their own audits before meeting with us. As would be expected some are more useful than others. Most audits are hybrids, but roughly, there seem to be three general types of audits in India.

The first – and most common -- type of audit is a “Financial Audit”. It aims to see that resources are properly accounted for and are used accurately. If the NGO has a limited number of accounts, these generally tend to be good. But if the NGO has multiple accounts and multiple ledgers – as many tend to have – the audits are too superficial to be meaningful. There needs to be a more thorough effort in many of these audits to compare expenditures and revenues across the accounts to ensure that there are not abuses (such as debiting one expense several times or paying salaries multiple times).

The second type is an “Organizational Review” – it tends to summarize what the NGO does and then tries to categories that information into categories so that the NGO can best see how to proceed, use resources, and what activities to more actively pursue. The primary use of this model is that it helps give context to a complicated organization’s operations. It does little, however, to help the NGO reflect on why it is doing something or how it fits into its overall objectives.

The third type is the “Strategic Review.” This audit tries to capture a mission statement and then look at what the group does and project a three or five year plan. While some effort is made at trying to identify the overall outcome the NGO wishes to achieve, it is not usually captured in terms of what is generally achievable. It is often too lofty. As a result, the three and five year plans sound great but are more often over ambitious proclamations than real strategies. They also tend to focus on scaling up without true thought on whether this it is in the organization’s best interest (or if it is, then if scaling up is done in an appropriate time frame or scope) and on increasing fundraising. In fact, almost every one of these “Strategic Reviews” has a sizeable section on increased fundraising.

What I think is the benefit of our process is that it offers very little in terms of advice on what changes need to be made or how to make necessary changes. Instead, it works as an organizational tool by helping NGOs see exactly what they want to achieve and what they will have to do to reach that (practically achievable) result.

This is supplemented by the reporting template Alex and I are developing. The report forces NGOs to identify their main activities, how successful these activities are and the evidence for these results, their overall strategy are following. This helps the NGO see what activities might not fit into their overall goals and where to focus resources. Further, by making sure that the NGOs clarify the overall environment and context in which they are operating, they are forced to make sure there activities are practical. Additionally, we require NGOs to explain and examine their finances more clearly. This works in combination with the organizational reporting sections to make NGOs consider whether they are using resources adequately. Once the report is completed, the NGO not only has a roadmap of how to achieve results it wishes to achieve, but also can see whether its current activities are helping it to reach those results. While we function as a sounding board, we leave the ultimate decision on how to make necessary changes in practices or strategy to the NGO (which best understands how to solve the problem). By doing so, we also avoid some of the really ridiculous solutions we have seen proposed by some outside auditors.

Interesting Article on Non-Profit Marketplaces

2007-10-27T19:03:00.000+05:30

This is an interesting article on social investment marketplaces.

http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=7283&s_oo=pOCReJ0tTPleBINxFyKyOw..

Second Workshop Observations

2007-10-26T17:54:00.000+05:30

The second workshop differed from the first in that there were two NGOs instead of three and one representative came from each NGO instead of several. It started as an informal conversation. The NGOs explained what they do and what they would like to do. They then discussed the problems that they had with donors and engaging with them. It was a lot more open than the previous session, possibly because the representatives each were the only ones from their organization and therefore didn’t have to worry about being accountable to someone else they worked with or feel inhibited. It is a different dynamic but both seem worthwhile. This format yield more honest discussion. The other more intense debate about the organization and with more people it is more likely that the group of representatives will be able to explain the framework to the entire NGO.

Specific Observations

1. Jargon. As we saw on the first day, the NGOs frequently will use jargon to communicate their thoughts and have to be instructed to clarify what they actually mean.

2. Defining Success. The NGOs seem to really enjoy the epitaph exercise and see the benefit in being forced to define themselves in terms of achievement as opposed to what they do. The one stumbling block is that they seem inevitably to phrase their initial view of success at least in part as what they do. We try to force them out of it and develop a statement without stating what they do. But it seems that if one is going to write an epitaph that it would include what one does. And this seems to frustrate the NGOs a bit. It means we either change the exercise from writing an epitaph or we just let them write it and then edit it out ourselves. Maybe we could put their epitaph on a board and physically remove all references to things they do and change verbs from the past tense to the present. This might even be more dramatic.

3. Do we need eco-mapping to be its own step? Currently, we start with a statement of success (Step 1), then determine outcomes necessary for success (the vision of success), then map out the ecosystem, and finally come back to determine the prerequisite conditions. It seems that by placing the ecosystem exercise where it is we break up the NGOs thinking on its theory of change. While it is important to map out the ecosystem, we seem to be doing it when we are developing the vision of success (Step 2). We ask the NGOs to state what the conditions, attitudes, behavior, and relationships would look like in a world where they had achieved success and make them phrase these in terms of outcomes. This step requires them to consider all the actors that they would have to interact with (positively and negatively). We could make this clearer by saying that they should first list all the people/relationships that are crucial to them achieving success and then list all the conditions, attitudes, and behavior changes that will have to exist for them to have success. That way we can move from them developing outcome statements to listing the prerequisites for those conditions. I think that would allow them to see how they have developed a theory of change and then how each prerequisite (Step 3) logically leads to an outcome and that those outcomes lead to success. It might also help see each prerequisite as something to measure, to be measured against, and to validate. It also would be a good breaking point, so that when we come back together we could discuss how to measure, report, and validate success (and failure) in terms of that map of the theory of change. (Step 4 (Reporting) and Step 5 (Validation).)

A possible new sequence could look like this:

4. Do we need to be more flexible with prerequisites? We are finding that when the NGOs define the prerequisite conditions they also mix in strategy. On one hand it is good to make them distinguish between the two. But seeing as there will be a lot of overlap, it may make sense to list all of them and then narrow them down into things that are not redundant and then from there see if some collapse into each other.

5. We need to be more clearly explain reporting. Right now we give them a few suggestions and say it is really up to them. This seems to confuse them and they lose a bit of the trust in us that we had secured up that point. What we can do is move from preconditions/strategy section to working with them to develop a way to report all of these preconditions. By that point we would have explained that the preconditions also function as performance indicators. We could then show them how some of those could be measured quantitatively (e.g. teachers hired, students enrolled) and others need to be measured qualitatively (e.g. children’s increased feeling of security or increased participation). It would also help to show why beneficiary and other constituent voice is necessary to measure qualitative things. After all this, I believe that we would more easily be able explain how we could incorporate all this information into a report to donors that provides both traditional necessary information (organization’s profile, financials, governance) as well as information on how the NGO is helping to make sustainable change.

6. This framework may be too rigid to work for all groups. We already acknowledge that this framework does not really help relief type organizations – like natural disaster relief. We are aimed at sustainable development and process change. But some groups fall in between. For example, if you are working on learning disabilities you may do a few things to change overall society – like lobbying, trying to support curriculum change – but you may be just as happy to partner with another group and leave that part of the solution to them and instead focus on educating children. These groups are no less involved in the process of change; they just don’t have the resources or whatever to take a more global approach. I think we can still help them, but we need to tailor some of the scope of the framework to allow for more input-output thinking for them.

Other Observations

1. Multiple Accounts. It is really clear that when we examine the NGOs financials we have to do more than ask for required filings or see that expenses add up. Because of statutory requirements (for example the need to separately account for foreign funds) and donor conditions (their grants be tracked in separate accounts with separate ledgers), NGOs often have multiple accounts. It is not uncommon to have 5 or 10 different accounts. While this makes tracking easier in some sense, it makes abuse also possible. Funds can be transferred from one project to another. Expenses can be debited to multiple accounts. Salaries can be paid multiple times. The point is that misdeeds or untruths can easily be hidden if one does not do more than see that the numbers add up.

2. Donors need to understand that they are funding a process not a project. I think that if we get donors that understand the problems NGOs face in terms of budgeting or if we get donors who want to fund a process, some of the NGO practices that see them playing a shell game with funds could go away. That is not to say that NGOs are lying about money. With the NGOs we’ve seen the opposite is true. They are all very transparent with their accounting. I refer more to what we’ve heard anecdotally or what seems to be a donor fear. If funds are going to a process and less to a project, then maybe the NGO will feel comfortable telling the donor that it needs to reroute the funds. Then the two can have an honest discussion.

3. At least we aren’t . . . . One of the NGOs told us that they were working with some outside help from a group of US business students who were studying in India. After completing their in depth study of the NGO – which focused on children with learning disabilities – the group suggested to the NGO’s board that the organization should refocus its efforts toward helping HIV+ children. Ugh. At least we are better than that.

First Workshop Observations

2007-10-25T17:49:00.000+05:30

Our first workshop consisted of three NGOs. One came three representatives; one came with two representatives; and one came with one representative. It seemed to help to have multiple representatives from an organization so that when we broke apart in groups, they could discuss things with their colleagues. We paired the NGO with one representative with the group with two representatives and had them focus on discussing issues for the NGO with two representatives. Of course, the solo NGO seemed annoyed at first (in fairness to us they were told to bring at least two representatives), but the NGO with two representatives accommodated that NGO so in the end they discussed issues for both groups. We also floated in to help the solo NGO discuss issues. It showed the importance of our pre-workshop diligence, without which it would not have been possible to help that NGO. In the future, we either need to be equally prepared or more forceful in requiring the solo groups to work in combination. As a side note, it also seemed to please the NGOs that we were putting Give through the same exercise. It may be worth doing that for each initial group or having prepared answers for what Give would say.

Initial Feedback as to Motivation

The bad news…I was wrong.....the donor hook was important in getting NGOs interested in the program.

The good news….almost from the beginning, the NGOs understood the value of this reporting framework and were very excited to start seeing things in terms of outcomes and achievement. They were even more excited that donors increasingly want to be part of sustainable and long term change and that there is a growing body of donors who want more than a two page proposal and would prefer to have a continuing and active dialogue. While they still had some concern as to what information donors wanted, by the end they were willing to accept that donors could be convinced that open and honest discussion between all those interested in the issue was to their advantage and something they would want.

The really good news…the NGOs are excited to get things going and are asking to set up follow-up meetings as soon as possible. They are also looking to work with other staff to prepare for the follow-ups. All these are great signs and hopefully suggest that we might be successful in getting NGOs to implement these steps.

Specific Observations

1. It’s what you want to achieve, not what you do. At first, NGOs framed things almost exclusively in terms of what they did (we care for kids, we educate kids, we feed kids) rather than what they want to achieve. This is something we expected. It took a few exercises (through the mapping of the vision of success) for the NGOs to understand how they could frame things in terms of achievement. We need to do a better job of explaining to them why this is important and not just semantics. I think that saying the “looking from the clouds” example worked well (“If I was looking down from the clouds at the organizations, what would I see?”).

2. Strategy vs. Prerequisite Condition: NGOs had a difficult time figuring out what was a precondition to achieving the outcomes it mapped out as necessary to achieving success and what was a strategy to make those preconditions come about. Again, we need to do a better job of explaining why this isn’t semantics and should clarify that it often is a blurry line.

3. Prerequisite Conditions as Success Indicators. We need to explain how the NGOs can qualitatively measure success (as well as quantitatively where appropriate) by looking at the preconditions they listed. We should also work them through the logical steps – (if the preconditions are correct and are satisfied, then the outcome should come about. And if the various outcomes come about, then success should be achieved.)

4. Planners vs. Searchers and Process vs. Project: The NGOs not only got this, but seemed to get very excited by it. It was as if someone finally verbalized what they were thinking. They view themselves as searchers engaged in a process of change. And they are most interested in (and excited by) donors who see themselves similarly – as searchers looking to support a process (rather than planners who sit back – lawyer jokes work well here! – and think of some strategy implemented through a series of preconceived projects).

Areas We Need to Improvement and Clarify

1. We need to make the process more linear. This does not mean we should go back to input-output type thinking, but more that we need to somehow use each step to build for the next one. We are trying to do that, but we are losing the groups at some point. I think it tends to be at the constituent voice consideration point. They often express confusion as to where this fits into the process and how it is different from mapping their ecosystem. It could also be that the eco-mapping exercise should be moved after the preconditions because it seems to stop the progress we are making up to that point. One possible revisions could be this: (1) epitaph exercise – aimed at a defining success; (2) map out the vision of success (all in terms of outcomes) – who is involved; how are they involved; how must their views change? what larger changes must happen; (3) breakdown the perquisite conditions that must occur to make those outcomes happen; (4) who or what could have an effect (positive and negative) on the achievement of those outcomes (this is the ecosystem); and (5) how can we measure success (including who to ask, what to ask, and how to record it).

2. We need to provide NGOs with a deeper understanding of what new philanthropy seeks and why these donors are willing to engage in a long term dialogue. This might be solved by providing or summarizing articles and surveys, as well as providing additional anecdotal support.

Other Observations

1. Sustainable development takes time and time to understand. It takes until the vision of success is mapped to get most NGOs to think about sustainable development instead of specific projects or development that is not sustainable.

2. Paternalism: Some NGOs view themselves believe that they may know solutions to the problems better than there beneficiaries. I don’t know if that is true or not (it could be sometimes) but that sort of paternal attitude without a willingness to engage in an active dialogue with beneficiaries could be dangerous.

3. Indian Companies are a huge resource. I am not sure if this is true for all companies, but I have know met with several Indian companies who are really excited by the Keystone framework and the idea of incorporating it into their grant making. These companies have not previously expressed interest in funding projects or organizations but the idea of being part of a process excites them. We should be able to partner them with some great NGOs.

Community Organization as Auditor

2007-10-24T17:48:00.000+05:30

Unlike a domestic donor, which can visit the NGO regularly to ask questions and observe whether its funds are being optimally used, a foreign donor is limited in its ability to actively monitor. One possible solution to this lies with community organizations.

Community organizations consisting of people who care about the issue have a significant interest in making sure that the NGO is optimally using resources to tackle the problem. They would be an important constituent and one who is likely to actively voice his or her opinion if given the opportunity.

A foreign donor could use the community organization as its proxy. The question then is: how can the donor support the community organization? While it would be great to fund the community organization through direct funds or by earmarking a portion of a donation/grant to support interactions with community organizations (or the creation of such organizations), as soon as the organization is funded it faces many other problems. It may be considered an NGO itself, which opens up its own oversight issues. It may also then have additional reporting and statutory requirements – things it may wish to avoid.

Thus, the donor needs to find a way to support community oversight without actually giving it funds. One way to do this is to insist that the NGO it supports actually engages with a community organization consisting of interested parties. This could be done by requiring it to solicit feedback through surveys, town meetings, or allowing members of the community organization on an NGOs advisory board. The donor could not only ensure that the community’s voice was being heard, but could also make sure it was being considered by tracking how active those on the advisory board were or even by seeing if people from the community who were placed on the advisory board later took more active roles in the NGO.

There are no doubt better ways to do this. But my point is that if foreign donors come to understand that one of their best proxies for diligence is an already existing and interested community (rather than sending agents for a couple days), then they can help to ensure that NGOs listen to their beneficiaries and constituents. They can help foster an active dialogue between all concerned constituents.

What Informs Donation Decisions?

2007-10-21T18:31:00.000+05:30

Give is hoping to create a social exchange. Ultimately, it would stop evaluating NGOs using specific criteria to determine whether they should be listed on the Give site and would function more as typical stock exchange – listing if the group meets certain minimum criteria and leaving ratings to others.

One of the hopes in creating an online market place is that with greater information available through the internet, donors will use this information to educate their charitable decisions so that they do not rely on proxies for outcomes.

What I mean is that they don’t look at some statistic like number of schools built but question how the schools operate, whether they are they right type of schools, whether the children are getting an education that allows them to get future jobs, or higher education, or whatever the end result sought.Unfortunately, what seems to be happening is that internet is just reinforcing the practices of non-online donating. People still rely on images of starving children, etc. and that sways donating decisions.

If that is the case, then I wonder how useful a reporting framework will be? The key it seems to me is not convincing NGOs of why working through a process that clearly articulates outcomes sought and what needs to be done to get there is right, but instead convincing donors that they need to do more and need to take more responsibility. They need to demand more information and they need to really think about what they want to accomplish. While this might work when holding the hands of certain individuals or companies, I don’t know how this works without holding their hands and acting as some sort of “charitable” wealth advisor.

What would be useful is some sort of survey about what donors want from their donations. Do they want to actually have a certain impact, regardless of publicity or “graphic” measures, or do they want to engage in a process that sees slow but (hopefully) definite social change. I don’t mean for this to be full of judgment (which it definitely reads as) but I don’t know. I would be interested in any good donor surveys that people could recommend. I’ll post a summary of the ones I have and any I get soon.

Acknowledging Failure

2007-10-20T18:28:00.000+05:30

One of the key things that we hope that this Initiative can accomplish is to “de-penalize” failures. Currently, if an organization fails to reach a stated goal and brings that to either the donors’ or the social marketplace’s attention, it is penalized for doing so. The problem is most significant when looking at donor decisions. Donors may question the failure – often without waiting or looking for explanation – and decrease or shy away from future support. It is also likely that there will be a greater emphasis on failures as opposed to successes.

Although questioning failures is healthy and necessary, the unfair stigma attached to them often results in NGOs neglecting to mention or even discuss its failures. A simple glance through NGO annual reports will confirm this. It is our hope that through this reporting framework that at least some of this stigma can be removed and NGOs can be encouraged to more openly discuss failures.

The first step in changing this behavior is getting NGOs to correctly identify their theories of change. If they successfully identify their theories of change – not just as a mission statement, but rather, as a statement of desired outcomes and how they directly plan to achieve these outcomes – then they can more easily identify the perquisite conditions that will achieve these outcomes. The key is to identify those prerequisite conditions that if completed or achieved would logically lead to the desired outcome. If this is done, then the prerequisites could serve as a “goals” or “to do” list for the NGOs. More importantly, the prerequisites could also serve as performance indicators. One would be able to see how well the organization was doing by seeing how many of its prerequisite conditions it was satisfying. And unlike, say knowing how many school lunches an organization provided, a donor or stakeholder or anyone else interested in the NGO could see how the NGO was doing in the larger picture – how many lunches it provided, along with whether they were healthy, whether they were helping kids be more engaged in school, etc.

A failure of one of the prerequisites, then could be judged in terms of its impact on the desired outcome and the how well the other prerequisites were being met. We would hope that NGOs would be more likely to identify these failures and explain their impact. And correspondingly, donors would see any failure with the proper perspective.

This isn’t likely something that will happen all at once, and probably not at all in the beginning, but it is essential to a proper dialogue between the donor and the NGO and any reporting framework that doesn’t address this issue would have a significant hole.

My guess is that it will take a lot of explaining to both donors and NGOs as to why such reporting is essential and why without it neither is likely at to be able to fairly measure or communicate success. I’m just not sure how we do this yet (other than explain that it is needed and hope everyone agrees).

First Steps: Selecting and Soliciting NGOs

2007-10-19T14:00:00.001+05:30

Once in Mumbai we started be selecting specific children’s related charities that we hoped to work with. We carefully chose this set from those that were already listed on Give’s site because: (1) we could be assured that they had already met and were continuing to meet Give’s demanding criteria; and (2) they would be open to working with us. It was even more important because given the one-year time frame, and the six-month period in which we hoped to have a pilot group ready to take to donors. With such a tight time frame for the pilot group, we really benefited from Give already having many of the documents we needed to review for our diligence and could build on Give’s relationship to ensure an easier time completing any additional diligence.

Once we identified potential pilot partner NGOs, we drafted an explanatory email and a document explaining the goals of the reporting and learning framework to go with the prospectus. With this package of documents, we began to solicit partners for the Initiative. (Attached is the sample template we used to solicit NGOs through email and the document summarizing the goals of the framework.)

We were surprised by the overwhelming interest as a great number – to date (a week after sending the initial emails) approximately 60% of NGOs expressed great interest in the Initiative (and even one that heard about it through another NGO). What is even more exciting is that we demanded that the boards of the NGOs that wished to participate discuss the Initiative, approve participation, and be willing to participate. All of the participant NGOs had done so and many were ready for their entire boards to participate in the workshops.

Another pleasant surprise was that the NGOs really seemed to understand that the real carrot in this process was not the money they could hopefully see, but the more dynamic and engaged relationship that they could have with their beneficiaries and donors. Whether this is true or just some clever chicanery, we’ll have to see. But it would surprise me if it wasn't true.

On the other hand there does seem to be a lot of attention to “revenue generation” and concern with financial accountability. One of the interesting things about NGOs operating in India is that they – like everything else in India – are greatly influenced by India’s new found prosperity. Many of the leaders of these NGOs have or had significant experience in the corporate sector in areas like banking, finance, accounting, and consulting. As a result they are very well versed in the corporate dialogue and are tuned into the movement to implement market ideas into the charitable world. In addition to financial accountability there is also a lot of discussion about “adding value”. (I’m still not sure whether all of this market discussion is entirely well-suited for the NGOs. There seems to be some conflict with “adding value” and doing charitable work. Especially with young organizations, the “value adding” constraints may inhibit innovative work. Also for all the discussion on accountability, I’m not sure how much extends beyond financial accountability into accountability in terms of effectively reaching outcomes or effectiveness as seen through other stakeholders’ and beneficiaries’ eyes.)

Nevertheless, I think it is probably this experience that explains why so many understand transparency and why they should be accountable and responsible to their beneficiaries. (Of course, our pilot group is comprised of Give listed organizations – and therefore – already have to be transparent with information. But there seems to be a deeper understanding of why that could be helpful.)

There also seems to be an increasing recognition that accountability means more than financial accountability. What we are not sure of yet is how deep this understanding is. Groups like Give and CRY recognize the need for accountability to be more than financial and for it to capture effectiveness, and CRY is leading an initiative to try to educate and train auditors as to how to evaluate NGOs and how that is unique from corporate auditing. I know that CRY and Give had previously discussed other plans to make such a program national, but I don’t believe that it has taken off yet. Hopefully, we can contribute to that movement through our work with the CMI.

Starting the CMI

2007-10-19T13:53:00.000+05:30

The Charitable Measurement Initiative is a collaboration of people and organizations that are deeply committed to the belief that social change organizations can mobilize significant new and better investment if they are able to implement a measurement reporting framework that credibly communicates their real impact to donors. The Initiative is directed by GiveIndia (www.giveindia.org) and calls on the resources of pilot program partners Keystone Accountability, (www.keystoneaccountability.org), Global Giving (www.globalgiving.com), and New Philanthropy Capital (www.philanthropycapital.org), as well as many other organizations committed to social welfare.

Both Alex and I started on this process when we decided that we wanted to combine our previous experiences in humanitarian and charitable work with our current work as corporate lawyers. We were hoping to find a group in India that was looking to incorporate capital market/securities like concepts in reporting and analysis to create more valuable and transparent information.

Thankfully, we were put in touch with GiveIndia, they discussed the idea of running a pilot program implementing the Keystone framework developed by Keystone Accountability to see if we could help organizations more clearly articulate the outcomes they wanted and better communicate their actual results to donors. This was exactly what we were hoping to do and gladly agreed to donate a year of time to making this work.

While we were in London, Give put us in touch with Keystone Accountability and New Philanthropy Capital. After many meetings throughout the spring and summer, we arrived at our joint creation – the Charitable Measurement Initiative – and a plan as to how we would seek to help NGOs in India become more transparent, responsive, and efficient, as well as helping donors become more engaged and involved. Our initial prospectus, summarizing our thoughts, the reasons for the NGOs we selected, guesses at a time frame, and general plans is attached.

Dedication

2007-10-19T13:41:00.000+05:30

Although we have decided to not use the names of specific people other than ourselves in this blog, we wanted to thank the many individuals at Give, Keystone, NPC, and CRY who have given us advice, support, and the opportunity to work with them on this exciting project. Clichés aside, we are deeply humbled by their commitment and are honored to learn from them.