What is the role of NGOs?

NGOs (Non Governmental Organisations) is a very loose term covering all kinds of organisations: normally anything that is not a government or for-profit enterprise. It could include churches, chambers of commerce, business association, lobby groups, trade unions, charities and more.. However the way it is generally used is to describe an organisation that is organised like a business in order to serve a social purpose and without focusing on profits.

Thus typically there are 'grass-roots' NGOs often formed from a few volunteers campaigning for a local issue or providing care for some disadvantaged section of society; there are larger charities that provide welfare to those in need and there are the bigger Development NGOs that aim to influence government and business and effectively use resources to e.g. reduce poverty on a large scale.

Moving quickly past such a brief summary, in recent times there has been a blurring between business and NGOs into the so-called world of 'social enterprises' whose primary goal is to serve society but who wish to make profits at the same time. Many think that these are more effective at solving societal problems as it is more sustainable, more competitive and more efficient. It is noted that the best way to solve problems requires large-scale solutions and these kinds of scales or innovations are often only achieved through a profit incentive and a functioning market to make organisations more effective.

NGOs are often profitable in some sense: selling a service to make money (e.g. running a home for disabled people) or providing benefits to a corporate partner (e.g. advise on reducing their environmental footprint or training their suppliers) -they just pay less tax and promise to spend any profit on further programs. They do not have owners as such, and this is normally seen as their advantage: no money to stock-holders or to rich private owners. However it is also seen as a disadvantage: who are they accountable to?

Interestingly NGOs and businesses alike seem to be converging on a model that governments ar supposed to use -but often fail to do so. The model of being accountable to various stakeholders locally and otherwise. Governments are notoriously slow to change, and rarely due if changes negatively impact those in power, or those who might get in power. Now that many companies engage with local groups; NGOs engage with local governments and communities it seems like both sectors are listening.

It's pretty clear that NGOs are not changing the World; neither are ineffective governments (which are still too frequent around); and neither are aid agencies. Business, it seems, could be the answer; but it requires a stable environment and infrastructure and this is often lacking. Thus the current trend for NGOs to work with governments and businesses (using Aid) to try to focus on this issue 'sustainable livelihoods'. Is this the future role for NGOs?

As the most trusted type of organisation in the World, will NGOs be able to bring partners and stakeholders together to find solutions to allow business to flourish -to create meaningful jobs? Jobs, is the ultimate issue here -and this is really only something that a business (whether it is for-profit or not; including collaboratives) can provide. This week the good news is that more people have jobs now than ever before, but more people do not have jobs too (as the population constantly grows).

I am excited by some of the work that Plan is doing in China: trialling new methods and schemes that government (especially in developing countries) is unable to try (too slow, too corrupt, too cumbersome, too political, too hierarchical, too poorly trained); raising issues that otherwise have no-one to raise them and so on. The end result should be either government, business, or individuals doing something different that is better than what they were doing before.

The problem is so much that NGOs do is not sustainable, not an efficient use of resources -and often fails. Not that it is always their fault: after all most businesses fail too. Interestingly NGOs tend to try much much harder than businesses to make their projects a success. I am still looking for the balance between time/money spent researching, measuring etc vs. actually doing, subsidising, training etc.

In the future I see NGOs having to better define their 'ownership' in order to work out where they fit in society; since their roles overlap with all other sectors (including the media). I see them struggling to keep their 'independence' whilst being involved in so many 'partnerships' (including revenue generating activities). I think accountability will be come a bigger issue: NGOs will have to carefully balance how they spend their money on staff (pay more to get better?) and on research and evaluation. But I hope that NGOs will be given more slack to fail more, learn lessons and so on. International NGOs will need to start incubating ideas, being more innovative, spinning off from themselves to remain flexible and innovative and better define their relationships and purpose to other (grass-roots) NGOs.

In many areas NGOs are in competition with each other for resources: a good thing no doubt; but more partnerships are likely to form to prevent competition ruining funding streams or affecting transparency. NGOs have undoubtedly become more professional; and the next step is to move into the relm of M&A, spin-offs and so on. It excites me to end this post with the concept of taking the real world to NGOs: could venture capitalism have a role with development? How can you define the worth of an NGO? There already exists 'tables' of NGOs which are most effective with their money. It would be great if these very basic methodologies could develop -and who knows what might happen?

Business is having its time turning into an NGO through social enterprises; now NGOs need to do their bit to come towards business by tackling the challenges outlined above. And, who knows maybe a time will come when NGOs and Business will be one and the same -all serving to create jobs and services that society needs, whilst being accountable (and responsible) to society.