Many of us dance between thinking and writing about our work and being the practitioner fully focused on doing the work. With this dance in mind, I took most of last year off from writing while focused on growing Sou Digna/ I Am Worthy and our partnership with an amazing community of women in Salvador, Brazil. (I wrote about a previous visit with these women in February 2012.) In addition, a few of us Seattle-based NGOs have grown the Collaboratory Network, building the capacity and connection of small NGOs working across cultures. The dance continues, but I am excited to share what I can in between sets.
Yesterday, I had the pleasure of talking with a group of women working to improve the lives of women around the world. Our topic was “Financial Accountability Across Cultures,” and what follows are the notes that I shared based on my experiences bridging the reality of small NGOs working in poor communities with funders somewhere else in the world. Am I missing anything? Please share…
FINANCIAL ACCOUNTABILITY ACROSS CULTURES
Small NGOs are structured communities trying to address some problem in their society. Their long term success depends on providing the services needed while building their internal capacity and external connections to deliver those services into the future. Donors play a critical role in keeping an eye on the long term in the face of tremendous immediate need.
What should you look for in the finances of a small NGO to know if money is well spent?
First, “well spent” is in the eye of the beholder and culture-bound. It could be interpreted to mean:
- A lot is happening
- Financials aligned with budget
- Audited financials
- Low percent going to administration
A financially-healthy organization has diverse markers in place.
- A lot is happening, both tied to impact measures and not. Remember that a lot of social change happens at the margins of pre-determined programs.
- Capacity to track financials (staffing, technology)
- Evaluation plan and practice in place
- “Clean” reputation of local leader as determined by local people
- Regular opportunities for exchange across cultures and borders
How do you give an international organization voice in explaining its work within the exchange of financial reports?
Power and perceptions of power permeate the donor-donee-local partner relationship.
- Look for ways to have direct conversations (in person, via skype)
- Keep an eye on partnerships where one side is always speaking for the other side
- Encourage local voice as a part of grant arrangement
- Keep power in mind in cases of negative information
- Put financial reports in perspectve… what matters is impact, not the exact accounting of funds in budgeted line items
How can donors help good organizations become more financially healthy through targeted investments?
Fund the internal infrastructure needed to sustain financial health.
- Fund the administrative costs tied to financial oversight
- Fund evaluation of programs
- Fund capacity building and staff training
- Fund staff exchanges in both directions
Take a learning approach.