Global Policy Forum

By Hugh Williamson*

International NGOs are bracing themselves for greater public scrutiny of whether they should be trusted to do what is right. They have become familiar with business strategies and aware of the value of their brands.

If opinion surveys and the international media are to be believed, the influence of non-governmental organisations (NGOs) is on the rise. A poll published in January by Edelman, a US-based public relations firm, suggested that NGOs in general are more "trusted" to "do what is right" than governments and business. The survey indicated that trust in NGOs among business people and "opinion leaders" has grown over time and now outstrips trust in states or enterprises in the US and Europe. In China, Brazil and Japan NGOs receive similar trust ratings as companies. Greenpeace, Amnesty International, Oxfam and the WWF conservation group are the most trusted NGOs.

Meanwhile the NGOs that were invited to this year's World Economic Forum in Davos also had an impact. Political and business leaders spent much time focussing on issues such as climate change and debt cancellation. And in the field of corporate social responsibility (CSR), the achievements of NGOs in pressing companies to focus on social and development issues are also gaining wider recognition. As the Economist recently wrote, "CSR commands the attention of executives everywhere and especially the managers of multinational companies headquartered in the US or Europe. This marks a significant victory in the battle of ideas". The Economist listed NGOs among the forces "that pushed for CSR in the first place".

In addition, the real work of NGOs – at least those busy with emergency relief and reconstruction – has also been praised, following the tsunami in South and Southeast Asia in December. NGOs were seen to have reacted quickly and in a more co-ordinated way than in the past, a trend rewarded with unprecedented levels of private and corporate donations.

But does such positive resonance towards NGOs come at a price? In recent years suggestions that NGOs are gaining influence compared with governments or companies has been accompanied by a parallel surge in interest in the responsibilities such power brings. In what some term a backlash against NGOs, this debate has focused on the "accountability" of NGOs to some or all of their various stakeholders, and, more broadly, on their "legitimacy".

Among NGO leaders, a sense of foreboding has hovered over the relatively low-key nature of this backlash. Is it a calm before the storm? John Elkington, head of Sustainability, a London-based management consultancy specialising in CSR and business-NGO relations puts it this way: Unless NGOs are careful, and are ready for more intense public scrutiny, then an NGO ethics scandal on the scale of the crisis that hit US energy giant Enron may be lurking around the corner. In this context, the publication last year of Sebastian Mallaby's book "The World's Banker" may have raised the stakes for NGOs by opening the debate on their role and influence to a much wider audience. While ostensibly about World Bank president James Wolfensohn's leadership, the book's critique of the strong influence of NGOs on the Bank and on wider development issues has attracted as much, if not more attention.

Using examples from Uganda, China and elsewhere, Mr Mallaby argues that NGOs, especially those based in Northern countries, hardly deserve high public trust because they are often ill-informed and incoherent, unaccountable and uncompromising, and even damaging to the development causes they proclaim to champion. While noting somewhat patronisingly the existence of some "grown-up NGOs" such as Oxfam, he concludes that the World Bank – and, by implication, policy makers in general – should in future be more resistant to NGO pressure.

In the spotlight

Mallaby's book is not the only recent high-profile publication to draw a wider audience's attention to the apparent shortcomings of NGOs. "Why Globalisation Works" by Martin Wolf, chief economics editor of the Financial Times, strikes a similar chord. For NGO leaders willing to engage in this debate, his book must be a rather painful read. A point early in the book sets the tone: "An immense literature of complaint (by anti-globalisation supporters) has grown up, almost all of it distinguished by disregard for facts and professional economic analysis." If such books do indeed play a role in placing ongoing discussions on NGO legitimacy nearer the centre stage of public debate, then this raises the question of whether NGOs are ready to be in the spotlight. Indeed, there is a heightened recognition among NGO leaders that they will need to do more to challenge this criticism and to stabilise the level of trust their organisations enjoy.

Jonathon Porritt, former head of the UK section of Friends of the Earth, argues that "NGOs are beginning to recognise that all the things that we have been telling companies to do, in terms of ethical standards of behaviour, also need to apply to the NGOs themselves. In that sense this is really a changing world." David Nussbaum, executive director of the Berlin-based Transparency International (TI) anti-corruption watchdog organisation, ads that "governments in the South are increasingly complaining about Northern NGOs". Officials in developing countries, according to Nussbaum, argue that educated elites might agree with the NGOs, "but the mass of the population don't". Therefore, international NGOs need to find ways of answering such questions as "Who are NGOs speaking for?"

To tackle such challenges, 30 international NGOs established a loose network as early as 2003. "We recognised the need for a forum to discuss issues that cut across our work, issues that we all see as common challenges," Nussbaum recalls. Members include Greenpeace, Oxfam International, Care, Médecins Sans Frontií¨res, Terre des Hommes, Amnesty International, WWF and TI itself. The top executives of the organisations involved meet annually.

The network also works on the basis that growing influence has brought challenges, both externally (in responding more effectively to the rapidly changing global political and economic environment) and internally (regarding challenges to NGOs' sustainability, resources and organisational structures). In essence, the NGOs have recognised that they need to create collective learning and strategic thinking processes, Mr Nussbaum concludes.

The results of those processes will strengthen NGOs for the battles ahead, says Jeremy Hobbs, executive director of Oxfam International. "We accept that, as we step up our campaigning, we will increasingly get a push-back, especially on issues such as corporate social responsibility. That is legitimate. But we are worried that this drive for more accountability may be used by, say, right-wing think tanks, to propose limits on our advocacy work." NGOs have to be ready to resist this, he says.

Irene Khan, secretary general of Amnesty International, highlights an additional way in which NGOs are recognising their need to sharpen up – in this case via external professional help. Since 2003 several senior AI directors, including Khan herself, have attended seminars at Harvard Business School in Boston designed specifically to improve the management and strategic planning skills of NGO leaders. The AI staff were not alone: The most recent course, in June 2004, had 65 participants from around 15 NGOs.

One result, Khan reports, was to discover that in many ways NGOs are similar to companies. Both operate the same computer systems, have the same financial reporting obligations and are dealing with assets. According to the AI leader, NGOs and companies should be using "the same hardware, but different software".

Robert Napier, head of the WWF's UK section, agrees. He not only deals regularly with the business community but, as ex-CEO of a major construction company, he is from that community. He says that business-related concerns previously rejected – or at best ignored – by NGOs are now being addressed. For instance, "the WWF symbol, the panda, is a real global brand. This means the 30 WWF sections around the world that use it have to co-ordinate more closely to protect that brand." He adds that a problem one country, for instance concerning a dubious source of funds for a member group, can easily affect the WWF internationally. "My legitimacy is only as strong as the weakest part of the network," says Napier.

About the Author: Hugh Williamson has worked for NGOs in the UK, Germany and Hong Kong. He is currently working as a Berlin correspondent for the Financial Times.