Global Policy Forum

Forming a Donor monitor NGO


By David Lempert

Policy Innovations
January 16, 2008

Money stuffed in envelopes for government officials. Gifts of cars, computers, and overseas junkets. Pressures to falsify reports and hide information from public oversight. Destruction of minority communities, cultural heritage, and the environment for productivity and profit.

It sounds like the criticism typically leveled at corrupt multinational corporations or military juntas in the developing world. But these behaviors are actually common practice in the international development community, where the careers and self-interest of donors and their cronies comes first, and the peoples of the developing world are treated as little more than a means to private ends. It occurs with your tax dollars and mine, and with funds attracted through appeals to our humanity and generosity-funds intended to stop these very same problems. Though much of this behavior could be considered criminal-in violation of international treaties, country constitutions and laws, and existing codes of professional ethics-few instances are ever prosecuted and almost all of it is conducted with no public oversight. Attempts to report or reverse it are often career-ending for anyone in the field.

The practices listed above occur in the UN system, international banks, donor countries, NGOs, and missionary organizations, and they have persisted and possibly worsened during the 20-plus years I have spent as an international development consultant. A standard critique of international aid is still true today-that it is designed to serve the short-term interests of donor countries and that the agenda is one of dependency and neocolonialism, promoting international trade rather than stability.

Meanwhile, an understanding has emerged that protecting natural environments, creating stable and competitive economies, and promoting diversity, rights, and local cultures are all appropriate goals of development. Thus many NGOs do put the interests of the people in recipient countries first. But the reality is that their incentive schemes undermine what they intend to accomplish. What goes wrong in international development assistance is not the amounts of the aid or the conditions attached to it-the standard debate between North and South. The heart of the problem is one of management incentives for the international actors that provide assistance. The solution is as much a managerial or administrative problem as it is one about empathy. It is about finding a way to change the incentives in organizations that lack the checks and balances one finds in business, in other areas of government, or in domestic NGOs. Given that there is almost no real direct accountability for any of the international development agents, either to their beneficiaries or to the international public, change is not going to come from within the organizations themselves. It needs to come from without, through new kinds of monitoring. Donor Monitors could regulate the development industry and its standards in each donor country and also monitor overall impacts for the recipients.

Up until now, development assistance has been viewed as an industry that either does not need any professionalism or that is too diverse in professional disciplines to fit any one standard. But the ethical obligations and public administration concerns are common across professions. Issues of accountability, transparency, reporting, and obligations to both the funders and the beneficiary communities can be codified and professionalized through the work of a development monitor NGO.

It seems that the only general standards of development in use today are those promoted by the World Bank and the UN system-for annual income increases (Gross National Product) and for short-term poverty reduction (really, postponement). Neither of these measures captures the real goals of development-cultural sustainability, protection of biodiversity and cultural diversity, and gains in wealth and happiness on a per capita basis rather than an aggregate basis. Nor is there any organization regularly measuring the negative impacts caused by development, or attributing them to the projects of individual development actors. Development interventions too often have negative impacts on political inequality (since development "partners" are usually elites), income inequality, dependency, and other measurable areas. Global taxpayers and contributors need this information from a source they can rely on, and this is also a perfect role for a development monitor NGO.

A strong independent monitoring organization that can use the international leverage of the press or the courts to sanction or pressure individuals and organizations in the development field could have a major impact on regulating development contracts, professional codes, methodology and standards, and benchmarks and indicators. This role would promote both professionalism and accountability. What are needed are clear models of contracts and whistleblower procedures, systematization of procedures, and collections of information that rate and expose those who do not live up to them.

While international donors continually call for more transparency among poor-country governments, their own contracts and accounting practices should be on file for full public review on every project, with monitors pushing the process toward detailed line items, so that everyone can see where the money really goes and why. Improved professional codes also would be useful. If lawyers can be disbarred in the United States for failing to protect the interests of a single client, why is it that this principle does not apply when a development expert supports the violation of cultural or land rights or other community interests during a development project? The answer is that there is currently no monitoring and there are no sanctions, but there could be.

Ten years ago, after constantly facing pressures to violate laws or to override professional codes and ethical obligations to beneficiaries, I redrafted my various professional codes to apply them to development work. I published these ethics codes in professional journals in three disciplines. Codes can and do improve professionalism, and Transparency International has promoted them for business and government in the developing world. A Donor Monitor NGO needs to perform the same function for development professionals. Simply standardizing some very basic procedures in development analysis would help to eliminate a large number of wasteful or corrupt projects. Requiring organizations to follow through with commitments and checking their analysis and compliance would establish a quality seal that would help contributors distinguish between real and useful projects and fraudulent or wasteful ones.

The reason development projects continually reinvent the wheel, and seek money for it each time they do, is because there is no systematization of information that establishes ideas in the public domain and details their comparative costs and results. Many development agents currently have no idea how to conduct a cost-benefit analysis or project appraisal and have no idea what an accounting system that allowed for comparative measurements would even look like. Inputs are given with no idea what a standard output should look like, or without understanding the different modalities of offering assistance (whether a loan, a subsidy, or a gift is appropriate, and why). Lester Brown of the Earth Policy Institute and Worldwatch began the series of annual State of the World books in the 1970s, monitoring global resources, population, and several other indicators for humanity. These kinds of annual public indicators, conducted for each country and applied to the activities of development projects, reflect the kind of monitoring that beneficiaries and contributors need on development projects. A Donor Monitor NGO would monitor development agents on three levels: their global impact, their national impact, and their overall professional quality. As this initiative strengthens, it can work to establish standards on particular types of project interventions and to offer quality ratings in a kind of Consumer Reports of development assistance. Whether by donor or by level of specificity of project, such ratings could be used to inform the public where they should make their contributions and where they should exert pressure for change, as well as to open avenues of scrutiny for the media.

In some poor countries, this is now impossible to do inside the country since governments prevent any monitoring of their own policies. This is why monitors are especially needed. In fact, development actors need to establish such monitoring as a condition of assistance, and outside monitors must pressure them to do it. The appeal of governance and accountability organizations like Transparency International or the Government Accountability Project is relatively new, as are other information and monitoring agents such as Consumer Reports, Common Cause, and Public Interest Research Groups. Monitoring donors is simply one of the next steps needed to continue this trend of professional standard setting and public monitoring.

The incentives and the funds are available for such an effort in the development field. Public and individual donors to charities have an interest in seeing that donations actually solve problems rather than postpone them or generate harms that will cost much more to solve in the future. Innovative NGOs and qualified professionals have an incentive to demonstrate that their solutions bring results and are the ones that deserve to be funded. Citizens of recipient countries have incentives to ensure that the aid money they receive is really in their long-term interests. Students entering the development field have an incentive to apply their skills and to see what results current practitioners actually bring. The only thing missing is a way to organize these interests and funds. To start that effort, I outline some of the types of measures in a longer version of this piece. I write this article in the hope of enticing existing NGOs to expand their missions into this area and to invite others to develop new NGOs and seek available funds. Given the multiples of current waste in development spending, it should be easy to demonstrate to citizen and public donors that good measurements and advocacy can save much more than it would cost to do this kind of work.

More Information on NGOs
More Information on Credibility and Legitimacy of NGOs
More Information on Funding for NGOs


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