NGOs do not have a single type of relationship with business. Some NGOs have very close ties to business or have been specially created by companies or business associations – such as the powerful International Chamber of Commerce or the influential Business Council on Sustainable Development. Other NGOs have mixed attitudes, partly critical, partly not. While still other NGOs tend to systematically differ from business firms in their views of the world and their sense of international priorities. Big companies increasingly seek to have "dialogue" with critical NGOs and to coopt them through grants, "partnerships," "multi-stakeholder dialogues and other means. While leading public relations firms pioneer ever-new forms of "proactive" business policies towards NGOs, global justice movement NGOs pioneer ever-new forms of criticism and public accountability for private firms.
GPF's Jason Garred presents a general introduction to NGOs, and then looks at how NGOs can influence the murky world of transnational finance.
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NGOs have been at the forefront of the fight against the Keystone XL tar sands project. In response, TransCanada has issued a series of lawsuits against these groups. Filing what are called “Strategic Lawsuit Against Public Participation” (SLAPP), multinational companies can take action against non-violent protests by targeting financially-weak NGOs and individual protestors. One attorney representing the activists condemns the lawsuits as an unethical violation of freedom of speech. Ironically, what activists have labeled “corporate bullying” has not deterred the coalition movement against the project. (Common Dreams)
Oxfam has partnered with Unilever to improve the livelihoods of smallholder farmers in Tanzania and Azerbaijan. NGO and private sector partnerships can be mutually beneficial— businesses benefit from sustainable development by strengthening their supply chain and their public image, while NGOs benefit from technical and financial assistance. However, Oxfam is cautious not to turn the partnership into a plantation building scheme. Oxfam independently monitors corporate social responsibility and only partners with companies with their core business working to make a difference. (Guardian)
Private foundations are becoming increasingly involved in providing aid and investing in foreign development projects. In 2009, global private philanthropy was $53 bn, and official government development assistance was $120bn. While private foundations often have an efficient method of raising money and delivering aid, they lack transparency and accountability. (Guardian)
This IRIN article examines the relationship between development and private companies. Some development NGOs encourage private partnerships, arguing that corporations’ assistance ensures that they will have both funding and the support to achieve their development goals. However, these private development partnerships are fundamentally flawed since private organizations have no stated obligation to protect human rights and more, often than not, only fund and support projects that fulfill their business interests. (IPS Terraviva)
There is a growing trend among NGOs to adopt a business model in the hopes of improving the delivery of humanitarian assistance. Business-like practices include streamlining costs, improving efficiency and attracting highly skilled workers. This Guardian article discusses this new trend and points out that while it is important for NGOs to improve the mechanism by which they deliver aid, the pursuit for efficiency must not compromise the overall mission of NGOs. (Guardian)
The UK will now use aid money to directly fund 300,000 companies in poorer countries in order to open up trading opportunities in the developing world. With other countries, like the US, increasingly using the private sector to deliver aid, it is important to acknowledge that businesses are often “engine(s) of exploitation” and do not guarantee assistance or profit for the developing countries. It is necessary to hold businesses accountable for their actions and systematically evaluate whether or not these projects are actually delivering humanitarian assistance or merely furthering the interests of the donor countries. (Guardian)
This report released by the Council of Canadians condemns increased corporate influence on UN water policy. The timing of the report is important as water was only recognized as a human right last year, and the UN is still determining the limits of corporate involvement. While the report does not oppose corporate involvement in ensuring sustainable water protection policies, it warns that the UN should be aware of the “imbalance in power, influence, and money” that comes from allowing corporate lobbying. (The Council of Canadians)
The Seub Nakhasatien Foundation, a prominent Thai environmental NGO, has accepted 25.89 million baht - approx 851,000 USD - from the energy company Petroleum Authority of Thailand (PTT). In the 1990s, the Foundation campaigned against a gas pipeline built by PTT through the Huay Kayeng forest reserve. By accepting sponsorship from PTT, the Foundation exposes itself to the firm's influence. Regardless of whether PTT exercises actual influence over the Foundation's environmental agenda, the appearance that it does is enough to damage the NGO's credibility. (Bangkok Post)
The Obama administration is looking to private firms to assist in the fight against world hunger. US development agencies are proposing efforts that would incentivize aid to attract private sector actors. Traditionally, aid is given to governments or civil society organizations. The administration believes that the "profit motive" can be leveraged to make projects more sustainable. Yet this argument fails to consider places where projects are desperately needed but aren't profitable. Moreover, US transnational firms like Cargill stand to benefit the most from these arrangements. (Voice of America)
This Christian Monitor article analyzes the potential impact of Giving Pledge, an initiative by Bill Gates and Warren Buffett to donate billions of dollars to charity and getting other billionaires to follow suit. While the money raised can potentially alleviate many of the world’s basic problems, especially while governments are cutting back funds, it is still important to critically examine how the billionaires got their money, and the increasing collusion between corporations and NGOs/philanthropy.
The recently launched PMD Pro is a new qualification which offers web-based project management training to managers of development NGOs. This certification - based on “tools proven effective in the business world” – claims to improve management. While it has so far received favorable responses from organizations such as Oxfam, the author of this article remains unconvinced. Are additional credentials necessary for NGO professionals? Should scarce NGO resources – time, funding and personnel – be spent on this? This seems to reflect a worrying trend towards the “businessification” of NGOs. (Guardian)
According to Ann Wright, US Army veteran and former US diplomat, it is our responsibility as consumers to convince companies that peace is more profitable than war. The Israeli cosmetics company Ahava is making money off war by exploiting occupied natural resources from the Dead Sea. Whereas the Japanese company Leila donates one yen to the Women's Peace Fund for every cosmetic product sold. Consumers must therefore be conscious when choosing which products to buy. (CommonDreams)
The growing partnerships between NGOs and corporations may lead to a conflict of interest for NGOs and their role as corporate watchdogs. This report argues that Canadian NGOs feel forced to have closer relationships with the corporate sector, due to a decline in government funding and a more competitive fundraising environment. These partnerships raise questions of NGO legitimacy and independence. (National)
This UN Foundation – Vodaphone Group Foundation Partnership paper publicizes a public-private initiative to sell mobile technology to poorer nations, and argues that "telecommunications can be a powerful tool for positive change in the world." Yet empirical evidence in the report fails to show that mobile initiatives achieve development goals. NGOs in healthcare studies gathered data with mobile phones, but could rarely use the information in the field because they lacked technology for data storage and analysis. The case studies also focused on small mobile networks, which the authors acknowledged rarely reach the poorest areas. The report peppers the research with success stories of mobile initiatives in rich countries, like text message sex education in the UK. (UN Foundation – Vodaphone Group Foundation Partnership)
Supporters of the UN Global Compact argue the UN should cooperate with the private sector in order to promote corporate social responsibility. However, the UN Global Compact lacks a monitoring process and no binding measures have been taken since the start in 2000. By 2006, less than 60 percent of the corporations reported to have taken action to comply with the ten guiding principles on human rights, labor, anticorruption and environment. Critics argue that companies use the UN Global Compact as a tool to improve their image by being associated with the UN, without being required to take action. (Covalence Analyst Papers)
The author of this Ethical Corporation piece argues that NGOs should not blame multinational firms for human rights violations but instead seek accountability from states. However, such an argument overlooks how big companies sometimes push governments for "favorable deals" that further corporate interests. NGOs demand that UN Special Representative on Business and Human Rights John Ruggie call for "universally recognized standards and effective accountability mechanisms" in his final report. (Ethical Corporation)
Coca-Cola's expansion in India meets fierce resistance by activists inside and outside the country, who accuse the corporatio,n of damaging both the population's health and the environment with pesticides, pollution, waste disposal and excessive water use. While big companies such as Coca-Cola seek dialogue with NGOs to aid public relations campaigns, activists reproach them for not looking beyond their profit-motive which keeps them from making concrete efforts in the safeguarding of human welfare and the environment. (Wall Street Journal)
Though big businesses shunned activists in the 1990s as little more than a nuisance, NGOs have been highly successful in improving their own trustworthy image while pressuring large organizations to open meetings, release documents and monitor social and environmental affects of their actions. The Los Angeles Times points to the Internet, better fundraising, alternative ideas and activists' participation in World Trade Organization discussions and the Davos World Economic Forum as reasons for the rising status of NGOs. (Los Angeles Times)
As poverty reduction and climate change gained more attention at this year's World Economic Forum, Sir Digby Jones, the head of Britain's leading employers' organization, accuses NGOs of "hijacking" the venue. Instead of holding businesses accountable, he would prefer the forum to celebrate "risk takers and wealth creators." (Guardian)
Partnerships between NGOs and business are both attractive and bear dangers for the parties involved. Citing successful examples, the article argues that a deeper relationship can bring credibility to the businesses and give NGOs the chance to challenge and change business practices. (Ethical Corporation)
The Christian Science Monitor says that the Global Exchange, an international human rights organization, and Starbucks "work together to make 'fair trade' a reality." However, increased engagement with business could turn internationally credible NGOs watchdogs into "lapdogs."
This report, supported by a wide consortium of NGOs, focuses on the role of NGOs in civilizing capitalism through market-oriented activities. (SustainAbility)
The radical change in markets required to address sustainable development blends NGOs with businesses, mixing civil society values with private sector tactics. (SustainAbility)
Business professionals help under-funded non-profits by taking pay cuts and devoting their skills to philanthropy. (Christian Science Monitor)
Ralph Nader argues AEI's criticism of NGOs as a threat to the constitutional democracy is unfounded. In fact, advocacy work and monitoring governments' and businesses' performance are fundamental to the democratic process. (CommonDreams)
The American Enterprise Institute denounced NGOs for their "liberal internationalist" vision and attempts to "constrain the US." One professor even described NGOs as a "Stalinist concept." (Foreign Policy in Focus)
American Enterprise Institute declares NGOs a threat to US sovereignty and free-market capitalism. "NGOs have created their own rules and regulations and demanded that governments and corporations abide by those rules." (OneWorld)