The end of the golden age

Golden sunset (Flickr/blue Mix CC BY 2.0)
Written by Paul Ronalds

The end of the Cold War and the apparent triumph of Western liberalism can be seen to have ushered in a ‘golden age’ for international NGOs (INGOs). They were seen by many as the ‘magic bullet’ for solving global poverty and the ‘favoured child’ of international donors.

This belief in the power of international civil society to do good led to an explosion in the number and size of INGOs, particularly after the end of the Cold War.[1] The growth in resources was quickly accompanied by a commensurate increase in their domestic and international political influence.

The signs are, however, that this unprecedented increase in resources and influence is over: the golden age for INGOs has ended.

Why?

Some of it is a welcome consequence of the progress we have made in reducing global poverty and supporting local communities to help themselves. As countries migrated from low to middle income, politicians and their citizens expect their government to take the lead role in local service delivery and responding to natural disasters. Public servants and politicians in these countries resented the large sums being channelled through INGOs and leaned on donors to provide a greater proportion of humanitarian funding directly to government-run relief efforts.

But there are other, less positive forces at work.

The globalization of political structures, the growth of international institutions and the spread of Western liberal democratic values since the end of World War Two created an environment highly conducive to NGO growth.

This spread of liberal values and international political structures is now in retreat and NGOs face a far more antagonistic political environment, often fuelled by highly sceptical media.

Nationalism and xenophobia are on the rise.

The United Kingdom has voted to leave the European Union, the United States has elected President Donald Trump on an ‘America First’ platform. A recent Demos Report talked about ‘an age of anxiety’ across Europe.

In Australia, the Coalition is scrambling to respond to the growing popularity of Pauline Hanson’s One Nation Party.

Conflicts in Syria, Yemen and elsewhere have seen civilians targeted in flagrant breach of international humanitarian law. Populations are starved and raped as weapons of war. When people manage to flee the horror, they find themselves increasingly unwelcome around the world.

NGO staff and facilities are also being targeted, sometimes intentionally, often recklessly, by state and non-state actors in conflict. Hospitals are destroyed, aid convoys are bombed and aid workers are gang raped and murdered.[2] The number of annual reported kidnappings of aid workers quadrupled between 2002 and 2014.

The war on terror is not only making NGO operations more risky, it is increasingly being used as an excuse to place restrictions on civil society. In 2014, 96 countries took action to limit civil society freedoms of expression, association and peaceful assembly. New pieces of legislation have multiplied around the world – on foreign funding of NGOs, placing restrictions on NGO registration or freedom of association, instituting anti-protest laws and laws that curb advocacy and free speech.

According to the Freedom House Annual Survey, 2016 marked the 11th consecutive year of decline in global freedom.

At the same time, there has been a broad based decline in trust of institutions. NGOs are not immune from this loss of trust. A recent report found global public trust in NGOs has fallen to 53% from a high of 75% in 2001.

Some but not all of this is outside of NGO control.

International NGOs, as a sector, have failed to sufficiently respond to changing stakeholder expectations.

When donors have asked for better evidence of the effectiveness of programming, NGOs have generally been unable to adequately respond. Their public communications on the impact of their operations is not strong enough.

As for-profit operators have muscled in, NGOs have also failed to articulate the ‘value add’ that mission driven, rather than profit driven, organisations provide.

Overall, NGOs have failed to be sufficiently innovative or been prepared to cannibalise their own business model to improve outcomes for beneficiaries fast enough. A group of researchers from leading universities recently argued that “the humanitarian architecture looks remarkably similar to the way it did in the 1950s – only much bigger”. Sara Pantuliano, of the Overseas Development Institute suggested that the lack of reform in the humanitarian sector was due to a failure by the UN and INGOs to give up power and change the way they operate. NGOs’ failure to lead change has resulted in donors imposing it on them.[3]

How should INGOs respond to this harsher operating environment?

They should begin by getting their own houses in order.

This means investing more in capturing and communicating the evidence of the impact of their activities. Not only will this provide donors with greater confidence, it will also be a critical way to combat governments seeking to place greater restrictions on NGOs.

Of course, this will require donors who are willing to pay for improved systems for evidence collection and evaluations.

They must be more prepared to consider different business models and to examine greater collaboration, including through mergers.

There are around 600,000 not-for-profits in Australia, and more than 50,000 charities. There are enormous opportunities for improved efficiency and effectiveness in the sector if CEOs and their boards are prepared to put ego to one side and genuinely consider the benefits of merging with organisations that share a similar mission.

They need to harness the opportunities of new technologies.

International NGOs should also look for ways to make the challenging environment work for them.

For example, as political rhetoric becomes more nationalist, there will be many who will want to find ways to resist it. Through donating, volunteering or campaigning, INGOs can be one vehicle for such resistance.

Interestingly, after years of flatlined public giving, the Australian Council for International Development recently reported 10% growth in giving to INGOs.

Similarly, the global elite know that they must find constructive ways to respond to the rise of nationalism and xenophobia. This can be used to build support for internationally agreed frameworks like the Sustainable Development Goals (SDGs). At this year’s World Economic Forum meeting in Davos, for example, the SDGs were a reference point that framed almost all discussions. There were few participants not wearing the Global Goals badge. The challenge is to turn this symbolic support into concrete actions that help to turn the tide.

The golden age for INGOs is unlikely to return soon. But this changed operating environment should inject a renewed vigour into the sector. The role of making the world a better place for the most marginalised is as important as ever.

Paul Ronalds is CEO of Save the Children Australia and author of The Change Imperative: Creating a Next Generation NGO.


[1] See Ronalds, P. (2010). The Change Imperative: Creating a Next Generation NGO. Kumarian Press, Bloomfield; Ronalds, P. (2013) “Reconceptualising International Aid and Development NGOs”, in Kingsbury, D. Rethinking Development, Palgrave Macmillan, London.

[2] For example, in October 2015, U.S. planes bombed a Medicines Sans Frontiers hospital in Kunduz, Afghanistan, killing 42. In September 2016, a UN aid convoy to Aleppo was bombed killing 20 people, including 12 aid workers. In July 2016, South Sudanese soldiers brutally gang-raped foreign aid workers. In February 2017, six Afghan Red Cross aid workers were killed in an ambush in the country’s north while travelling to a remote area to deliver humanitarian aid.

[3] A good example is the recent, “deliberately disruptive” decision by DFID and ECHO to simplify its cash programming in Lebanon through one, $85 million contractor; see here.

Paul Ronalds

Paul Ronalds is the CEO of Save the Children Australia.

7 Comments

  • The author correctly identified the failings of the INGO sector (e.g. accountability, duplication, etc.) and I would suggest those are valid concerns in an era when few western countries (i.e. traditional sources of INGO funds) appear to be awash with cash.

    Overall, I enjoyed the article, although I disagree with the claimed link to xenophobia.

    Shape up or ship out. That’s an attitude that can be addressed by some of the article’s suggestions. Xenophobia is an irrelevant consideration in my opinion.

  • Very interesting take on the current situation and lot of it applies to Indian context as well. With rising Indian middle class the sector seems to growing, however at the same time International NGOs are facing fund crisis and the reason you have rightly communicated is the ‘Getting own house in order’. Good read. Sharing it within team.

  • NGOs in poor countries serve the prorities of the donor countries and often they benefit the host country but not always. A case in point is energy poverty pitted against the climate change agenda of the SDG. So in cases where a poor country desperately needs to increase fossil fuel emissions, foreign funded NGOs are preaching climate change and renewable energy and so in. These NGOs are serving their own financial needs and not the needs of the people. There is a gross disconnect here between the values and priorities of donors and those of the host country.
    https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2812034

  • Hear, hear Paul. INGOs (who do great work as a general rule!) have done little in recent decades to engage funders, the public and policy-makers in genuine dialogue about the impact of their work and how it might be enhanced. Instead, “success” is still frequently measured in fundraising growth and similar non-impact measures. We estimate $120-150billion a year is generated by a sector which continues to define itself by what it isn’t! (Not-for-profit). The good news is that increasingly we are seeing the emergence of real efforts to become a true “for-purpose” sector. One that is characterised by transparency of impact and an equal-footing dialogue with funders and policy-makers in creating the necessary changes to lives, and the system in which those lives can be allowed to flourish. With the tragic decline in humanitarian values in national leadership, it is more imperative than ever that a strong voice arises from the humanitarian sectors, to speak loudly, and with rigour, to redefine what “prosperity” and “progress” mean to all of society, not just the wealthy.

  • Paul you may want to look at this paper which Andrew Hewett and I wrote in 2013 which had a similar title to this blog. We suggested eight things (listed below) International NGOs might want to consider it they want to remain relevant. There are some interesting overlaps and differences of emphasis with what you are suggesting.

    1. INGOs should clarify their identities and present themselves and indeed act as vehicles for social change and social justice, and should no longer present themselves as aid organisations.
    .
    2. INGOs should focus their development programming on challenging unequal power relations and the political, economic and social processes that drive these.

    3. More INGOs should ask themselves if they should cease direct service delivery programming, especially in middle income countries

    4. INGOs should also focus on building connections between their supporters in their home countries and communities and their organisations in developing countries.

    5. INGOs should aim to ‘bring it all home’ recognising the porous boundaries of global social justice concerns.

    6. INGOs should have clear guidelines for their relationship with ODA agencies including being clear about their response to the conditions that come with funding.

    7. INGOs need to transform their organisational structures and ways of working to emphasize nimbleness and flexibility

    8. INGOs could begin a more coherent and focussed discussion on whether institutional growth is necessary for INGOs to be effective vehicles for social justice

    • Thanks Chris.

      I suspect its not the lack of awareness of the need for change that is holding the sector back nor the form the change needs to take (although we might disagree on some of the detail), but the ability to lead impactful change agendas within INGOs.

      Many INGOs have diffuse global governance structures and a plethora of stakeholders that make negotiating change difficult. Freeing up resources to invest in new approaches is fiendishly difficult when there are so many competing demands. And there is an overwhelming lack of capacity to manage these complex change processes inside INGOs.

  • Enjoyed this article.
    So agree with your comment: “There are enormous opportunities for improved efficiency and effectiveness in the sector if CEOs and their boards are prepared to put ego to one side and genuinely consider the benefits of merging with organisations that share a similar mission.”
    Mergers and territory sharing aside (both good by the way), there also needs to be a meaningful examination of the quality of outputs and their actual, rather than assumed, contribution to stated outcomes.
    I have witnessed incredibly shoddy project outputs from INGOs on the ground. It is not enough to simply state that ‘not for profit’ must automatically mean ‘more cost efficient’ – if the outputs are poor then any supposed savings become meaningless.
    Global politics aside, it may also be that INGOs have lost some local support due to confusion between their sometimes simultaneous roles (eg advocate or contractor?). Let us not forget the obvious clangers such as World Vision in Israel with the apparent diversion of more than $40 million in donor funds to terrorist groups.
    Room for improvement indeed as is the case at the end of any golden age. Your article points the way for some opportunites for much needed reinvention in the sector.

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