Achieving good governance often feels mythical: a series of Herculean tasks which we strive for but never quite seem to achieve.
Inyathelo: The South African Institute for Advancement’s recently published Voluntary Code of Governance and Values for Nonprofits in South Africa is excellent, but I argue that we need more.
The compliance rate of registered nonprofits to the Department of Social Development’s (DSD) mild standards of governance is well-known; 80 percent of nonprofits fail to submit a narrative of activities and audited financial statements annually in South Africa.
So, it is a logical step to assume that what we’re doing is not enough. Even if you are part of the golden 20 percent who do comply.
So, the sceptic in me says that unless the Inyathelo Code is picked up by donors who insist on their genuine application, I think it is unlikely that nonprofits are going to apply the rules. Why?
We have proven that self-regulation and voluntary application are not strong enough structures for accountability.
Just like business in those early days of the King Codes, the nonprofit sector requires a framework which forces it to comply and apply good practice. I appreciate that this brings up the spectre of policing the sector, and of heavy handed, authoritarian oversight. But we have proven that self-regulation does not work.
There are a few issues which I believe merit debate:
Firstly, I strongly believe that we need an independent body to regulate and monitor the work of the nonprofit sector. Not only will this raise the calibre of our work and set standards for implementation, but I believe it will force us to be more accountable. The proof is in the action: lay a complaint against a nonprofit with our current gatekeepers - DSD - and see what happens.
It is also not feasible to have DSD; one of the biggest funders of social services, as the enforcer. It is a conflict which does not encourage reporting of poor behaviour and interferes with the delicate relationship between donor and nonprofit. Which is also why we do not want our implementation of the Inyathelo Codes to be donor-driven.
Instead civil society needs to actively demonstrate its commitment to good governance and a value-driven approach and lobby for an independent body to regulate and administer it.
An independent regulatory body, like the Charities Commission in England and Wales, will substantially change the environment within which we work, ensuring that standards are set and met. This will help build trust in the sector and improve understanding of the work that is done. Understanding charity will move from the outdated Victorian concept where it is all about being seen to do good, to one where service delivery is understood over the long-term, financially supported and measured by need, response and impact.
It will counteract the current reality where the morality of nonprofits is assumed to one where that morality is demonstrated.
Secondly, I agree with the argument that King III is not applicable to the nonprofit sector as it is written from a corporate standpoint and something as basic as the language excludes our structures and nonprofit approach. But do we really want separate Codes of accountability? Are we that different from the for-profit sector? In the short-term, yes.
But I believe that the bridge between profits and not-for-profits must be built if we are to move forward in a sustainable and practical manner. A more partnered approach and better understanding is what will bring long-term gain. It is important to have written our own Codes so that we clearly know where we stand. But we must be weary that this is not the start of a separate channel of ethics and accountability. Rather, we should use these Codes as the point to begin or continue the discussion for an integrated Code of Good Practice that holds both for and not-for-profits to account.
In summary, the Inyathelo Codes should be a catalyst, a springboard which we use to engage in active dialogue with King III, business and with ourselves to lobby for an independent body to which we will be accountable and which will also hold us to account.
Inyathelo engaged all of us in consultation and demonstrated how if we take the initiative in setting our own standards, we could build our own accountability.
It is imperative that we take advantage of the momentum to set up structures that hold us accountable and embed the integrity of the nonprofit sector. It is on these foundations that we will entrench a strong, active civil society that delivers excellent services and carries integrity.
A Herculean task?
History proves these are not insurmountable.
- Kerryn Krige is the former Director of Communications and Income Development at Child Welfare South Africa. She has over 10 years experience in the nonprofit sector working for large NGOs in the United Kingdom and South Africa. She is passionate about building a stable civil society by strengthening the performance of nonprofits. To contact her, e-mail to email@example.com. Alternatively, refer to ayandamalindimedia.yolasite.com.