There has been a lot of talk about corruption and lack of transparency in the media lately.
George Packers latest piece ‘A Dirty Business’ in the New Yorker is a fascinating read into inside trading on Wall Street. In China, the distrust of government run charities bubbled to the surface last month with the China Red Cross scandal. CSR Asia China Director, Brian Ho, this week also discussed the embezzlement of money from local NGOs in China.
Corruption is a tricky business. In many countries it is embedded in daily life and culture. In India and to a less extend China it can be almost impossible to do business without coming up against corruption. India ranks 87 out of 178 in the 2010 Corruption Perception Index while China ranks 78, a good indication of how significant corruption is in two of the most powerful countries in the world.
Combating corruption is complicated by the fact it is often embedded in culture. Therefore it is important to understand that your cultural worldview of corruption can be very different depending on where you’re from. In Australia if your brother asks you to give his lazy son a job as head of marketing you will most likely just say no, or otherwise direct him to the formal HR channels and maybe get him an interview. But in China, you are often tied to your guanxi (关系), your family and personal network that looks after you and who you look after in return. To refuse your brother’s son a job no matter how lazy or unsuited he is may not be an option.
The call for more transparency in how GONGOs (Government-Organised Non-Governmental Organisation) or non-profit organisations (NPOs) in countries like China should operate needs immediate attention, as there are a lot of great organisations that will suffer at the hands of the big bad eggs. But as with any other significant global issue nothing is ever simple. One related issue that feeds into lack of transparency and therefore corruption is the lack of capacity and knowledge about monitoring and evaluation (M&A), or in non-development speak, demonstrating you are doing a good job.
From personal experience in countries such as China and Laos, the culture of monitoring and evaluating almost doesn’t exist. During my time in Laos I spent numerous hours with local government staff explaining what a baseline survey was and why it was important to measure our project’s impact. The common response was that projects wouldn’t go ahead if they weren’t going to be beneficial, why should we waste time measuring them?
The lack of general capacity to run NGOs in a country like China is also another reason M & A hasn’t developed. Staff are often over worked and have limited basic administration skills such as managing finances, generating project plans and writing reports. Considering this and the limited importance placed on transparency and evaluation it is no wonder corruption exists.
If countries like China and Laos want a healthy NGO industry (which they do as NGOs provide a huge social safety net the government can’t provide) they need to work from the bottom up by insisting on increased transparency and monitoring and evaluation. A tall order no doubt, but if something isn’t done the deep pockets of philanthropists might just dry up.