International aid charities need to be more honest in how they communicate and be braver and more disruptive in their approaches, sector leaders said this week.
At the launch of Disberse, an organisation which plans to use blockchain technology to help international development charities to transfer funds between countries, representatives from United Purpose, the UK Aid Network, Transparency International and Charities Aid Foundation discussed the challenges around trust and transparency facing the sector.
Kathryn Llewellyn, global chief executive of United Purpose, previously Concern Universal, said: “It is a good time for us as a sector to be discussing this. It is more and more important that we as a sector are owning that debate about transparency and accountability.”
Government spending on international aid and development, and the organisations that deliver it, has been highly scrutinised in some sections of the national media in recent weeks.
Llewellyn said that “we have taken a bit of a bashing as a sector” and that “we have got to be open” about the impact it could have on fundraising.
She called for the sector to “be a bit braver” and said “we haven’t been disruptive enough” in approaching challenges.
Be more honest with donors
Amy Dodd, director of the UK Aid Network, added: “Development spending and overseas aid is going to be a hard sell, particularly when things are a bit more difficult back home.”
She described the “mismatch” between public perception of aid charities and what they actually do as a challenge.
Dodd said that communications often focused too much on things like the number of bed nets a donation provides, at the expense of talking about the other infrastructure building work that charities do.
She said: “We’re not necessarily entirely honest about how we do that [help people]. We spend a lot of money on things like education – we don’t spend all our money on direct delivery.”
Challenge for all charities
Rhodri Davies, head of the Giving Thought programme at CAF, said there was a wider challenge for the whole voluntary sector around “misconceptions” and warned that making aid more transparent wouldn’t necessarily lead to an increase in donations.
He said that as it stands some donors would insist that all their donation goes to the front line, so there are “some nuances to work through”.
“We have to be careful in suggesting that blockchain can solve all the challenges – there’s a danger in saviour complex about new technology,” he said, adding that "there is a question about whether giving individual donors more information will actually encourage more donations”.
He said that the “growing disconnect between the fundraising and operational side” sides of charities needs to be addressed, as “it is exacerbating the challenge of having a more meaningful conversation with donors”.
Sector needs to address misappropriation of funds
Using blockchain technology, Disberse aims to help aid charities distribute funds more efficiently and to track them better. It plans to start pilot programmes this spring.
Ben Joakim, chief executive and co-founder of Disberse, said: “The mismanagement and misappropriation of funds is an unfortunate reality that the sector has to address, yet many of these issues are caused by systemic inefficiencies.”
He added that the sector is at a “crossroads” where it needs to be more “accountable to donors, agencies and the people it serves”.
Peter Van Veen, programme director, Transparency International UK, said: “This is part of a wider discussion of accountability. As a donor you need to know where that money is going.”
But he said this places pressures on organisations trying to track funds, with funders like the Department for International Development asking for higher accountability.
“Some NGOs that work closely with corporates are already getting good at better reporting back and being more transparent.”