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Finance conference addresses accountability

By David Ainsworth, Third Sector Online, 9 May 2008

Charities should appoint someone at board level to handle transparency, the annual Charity Finance Directors' Group conference heard.

Accountability to stakeholders was the main theme of the event in London, which was attended by hundreds of finance professionals.

Michael Hammer, executive director of the One World Trust, said his organisation had each year carried out a survey of 30 international bodies, which found that charities were lagging behind multinationals in terms of their complaints procedures and behind inter-governmental organisations in terms of transparency.

Speaking at the conference on 8 May, he said charities should be careful to avoid “multiple accountability disorder” when trying to reconcile their separate responsibilities to donors, beneficiaries, government, employees, the public and one another. He said appointing someone at board level with a specific remit for transparency would help organisations tackle the problem.

“Charities need to have consistent complaints procedures whose workings are known to everyone, not just to people inside the organisation,” he said.

“There should be an understanding of the process, what happens if your complaint is upheld and what right of appeal there is.

“I think the most important thing for charities is that they don’t rest on their laurels as doers of good. It’s not enough to do good – you have to do it in a good way.”

Stuart Etherington, chief executive of umbrella body the NCVO, said that charities needed to educate stakeholders, particularly donors, about the need to spend money on good administration.

“Donors are reluctant to see their money go on procedures,” he said. “Charities often have to guarantee that a high enough percentage of donors' money goes to the beneficiaries.

“This means there isn’t a lot of money for internal procedures. Maybe we need to show our donors that we need to spend this money, and that spending it now will allow us to do a better job in the long run.”