I don’t need to list endless facts about poverty in India. We know there’s a problem. The scale of the problem is so vast the state cannot tackle them alone. Key to poverty alleviation are NGOs, but what is the current state of NGOs in India?
You might be forgiven for thinking there are too few NGOs in India. To the contrary, according to the CBI, there are MANY. In fact there is 1 NGO in existence for every 400 people (that’s 3,000,000 NGOs). However, from preliminary research across the web and personal experience, there seems to be a lack of accountability and regulation amongst NGOs. Due to this, finding credible NGOs is a difficult process. The Companies Act of 2012 requires corporations with turnover exceeding ~£100M to spend 2% of profits on Corporate Social Responsibility (CSR). Thus, it is estimated 8000 companies will qualify for CSR investments. However, an information gap between NGOs and Corporates due to the lack of regulation, accountability and possibly the lack of scale means a considerable % of the CSR funds remain idle. This is an enormous untapped resource.
Whilst India has the highest number of NGOs of any country, it’s charitable donation levels fall below the global average. Efforts are being taken across the country to increase philanthropy. However, it appears there are three key areas that NGOs must still focus on:
Highlighting the outcome of donations and the quality of work being carried out by the NGO is paramount to this. Frequent communication between donors and potential donors will help achieve this. According to the Bain’s Report (2013) on Indian Philanthropy, just over half of the NGOs surveyed were found to communicate infrequently.
Establishing Good Governance procedures
A framework detailing charitable objectives, trustees and financial reports/audits would go a long way in enhancing the donor-NGO relationship. It would also help if NGOs had board members preventing the mismanagement of resources and guiding future activities.
Many Indian NGOs are unable to scale in terms of IT, social media, tv/radio and print advertising. This limited technological capacity makes NGOs difficult to discover and communicate with. This may be due to reasons of cost or because the importance of technology is underestimated. With more and more of India’s youth becoming web literate it’s critical to engage with this generation on the correct platforms in the correct manner.
“Indian donors also tend to prefer direct interventions designed to help beneficiaries immediately, as opposed to more indirect interventions that seek to build organizational capacity at scale.” However, scale must not be underestimated and its importance should be emphasized.
On the whole, poverty in India has been improving every year, but there is a long and difficult road ahead. CSR is likely to provide a much-needed kickstart but NGOs must work towards improving the aforementioned areas. Husti will turn 6 months old on January 5th and we are working hard to improve on all these aspects by:
- Fulfilling the criteria for registration by December 2015 and registering with the Charity Commission.
- Building a board of knowledgable trustees
- Developing the web platform
Thanks for reading!