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Self-Certification for Voluntary Organizations

Written by: Mohd. Ali Faraz, Voluntary Action Network India (VANI), Progam Officer

The Voluntary Sector in India is passing through very challenging times. On the one hand, there is a high demand from Voluntary Organization’s (VOs) due to socio- economic realities at grass roots level, and changes in resource availability. On the other hand, there have been numerous changes in the laws as well as its interpretations by the enforcement agencies. Questions are also being asked about the accountability and transparency within the sector. The image of the sector plays very important role in how people in the society think of us. In addition to strengthening internal structures and operations, self-regulation can help build public trust in the sector.

The self-certification model is required as a response to increasing pressure and scrutiny of the quality and legitimacy of VOs from donors, beneficiaries, the media and government. It is an expression of commitment of voluntary organizations to uphold the highest standards of professional conduct and accountability.

Apart from the self-certification model, there are two more major forms of certification: accreditation and peer-certification. In case of accreditation, there is an independent third party that provides a “stamp of proof or ‘seal of approval’ that the VO complies with the requirements set forth in the accreditation system. Usually there is a rigorous assessment process and the organization getting accredited needs to pay money for the process. This form of certification ensures the highest level of compliance, that is, it can be trusted that organizations with such a seal or accreditation are truly compliant with the self-imposed regulations. In essence, accreditation is a form of, or another name for third-party certification.

However, accreditation provided by organizations like Give India, Credibility Alliance and CAF India lacks universal acceptability. Currently, there are no mechanisms of accreditation which are verified and accepted by the Government of India.

The next level of compliance is peer-certification, when the members of a network or other membership organizations verify compliance of their fellow organizations. This is usually done on a voluntary basis for ex: an elected certification committee and with fewer resources like no payment involved, or it is paid for as part of the membership fee. This is sometimes called self-certification, referring to the “in-house” nature of the assessment, but that is somewhat misleading since there is a third party involved. Also, this third party (the other peer/s) is not fully independent, they belong to the same network organization and there are competing interests at play. For instance, to maintain the good image of the organization as a whole, or to keep the members happy. Self-regulation may also seek to fill gaps in government regulation and protect civil society from burdensome and inappropriate government intervention.

The absence of culture of internal governance and management system in the voluntary sector has reduced transparency and accountability of these organizations in the eyes of the government, new donors and even public. CSO development effectiveness speaks to the impact of CSO actions for development. These actions for development will be effective if they bring about sustainable change that addresses the causes, as well as the symptoms, of poverty, inequality and marginalization. For CSOs, development effectiveness is linked to multi-faceted human and social development processes directly involving and empowering people living in poverty and discriminated and marginalized populations. CSOs assume no single development model, but rather focus on people and their organizations, empowering them to make choices over how they will develop. For CSOs, development effectiveness requires openness to many development alternatives, which are increasingly informed by human rights, environmental sustainability and opportunity for all.

VANI organized various meetings and workshops at different regions of India and involving stakeholders, experts and social activists asking for their view and suggestion also to acknowledge the outcomes of Open Forum process and endorse the Self Certification Principles as an essential basis for their policies of engagement and support of civil society in development. Civil society organizations are a vibrant and essential feature in the democratic life of countries across the globe. CSOs collaborate with the full diversity of people and promote their rights.

The essential characteristics of CSOs as distinct development actors – that they are voluntary, diverse, non-partisan, autonomous, non-violent, working and collaborating for change – are the foundation for the Self-Certification of CSOs. These principles guide the work and practices of civil society organizations in both peaceful and conflict situations, in different areas of work from grassroots to policy advocacy, and in a continuum from humanitarian emergencies to long-term development.

Principle I: Organizational Commitment Standards

Each organization should have a written standard of conduct for its directors, employees, and volunteers. The organization’s activities should be open and accessible to scrutiny by its donors, beneficiaries and other stakeholders (except for personnel matters and proprietary information). Organization should have a copy of annual report, financial report and its activities’ reports, which is known to all the people associated with the organization and shared with the public.
Availability of organization’s registration documents (Society Registration Certificate/Trust Deed/Certificate of incorporation), Foreign Contribution Regulation Act (FCRA) certificate [if registered with Ministry of Home Affairs (MHA)], 12A and 80G certificate (if exempted from tax) is an important indicator of organization’s commitment to reporting and complying with legal reporting and registration standards.

Principle II: Governance and Administrative Standards

A) Role and responsibility of the Board
Each organization should have an independent, active, and informed Board, selected based on merit and skills. The organization should have policies which specify the frequency of Board meetings (at least two per year) and adequate attendance by directors (at least a majority, on average). Not more than one member of the governing board should be a paid staff person of the organization and no paid staff person should serve as a board chair or treasurer. The Board may designate an Executive Committee, define its role and review its reports. The Board should have policies restricting the number of employees who are voting members of the Board; providing limits for directors being related to one another, the Founder, or the Executive Director; and establishing limited terms of service for directors and officers.
B) Management and Human Resources
Organizations should follow sound management and business practices appropriate to its mission, operations, and governance structure. They should have clear, well-defined, written policies and procedures relating to its employees and volunteers. Such policies should clearly define and protect the rights of employees by assuring their fair treatment in all matters. Fair procedure for hiring and managing employees needs to be followed to maintain transparency. Copies of advertised job openings from newspapers, website or any other medium, job description, resumes and appointment/contract letters issued to fulltime, part time, volunteers or consultants should be in place.

Principle III: Financial Resource Management/Financial Controls

The Organization should conduct its finances while assuring appropriate use of funds and accountability to donors. The indictors for financial accountability would include a copy of annual audited financial statement by a qualified and independent chartered accountant; copy of financial manual/policy containing written procedures, financial rules, routines and process; minutes of annual general meeting containing financial statements; copy of auditor’s report; copy of balance sheet and treasurer’s report.

Principle IV: Communication to the public

Organization should be committed to full, honest, and accurate disclosure of relevant information concerning its goals, programs, finances, and governance. Fundraising solicitations should be truthful; accurately describe the organization’s identity, purpose, programs, and only make claims which the organization can fulfil; and avoid placing excessive pressure on donors. There should be no material omissions or exaggeration of facts, no use of misleading photographs, nor any other communication that would tend to create a false impression or misunderstanding.

Principle V: Program standards

Minutes and reports of programs conducted should be made available to participants, donor agencies and other stakeholders to improve the efficacy of the programs. List of public policy and advocacy activities in which the organization is involved, especially if lobbying, are important indicators to ensure that organization’s activities are consistent with the mission and defined public interest. Documentation of best practices or case studies depicting the impact of advocacy, photographs or any other relevant document is also a good practice. Availability of monitoring and evaluation reports of programs, which includes well defined evaluation procedure for the board, staff and projects is an important indicator of mutual accountability/regular monitoring.

Challenges for self-regulation

The diversity of self-regulatory initiatives reflects the fact that their form is shaped by contextual factors such as the level of development of civil society, the resources that are available, and the nature of relations with the state. The different initiatives represent the efforts of the organizations to raise the standards of the sector and their accountability priorities. For example, most of the initiatives involving development organizations still give precedence to governance and financial management. There is still much work to do on focusing on beneficiaries and letting them shape priorities.
Self-regulation is a rapidly evolving field, with the clear majority of initiatives having emerged over the past decade and many still currently in development. While the research methodology for building, the inventory was designed to minimize oversights, the inventory is a work in progress and will rely on its users to keep it up to date.

Conclusion

The landscape of CSO self-certification is much more populated than expected, CSO self-certification is a rapidly evolving field with many initiatives having emerged in the past ten to fifteen years. Developments need to be monitored closely and globally to keep pace with these changes. Self-certification is influenced by factors such as the level of development of civil society, the resources that are available, and the level of debate on quality and accountability issues and the nature of relations with the state. Finally, CSO self-regulation has not permeated the sector evenly.

The challenge of bringing about the renaissance era of Indian CSOs is a daunting challenge: resources are scarce, spirits are low and bad habits are deeply ingrained. It is not suggested here that increasing the accountability of NGOs is the panacea to remedy this crisis. Rather, the premise is that promoting good governance among NGOs could be an important step in regaining and enhancing their public credibility. Voluntary Action Network India- (VANI) could play an important role in this process since it is already internationally recognized as good player in NGO self-regulation and have a mass reach. At the same time, it has built the necessary infrastructure to carry out a sector-wide campaign to shore up accountability practices as a measure of regaining public trust and recapturing the NGO community’s essential role in development.

VANI, as part of the IFP network, aims at giving to the Indian CSOs sector a new era where everybody’s voice is considered.