Guide to Financial Management in the NGO Environment
Guide to Financial Management in the NGO Environment
This section of Mango’s Guide describes what NGOs do and some implications for how they are managed. Finance managers must understand what NGOs do to help staff make the best use of their funds.
For example, there are some essential differences between NGO work and commercial work.
NGO work involves involving complicated social situations and responding to people’s changing needs.
Almost all NGOs are small and not very powerful compared to the scale of poverty and injustice that they aim to tackle. They are also small compared to institutions that create and reinforce poverty, such as political interests, business interests, cultural factors, conflict, and many others.
So, NGOs aim to achieve their goals in four ways:
- Empowering people to have more influence over factors that affect them.
- Service delivery, providing welfare services to people, including emergency humanitarian aid.
- Lobbying influential decision-makers to take account of the poor
- Capacity building to help local organizations achieve more.
These activities overlap with each other.
They are all based on social values about how people relate to each other – such as demonstrating fundamental respect for each other.
NGOs often find that helping people is difficult. It is hard to solve other people’s problems.
However, practical help depends on understanding the local context and developing a solid relationship with local people.
This has important implications for how NGOs organize their work.
They have to encourage their staff to take a flexible approach to work closely with people at the local level – while also maintaining minimum standards of control. Mango sums up the implications of this in two golden rules:
Two golden rules
1. NGOs must maintain a respectful dialogue with the people they aim to help.
2. NGOs depend on their field staff and have to empower them to make sound judgment
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Reference: MANGO
