Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Opinion / Online-views/  Amit Chandra | Shift the focus on internal governance
BackBack

Amit Chandra | Shift the focus on internal governance

If the social sector wants to scale up its impact quotient, it must strive to move beyond passion to deliverables, embrace transparency and build leadership within

A file photo of an NGO. Very few NGOs have boards that are deeply engaged, and that can constructively work with the CEO to scale the organization. Photo: Priyanka Parashar/MintPremium
A file photo of an NGO. Very few NGOs have boards that are deeply engaged, and that can constructively work with the CEO to scale the organization. Photo: Priyanka Parashar/Mint

There is a growing belief that civil society can play a tremendous role in helping raise the standards of governance of the social sector. I subscribe to the view that society and non-governmental organizations (NGOs) can and should actively partner the government, while also aiming to drive a lot of change by themselves. However, a fair degree of cynicism exists about NGOs at large, and many in the social sector believe that the real obstacle is inability to garner substantially greater resources, both financial and human. However, working with the social sector closely over a 15-year period, I have come to realize that this despair, while understandable, is often misplaced. I believe that much greater progress is possible, and that it is no accident that very few NGOs have meaningfully scaled and/or can claim to have made significant impact. If you look at the few success stories in this sector and the many failures, it is evident that three key issues relating to governance hold the sector back.

First is the problem that NGOs have historically centred their approach to social problems by combining their passion for change with an approach largely focused on magnitude of effort. To show for success, many rely on citing a few anecdotes to drive home the point, or awards that often aren’t robustly assessing the real impact of their efforts. More often than not, what is lacking is a crisp articulation of the specific problem they seek to ultimately address, at whatever scale they aspire. Without that, it also becomes very difficult for NGOs to meaningfully set milestones against which their success can be periodically measured. Let’s take the public education system for example. Having observed many NGOs running schools for a long time, I have come to believe that a very large number of them cannot claim to be substantially better off than the public school system. It is only now that we are seeing the emergence of a few NGOs who are clearly demonstrating that education can be substantially improved with alternative approaches. The common thread in most of these NGOs is clarity of their eventual goal in terms of learning outcomes, focus on measuring relative progress in a systematic way, and then driving the organization to strive for continuous progress on an annual basis. Moving from an effort- and passion-based approach to a performance-oriented approach is imperative for the sector’s longer-term success.

The third issue that NGOs must address is their internal organization capability and the approach to governance. This needs to start right at the top with CEOs and the NGO boards. Very few NGOs have boards that are deeply engaged, and that can constructively work with the CEO to scale the organization. The approach to building boards is often flawed and simply aimed at attracting friends who will be passively supportive, generate a sense of credibility and provide funding leads. On the other hand, the approach of many CEOs is to not invest in productive overheads, often at the instance of misplaced donors. Both approaches need to substantially change. CEOs must think carefully about the construct of the board, and push to attract people who can genuinely contribute, while simultaneously investing in the broader leadership team. On the other hand, board members must raise their own performance and work with the CEO to get the organization a lot more focused on issues like performance management, donor accountability/transparency, succession planning and skilling the leadership team. On the last point, the ecosystem for equipping NGO leaders with skills is nowhere close to what exists in the corporate world. It is imperative for CEOs/boards of NGOs to think about broadening the future leaders’ exposure by attending forums and meets. This requires sacrificing a bit of the short term, for a much better long term. Today there are many fellowships such as Dasra DSN (Dasra Social Network), Ashoka, Echoing Green, Harvard Business School’s SPNM (Strategic Perspectives in Nonprofit Management), and Aspen who have felt this need and have structured programmes to support training of key team members.

I have seen many NGOs with great potential and heart substantially perform well below their potential because of a lack of focus on these critical aspects. The combination of a good board and management team, both focused on substantially raising the bar on internal governance, can substantially improve the impact NGOs can make on society.

Amit Chandra is managing director of Bain Capital. He serves on many boards, both in the corporate and social sector. Views expressed here are personal.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 21 Mar 2015, 11:04 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App