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Business of NGO's

Business of NGO's

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Business of NGO's

General awareness is a must for cracking MBA entrance exams & thereby GD & PI  and for few IIMs- Extempore Speech , Written Ability Test. 

We at MBARendezvous.com - India's content lead  MBA Website have started series of articles to equip MBA aspirants with general awareness with the hope that you would get success in various MBA entrance exams

Following article on” Business of NGO's ” is part of our series on general awareness: 

India, a country of 1.5 billion people has a long tradition of social service, social reform and voluntary agencies. This tradition was further cultivated with the emergence of NGOs that cropped up soon after independence when Mahatma Gandhi made a plea for dissolving the Indian National Congress (the political party which came into power upon Independence), and transforming it into a Lok Sevak Sangh (Public Service Organization).

The plea however, rejected did not halt the formation of NGO’s in India. Many followers of Gandhi established voluntary agencies to work closely with the governmental programs on social and economical issues. These agencies organized handicrafts and village industries, rural development programs, credit cooperatives, educational institutions, etc.

But in 1960, the NGO’s went through a second phase of transformation when governmental programs seemed to be inadequate to deal with the deprived sections of India. These grass roots organizations worked at the micro-level with limited resources and lack of coordination to deal with issues such as bonded labourers, landless farmers, poverty etc.

With the coming of economic reforms and introduction of the Sixth Five Year Plan (1980-1985), the government identified new areas in which NGOs as new participants could participate in the developmental process of country. These areas included:

  • Optimal utilization and development of renewable source of energy, including forestry through the formation of renewable energy association at the block level.
  • Family welfare, health and nutrition, education and relevant community programs in the field.
  • Health for all programs
  • Water management and soil conservation
  • Social welfare programs for weaker sections
  • Implementation of minimum needs program
  • Disaster preparedness and management (i.e. for floods, cyclones, etc)
  • Promotion of ecology and tribal development, and
  • Environmental protection and education.

With the opening of avenues in the job sector today NGO is considered as a viable option for many to take it up as a profession.

An NGO stands for Non-government organization. The term originated from the United Nations and is normally used to refer to organizations which are established for some specific purpose but do not form part of the government and are not conventional for-profit business.

 In the cases in which NGOs are funded totally or partially by governments, the NGO maintains its non-governmental status by excluding government representatives from membership in the organization. NGO’s pursue some wider social aim that has political aspects, but are not overtly political organizations such as political parties Today; India has a vigorous NGO sector. Although there has been no complete census of NGOs, it is estimated that about 25,000 to 30,000 are active in India.

A decade ago, NGOs were fairly peripheral in the global as well as national platform but now they participate actively in various political, economical and social matters. The involvement of NGOs in making decisions on the environment, sustainable development and human rights have increased the legitimacy and transparency of intergovernmental deliberations.

NGOs come in all sizes, shapes, ideologies, nationalities, organizing structures and styles. Some focus on mere local issues while some address issues that span the entire globe. Their very diversity reflects the complexity of these organizations.

NGO may be a ubiquitous term, but it is used to describe an array of groups and organizations - from activist groups to development organizations delivering aid and providing essential public services. Few NGOs are research-driven policy organizations, looking to engage with decision-makers. Still others act as watchdogs, casting a critical eye over events like domestic violence or female infanticide.

In a nutshell, NGOs encompass everything from charities and relief agencies to political parties; think tanks and academic centers to community organizations; cultural associations to continent wide farmers' networks; women's groups to environmental federations; social movements to human rights and religious groups.

Some of the noted NGOs organizations are the International Red Cross, Oxfam Care, Amnesty International, World Federation of United Nations Associations, etc. In India, Smile Foundation, Help Age India, Goonj, Udaan are some of the prominent ones.

Many of us view NGOs as promoting socially responsible activities and engaging in philanthropic efforts. What is less known is that several are also partnering with major corporations around the globe to fund themselves? With the retreat of the state from a number of public functions and regulatory activities, NGOs have begun to fix their sights on powerful corporations - many of which can rival entire nations in terms of their resources and influence.

On the surface, such partnerships may seem strange, since historically business and NGOs have had a somewhat traditional relationship (mostly instigated by the NGOs). But enlightened companies and a few business-friendly NGOs have realized that their interests are more often aligned than not, and they have much to gain from working with one another.

With funding or aid becoming an important factor NGOs want to make a big impact so they choose their corporate partners carefully. They look for opportunities where they can participate in a partnership and make a transformative change.

NGOs are also seeking promotion and publicity for their efforts. They insist on being able to communicate the results from corporate projects in the hope that it will spur other companies and industries to adopt similar practices. But sometimes, NGOs often communicate in language that is not relevant for business. Many companies are also reluctant to engage with NGOs because they don’t know where to start, or they consider themselves to be too far behind, and fear they will be ostracized for it. Another concern is the cost of these “partnerships.” Both sides should also clearly spell out their objectives, and identify the outcomes they have in mind to define success, and avoid shocks down the road.

Some research has shown that many are still toddlers and only a few NGOs know how to communicate effectively with business. Businesses cannot relate to goals (however noble) related to climate change and oceans and making the world a better place. They need to know how an NGO can solve their business problems, in language that relates to their objectives and challenges.

And with the coming of globalization now NGOs can also be more open to, and pro-active in forming, partnerships with business. NGOs have played a major role in pushing for sustainable development at the international level. Much of the credit for creating these trends can be taken by NGOs. But how should the business world react to NGOs in the future or should they hold out hope those NGOs can sometimes be helpful partners?

Public surveys reveal that NGOs often enjoy a high degree of public trust, which can make them a useful tool but not always sufficient for the concerns of society and stakeholders. Not all NGOs are comfortable to collaborate with the private sector. Some will prefer to remain at a distance, by monitoring, publicizing, and criticizing in cases where companies fail to take seriously their impacts upon the wider community.

 However, many are showing a willingness to devote some of their energy and resources to working alongside business, in order to address corporate social responsibility. But the paradoxical situation is that with the long-term aid people get aid for being poor. Poor people get extra food and other benefits. But those struggling out of poverty get little or no assistance.

While society by and large would agree that NGOs benefit the world from a social perspective, we suspect most of the business community would say that NGOs’ objectives are not aligned with their own. NGOs in general, and the activist ones in particular, need to do a better job of communicating their value proposition in language that business understands, and business needs to be more receptive to listening to, and working with NGOs.

NGOs want to be heard. Most have noble ideals and goals and want to make a difference. Even if business does not partner with them, it should listen when they come knocking the doors.

Read  GK topics and stay tuned to  www.mbarendezvous.com, India's only content lead MBA portal.