Local CSOs’ contribution to development is enormous. Depending on their priorities, local NGOs complement government and private sector development initiatives, engaging in humanitarian works, mobilizing communities for public engagements, raising awareness, and advocating for policy improvement and changes Organizations.
About 3000 registered civil societies in Ethiopia, where about 2500 are local. Local CSOs are primarily dependent on funds received from donors. Inspired founders form local CSOs to achieve specific social goals. Founders often do not have the financial resources to strengthen their CSOs. Due to the limited funding supply, local CSOs could not invest more in human capital and organizational system development. Due to the low pay scale, they face high staff turnover compared to the international CSOs in Ethiopia.
It is not uncommon for some international NGOs or funding agencies to conduct organizational capacity assessments (OCA) as part of their due diligence process to determine whether the CSO can implement a project they intend to grant. Donors use an assessment framework to assess organizational capacity. Though there are variations between the frameworks used by different donors, they are similar in terms of the thematic areas they cover. The most common assessment pillars are financial management, administration policy & procedures, human resource, project management, monitoring & evaluation (M&E), and organizational management & sustainability. Some donors incorporate specific cross-cutting issues, including gender, inclusiveness, child and youth protection, climate, and environmental policies and practices.
Target Business Consultants Plc assessed the performance of 10 civil societies in 2022. The assessment covers the above thematic areas and considers the CSOs’ institutional values, culture, governance, and relationship with their donors, beneficiaries, and counterparts.
Target team conducted the assessment primarily based on one-day face-to-face interviews, document reviews, and questionnaires. The CSOs management validated the findings with the respective CSO management team. CSOs were given a rating of 1 and 4 for each thematic area, where 1 is low capacity, 2 is vital capacity, 3 is moderate capacity, and 4 is high capacity. To make the assessment representatives, participating CSOs were a mix of newly established ones, those with less than five years of experience, and those over ten years old.
Assessment Findings:
The average scoring was 2.61 out of 4. Relatively, CSOs has better capacity in financial management and internal control, which is 2.81.
- Governance and Organizational Structure
- Strength: All accessed CSOs have an independent board of directors or executives who are somehow engaged in providing strategic direction in fundraising, partnership, and policy issues to the management bodies of assessed CSOs. The presence of vision and mission statements in all the assessed CSO, and a couple of them either having program objectives or program action plans, helped advance their very cause and decide on program design and strategic issues.
- Needs improvement: For some of the CSOs, the board of directors lacks professional diversity to help them to lead the CSOs strategically. Some CSOs do not have ethics policies, and organizational structures are often generic, which do not reflect the nature and complexity of the project they manage, and roles and responsibilities may not be comprehensive
- Financial Management and Internal Control
- Strength: Project-based budgets are clear and generally realistic. CSOs use a computerized accounting system. Most of them produce financial reports from donors and projects. They have fair internal control procedures.
- Needs improvement: Most assessed CSOs do not prepare multiyear revenue and expenditure forecasts and a master budget other than fragmented project-specific budgets. 50% of the assessed CSOs do not have a strategic plan. Most CSOs have limitations with the use of accounting software, accounting standards, financial reports, and the practice of conducting risk assessments.
- Administration and Procurement System
- Strength: Most of them have access to the internet. Most CSOs have a purchase committee, written fixed asset policies and procedures, and maintain a fixed asset register. Almost all CSOs have standard travel advance request and settlement forms and perdiem rates and comply with donor requirements. Some of them have procurement policy and procedures which are applied mainly.
- Needs Improvement: Most do not have a compressive written operating policies procedure mainly for managing vehicles, equipment, emails, safety, security, and handling of stolen or lost assets. All of them do not have written IT policies and procedures. There is no comprehensive backup strategy and practice for data. Some of the CSOs have limited computers; if they have, they are too old. Most of them do not prepare a procurement plan. Most of them do not compute depreciation and do not allocate the cost of shared assets. Almost all do not have a branding and marking policy and procedure.
- Human Resources system
- Strength: Most have a policy and procedure on staffing and job description embedded in their HR manual. Most of them do have a transparent recruitment process, and most check candidates’ backgrounds. Nearly all of them have a comprehensive HR manual. Few of them prepare a work plan and do performance review meetings frequently. Salaries and taxes are calculated accurately and paid monthly on time.
- Limitations: CSO’s Training and development are largely primarily based on training opportunities granted by donors than need assessments. Staff turnover is a concern for most CSOs, mainly attributed to low pay. Most CSOs do not have a staff performance appraisal practice and performance appraisal guidance for supervisors. Most of them do not have a salary scale, and payments are based on the budget allocated in grant agreements. Most of the assessed do not have policies and procedures for volunteers and internships.
- Program Management
- Strength: Most CSOs prepare milestone-based, quarterly, semi-annual, and annual reports depending on the requirements of a specific donor. They also prepare quarterly and yearly activity reports for the board. Few CSOs incorporate gender and cultural issues in project proposals and observe them during the implementation of projects.
- Needs Improvement: The CSOs lack policy procedures and systems that will help streamline their project management functions. The absence of stakeholders’ involvement strategy, and guidance on technical reporting, will detrimentally affect implementation and outcome harvesting and accountability to the donor, which in turn undermines efforts of complying with donor requirements. Gender, culture, and disability are some of the domains that any human rights violation cantered. While few of the CSOs try to entertain such issues internally and externally through human resource manuals or safeguarding policies, provisions, and existing practices lack depth and width to deal with gender, disability, religious and ethnic backgrounds within the organizational premises and also interacting with beneficiaries. Moreover, the staff does not have the capacity and exposure to tools to address such issues while designing new projects and programs, targeting, monitoring, and evaluating.
- Project Performance Management
- Strength: Most CSOs have employed several methods to follow up on their work and results and have monitoring and evaluation manuals. Few of the CSOs have standards for service delivery.
- Needs Improvement: CSOs lack policy procedures and systems that will help streamline their monitoring and evaluation functions. The absence of data quality assurance mechanisms will detrimentally affect implementation and outcome harvesting and accountability to the donor, underminings efforts to meet donor requirements. Most of the CSOs do not have experience in evaluating their projects, don’t have an evaluation policy, and do not have service delivery standards. In Most CSOs, the performance of project accomplishment is not rated by the donor, beneficiary, or government counterpart. There are no practices for conducting a client satisfaction survey.
- Organizational Management & Sustainability
- Strength: All the CSOs have a vision and mission statement, and most have written strategic and organizational work plans. In most CSOs, there is good communication and information flow between management and staff on the one hand and among staff on the other. Some CSOs are members of networks and use these networks as avenues to advocate for human rights issues, share knowledge and information and collaborate on resource mobilization. Some CSOs actively use social media; the website is functional for external communication.
- Needs improvement: The sustainability of some CSOs is under question as they don’t have well-framed and budgeted strategic plans, resource mobilization, and fundraising strategies. Most CSOs do not adequately document Institutional memories, knowledge products, and learnings. They do not have a written procedure to govern these functions. Most CSOs do not professionally manage Internal and external communications. Most of the CSOs are not leading communication through a documented strategy. If the executive directors of assessed CSOs leave the organization, some of the CSOs could struggle to continue operations.
Recommendations
CSOs can benefit significantly by conducting a self-capacity assessment based on a framework designed for civil societies. The Self-assessment result would be a basis for developing a capacity development plan and intervention to enhance the CSOs’ operating capacity and to be a preferred implementor by potential donors. The success of any capacity development effort depends on the level of ownership of the change process and commitment established at all levels of the organization. An organization is regarded as a system, and a change in one part/aspect usually creates change in other parts.
CSOs can not resolve all the capacity gaps simultaneously, requiring resources. Hence, it is suggested that the organization set priorities after critically analyzing the anticipated effects of the gaps on the day-to-day performance of the organization. Some interventions are easy to address using the organization’s internal capacity, while others should be carried out with external technical assistance. Some areas require additional knowledge and skills. The CSOs have the potential to address many of the findings, provided it follows a clear and measurable organizational capacity development plan.
CSOs should work hard for sustainability and ensure securing resources to support operating expenses. Some of the interventions can be in the form of training, mentoring, and coaching. Key areas of activity include financial management literacy, resource mobilization, human resource management, monitoring and evaluation skills, project management, and program management skills. A digital mindset is essential for CSOs as there is a lot they can benefit from in terms of reaching their beneficiaries, enhancing networking efforts, delivering services, and enhancing the efficiency of organizational management.
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