In this article, we provide an insight into the National Council of Social Service's efforts in leading the people sector in the areas of accountability and governance.

This article covers major areas discussed by Mr Benedict Cheong, Chief Executive Officer of NCSS, at the "2001 National Volunteer Conference for Non-Profit Organisations: Managing Results in the New Economy." Mr Cheong was a guest presenter at the event, organised by the National Volunteer Centre. It was held on 23 - 24 July 2001 at the Shangri-La Hotel.

Two years ago, NCSS first surfaced the need for greater accountability and better governance in voluntary welfare organisations (VWOs). This drew mixed reactions from VWOs.

While some argued that promoting accountability and governance would compromise service quality and compassion, others supported the need for greater accountability and better governance. They felt this was necessary to ensure that resources would be better utilized, and that donors and volunteers would continue or enhance their involvement in programmes.

Since then, NCSS has conducted a series of board governance training programmes for our VWOs, and we plan to continue helping them develop their governance capability over time.

This is because the NCSS experience has shown that accountability and good governance are necessary for sustained effectives - not just for VWOs but for all non-profit organisations. With the drive towards our Singapore 21 vision, and the promotion of active citizenship, the people sector in Singapore must develop and enhance its professionalism and capability. It is timely that due attention is given to the issues of accountability and good governance in non-profit organisations.

Accountability, transparency and good governance are the keys to enhanced partnerships between the non-profit organisation and donors and volunteers. They provide an edge for the non-profit organisation against other organisations in the competition for donor and volunteer resources. This will in turn ensure the long-term sustainability of the organisation.

At NCSS, we perceive that donors and volunteers increasingly want assurance that their donations and volunteer services are being put to food use, for the benefit of people we serve. Donors are naturally reluctant to fund agencies that have excess reserves, preferring instead to fund programmes that are in greatest need of resources.

Volunteers and would-be volunteers, too, expect to be better managed by agencies. Those who are mismanaged by VWOs are left an indelible impression and are likely to share their unpleasant experiences with others. Over time such agencies would develop bad reputations.

NCSS also takes the view that since almost all the resources of non-profit organisations come from the community and the government, it is the duty of such organisations to have good governance systems, structures and processes. Non-profit boards act as stewards of community resources that are used for the benefit of the clients or the cause. Such boards thus have a duty to manage these resources well, and they are accountable to the community for the use of resources. This applies to all non-profit sectors, not just social services.

Basic governance responsibilities encompass key areas such as setting the mission and vision, organisational planning, overseeing the use of resources and monitoring programmes and services.

Underpinning these responsibilities are two key pillars - the need for accountability and cost effectiveness in the use of resources.

Non-profit boards must know to whom they are accountable. There are at least three different groups that most non-profit organisations are accountable to. Membership organisations are naturally accountable to their members, while non-profit organisations are also accountable to donors and funders including the government if it is a funder, and its accountability takes the form of reports on funded programmes and services. The third group that non-profits need to be accountable to are the users of the services or the beneficiaries of the programmes.

In the drive towards greater accountability, NCSS has introduced a programme evaluation system (PES) for funded programmes and services.

The system is a formal analytical process that incorporates programme outcome and output measures jointly defined by NCSS, the agency and to the extent possible, the users of the services.

The PES can also be extended to cases where the non-profits serve a social cause or society as a whole. NCSS is in the pioneer stages of this system and learning from the implementation. At this point, we plan to use the system to review and improve programmes, and to set standards for services.

For the PES to have maximum impact, it should include the measurements of cost effectiveness and value added. This is the next level of accountability because we will then move beyond outcomes and outputs, to determining the value created. This will lead to more informed and better resource allocation.

The pillars of accountability and cost effectiveness mean that the board of a non-profit organisation must have persons able to do financial management, planning, budgeting and monitoring of programmes. The NCSS experience shows that these are sometimes left to the paid staff or are not discharged well. This is an area that warrants close attention as it is clear that the board cannot abdicate its responsibility in this area.

Hence, two of the annual NCSS workshops for VWO board members cover issues relating to planning, finance and monitoring the use of resources. In this area, we will enhance our training programmes, develop a manual on managing accounts, and strive to build up our consultancy capability.

Another key challenge that NCSS has set out to embrace is the issue of managing volunteers and professionals.

Most non-profit organisations have volunteers working side by side with professional staff. Volunteers serve on boards and committees and also in projects or hands-on work. Professional staff are employed as managers, finance, human resource and technical staff, social workers, programme co-ordinators and others.

There is good reason for the non-profit boards to comprise only volunteers. Non-profits receive donations and grants, from government, corporations and the community. If board members were paid, there would be a conflict of interest when they fund-raise. Indeed, donors and funders would not know if the funds they provide really go to the organisation's services and programmes, and not just to board members' salaries.

With volunteers governing non-profits and directing paid professional staff, there is potential for conflict.

From the NCSS experience, it is obvious that many real-life examples abound. To illustrate, here are just a few of the scenarios that could prevail:

· Some boards are too involved in micro-management and the paid staff are not allowed any room for initiative.

· Other boards are too hands-off, involved only in name. The paid staff are not guided in their work. Even worse is where paid staff are not governed at all, notably in the area of finance and use of resources.

· Some board members have served for many years in a particular organisation. While their experience is appreciated, some of them can be a stumbling block to innovation and new direction.

· In some organisations the chairperson brings in his or her close friends and contacts through election or appointment to serve on the board. While this helps in board dynamics, it can lead to a "group-think" situation where board members always agree with the chairperson. This will hinder innovation and initiative.

· Some paid staff find creative ways to withhold information from their boards and keep them out of decisions. In some organisations, paid staff run the show without any deference to board members.

These examples show that managing volunteers and professionals can be a daunting task. However, it presents a challenge that needs to be addressed, if volunteers and professionals are to work effectively together, with common purpose and vision.

At NCSS, we have for sometime now been grappling with the key issues and difficulties that confront us in the areas of accountability and governance. In the process, we have managed to get a better feel of what needs to be done.

For example, we have found that we need clear job descriptions and terms of reference with well-defined expectations for both volunteers and staff, and at all levels. We have always had terms of reference for our Board committees and we are starting our effort to work out Board member job descriptions. Through these, Board members will know their respective responsibilities and tasks.

We also involve our Board members in strategic planning either at Board meetings or at special sessions or days of reflection. This is so that they will be involved fully in the governance of the organisation. In NCSS, we plan to enhance our board development programmes, in board orientation and on-going training.

We also found that we needed the parameters for board-staff interaction and relationships to be clearly stated. These made NCSS board-staff partnerships that much more effective. Again, in NCSS, we know that we need to continue our effort in this area. Also, for some sensitive positions on our Board, e.g. the Honorary Treasurer, we have term limits so that no one person can hold the positions for too long.

For our member VWOs, we recognise their independence and would not want to impose all our policies and procedures on them. It is more fruitful to provide encouragement and support, and facilitate our mutual learning and growth in the area of governance. To this end, we have started to run workshops and we are working at enhancing our board development consultancy capability.

It is clear that the trend for non-profits in the developed countries, such as the United States, is an increasing emphasis on the accountability and good governance.

All stakeholders concerned are unanimous on this. The funders and donors want it, the volunteers want it, and the users and beneficiaries want it. The long-term sustainability of non-profit organisations depends on these stakeholders, and ultimately on the levels of accountability and governance in the non-profit organisations.

NCSS will therefore continue to set the pace for the enhancement of accountability and governance for our VWOs and non-profit organisations. This move is in tandem with the NCSS vision for social services in the 21st century.

Contents taken from RAPPORT, a quarterly publication by the National Council of Social Service, July - September 2001 issue