Overview of NGOs

This article is based on an article prepared by Diana C. Carligeanu for the NGO Handbook, titled "NGO Overview: What are NGOs?.

“The 21st Century will be an era of NGOs."

-- Kofi Annan, UN Secretary General

What are NGOs?

Non-governmental organizations (NGOs) are generally considered to be “non-state, non-profit orientated groups who pursue purposes of public interest”, excluding the private sector (Schmidt and Take 1997). One of the most widely used definitions is given by Operational Directive 14.70 of the World Bank: “private organizations that pursue activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social services, or undertake community development” (World Bank 2001). More broadly, the term is applicable to any non-profit organization (NPO) that is not affiliated with government. According to the World Bank, NGOs are “value-based organizations which depend, in whole or in part, on charitable donations and voluntary service,” and in which “principles of altruism and voluntarism remain key defining characteristics”. The World Bank differentiates two main categories of NGOs with which it interacts: 1) operational NGOs, the primary purpose of which is the design and implementation of development-related projects, and 2) advocacy NGOs, the primary purpose of which is to defend or promote a specific cause, and influence the policies and practices of international organizations.

Operational NGOs are further classified as: a) national organizations, which operate in individual developing countries; b) international organizations, which are typically headquartered in developed countries and carry out operations in developing countries; and c) community-based organizations (CBOs), which serve a specific population in a narrow geographical area. CBOs, also referred to as grassroots organizations or peoples’ organizations, differ from other NGOs in both nature and purpose: while national and international organizations are seen as “intermediary” NGOs that are formed to serve others, CBOs are usually “membership” organizations whose purpose is to advance the interests of their members. Examples include women’s groups, credit circles, youth clubs, cooperatives and farmers’ associations.

Alternative terms used to refer to NGOs include private voluntary organizations (used especially in the United States) and voluntary development organizations (a term favored by many African NGOs).

Note: NGOs are not legal entities under international law, the way states are. An exception is the International Committee of the Red Cross, which is considered a legal entity under international law because it is based on the Geneva Convention.

Historical Background of NGOs

While voluntary associations of citizens have existed throughout history, the precursors of present-day international NGOs emerged in the 19th century. The International Committee of the Red Cross (ICRC) was founded in the late-1800s and non-state actors became active in areas such as women’s voting rights, international law and disarmament (WWI and Geneva Convention, etc.), as well as abolishing the slave trade. Anti-slave trade groups played an integral role in the abolition of slavery, and religious movements and organizations were also integral to the development of the NGO movement (e.g. Christian missionaries in Africa and subsequently launching aid societies and Islamic groups in the Middle East and charities, etc.).

After World War II, NGOs played an important role in identifying the need for human rights to be included in the UN Charter and, more generally, to develop the UN Human Rights System. For instance, they provided input into the drafting of the Universal Declaration of Human Rights and influenced the anti-discrimination policies of the United Nations. (Richmond 2005; Alger 2005; Klein 2002; Debiel and Sticht 2005)

The term non-governmental organization (NGO) came into use with the establishment of the United Nations organization in 1945, with provisions in Article 71 in Chapter X of the United Nations Charter for a consultative role for organizations that are neither governments, nor member states. In 1948, there were 45 NGOs in the consultative status defined in Article 71. Currently there are 2,719 NGOs in consultative status with the Economic and Social Council (ECOSOC), and approximately 400 NGOs accredited to the Commission on Sustainable Development (CSD), a subsidiary body of ECOSOC. ECOSOC Resolution 1296 (XLIV), adopted in 1968, established the criteria and rights associated with consultative status that were to be used for almost four decades, until ECOSOC Resolution 1996/31 was passed in July 1996.

The definition of an international NGO (INGO) first appeared in Resolution 288 (X) of ECOSOC, in February 1950, as “any international organization that is not founded by an international treaty.” The importance of NGOs and other “major groups” in sustainable development was acknowledged in Chapter 27 of Agenda 21, leading to the revisions contained in ECOSOC Resolution 1996/31.

The last two decades have witnessed a significant increase in the number of NGOs that emphasize humanitarian issues, security and peace, and sustainable development. A prominent example is the World Social Forum, which was conceived as a counter force to the World Economic Forum held annually in Davos, Switzerland. The fifth World Social Forum, held in Brazil in 2005, was attended by representatives of more than 1,000 NGOs.

According to Debiel and Sticht (2005), there are four key explanations for the increasing number and importance of NGOs:

1. The UN World Conferences of the 1990s (e.g. Rio, Beijing, etc.) offered major incentives for the establishment of new NGOs, and the expansion of existing organizations engaged in development and environmental issues at the international level.
2. The increasing power of mass media and the globalization of electronic communication facilitate the transnational networking activities of non-state actors.
3. International civil society organizations (CSOs) function as substitutes for former state-driven welfare services (health, education and social policy).
4. In many developing countries, NGOs are substitutes for formerly state-run activities in health and education, especially as international programs for economic reforms (e.g. IMF structural programs) forced states to reduce public services.

As Fischer (2006) notes, a fifth factor for the expansion of NGO activity appears to be the growing tendency of international and national development agencies to channel development aid through NGOs. Commenting on the exponential rise in NGO activities in both developed and developing countries, a World Bank report remarks that, “From 1970 to 1985 total development aid disbursed by international NGOs increased ten-fold. In 1992 international NGOs channeled over $7.6 billion of aid to developing countries. It is now estimated that over 15 percent of total overseas development aid is channeled through NGOs. While statistics about global numbers of NGOs are notoriously incomplete agree, it is currently estimated that there is somewhere between 6,000 and 30,000 national NGOs in developing countries. CBOs across the developing world number in the hundreds of thousands.” (World Bank 2001)

Types of NGOs

The NGO Global Network classifies NGOs based on their area of expertise, and lists the following major groups:

• Children & Youth
• Communications
• Conflict Resolution
• Disarmament
• Disaster Relief
• Drug Abuse
• Education
• Environment
• Ethics & Values
• Family
• Health & Nutrition
• Human Resources
• Human Rights
• Law
• Natural Resources & Energy
• Peace & Security
• Religion
• Trade, Finance & Transport
• Population & Human Settlements
• Refugees
• Science & Technology
• Sustainable Development
• Status of Women
• United Nations

Classification of NGOs

Below are several classification systems, and the classes/groups under which NGOs fall.

United Nations International Standard Industrial Classification (ISIC)

ISIC Rev. 3.1

http://unstats.un.org/unsd/cr/registry/regcst.asp?Cl=17&Lg=1 NGOs?

ISIC Rev. 4 (Draft)

http://unstats.un.org/unsd/cr/registry/regcs.asp?Cl=27&Lg=1&Co=9499 Code 94 – Classes 941, 942 and 949

Class: 9499 - Activities of other membership organizations n.e.c.

Explanatory note This class includes: - activities of organizations not directly affiliated to a political party furthering a public cause or issue by means of public education, political influence, fund-raising etc.:

• citizens initiative or protest movements
• environmental and ecological movements
• organizations supporting community and educational facilities n.e.c.
• organizations for the protection and betterment of special groups, e.g. ethnic and minority groups
• associations for patriotic purposes, including war veterans' associations

- consumer associations - automobile associations - associations for the purpose of social acquaintanceship such as rotary clubs, lodges etc. - associations of youth, young persons' associations, student associations, clubs and fraternities etc. - associations for the pursuit of a cultural or recreational activity or hobby (other than sports or games), e.g. poetry, literature and book clubs, historical clubs, gardening clubs, film and photo clubs, music and art clubs, craft and collectors' clubs, social clubs, carnival clubs etc.

This class also includes: - grant giving activities by membership organizations or others

This class excludes: - activities of professional artistic groups or organizations - activities of sports clubs - activities of professional membership associations

n.e.c. = not elsewhere classified

International Classification of Nonprofit Organizations (ICNPO)

http://www.jhu.edu/~ccss/pubs/pdf/icnpo.pdf Salamon, Lester M. and Helmut K. Anheier. "The International Classification of Nonprofit Organizations: ICNPO-Revision 1, 1996." Working Papers of the Johns Hopkins Comparative Nonprofit Sector Project, no. 19. Baltimore: The Johns Hopkins Institute for Policy Studies, 1996.

The International Classification of Nonprofit Organizations (ICNPO) was developed through a collaborative process involving the team of scholars working on the Johns Hopkins Comparative Nonprofit Sector Project (for a fuller description of the project, see Salamon and Anheier, 1996a). The system took shape by beginning with the International Standard Industrial Classification (ISIC) system (United Nations, 1990) and elaborating on it as needed to capture most succinctly the reality of the nonprofit sector in the thirteen different countries that were involved in the first phase of this project (the U.S., the U.K., France, Germany, Italy, Sweden, Japan, Hungary, Brazil, Ghana, Egypt, India, and Thailand).

Covered Entities=

The ICNPO was designed to differentiate entities that share five basic features and therefore make up the “nonprofit sector” (Salamon and Anheier, 1992; 1996b).1 In particular, they are:

1. Organized, i.e., institutionalized to some extent. What is important is that the organization has some institutional reality to it. In some countries this is signified by a legal charter of incorporation. But institutional reality can also be demonstrated in other ways where legal incorporation is neither common nor readily available. These include some degree of internal organizational structure; relative persistence of goals, structure and activities; and meaningful organizational boundaries, i.e., some recognized difference between members and nonmembers. What are excluded are purely ad hoc and temporary gatherings of people with no real structure or organizational identity.

2. Private, i.e., institutionally separate from government. Nonprofit organizations are not part of the apparatus of government. They are “nongovernmental” in the sense of being structurally separate from the instrumentalities of government. This does not mean that they may not receive significant government support or even that government officials cannot sit on their boards. What is important from the point of view of this criterion is that the organization has an institutional identity separate from that of the state; that it is not an instrumentality of any unit of government whether national or local, and that it therefore does not exercise governmental authority.

3. Self-governing, i.e., equipped to control their own activities. Some organizations that are private and nongovernmental may nevertheless be so tightly controlled either by governmental agencies or private businesses that they essentially function as parts of these other institutions even though they are structurally separate. To eliminate such situations, we add the further criterion that nonprofit organizations must be self-governing. To meet this criterion, organizations must be in a position to control their own activities to a significant extent. This implies that they must have their own internal governance procedures and enjoy a meaningful degree of autonomy.

4. Non-profit-distributing, i.e., not returning profits generated to their owners or directors. Nonprofit organizations may accumulate profits in a given year, but the profits must be plowed back into the basic mission of the agency, not distributed to the organizations’ owners, members, founders or governing board. The fundamental question is: how does the organization handle profits? If they are reinvested or otherwise applied to the stated purpose of the organization, the organization would qualify as a nonprofit institution. In this sense, nonprofit organizations are private organizations that do not exist primarily to generate profits, either directly or indirectly, and that are not primarily guided by commercial goals and considerations. This differentiates nonprofit organizations from the other component of the private sector.

5. Voluntary, i.e., involving some meaningful degree of voluntary participation. To be included in the nonprofit sector, organizations must embody the concept of voluntarism to a meaningful extent. This involves two different, but related, considerations: First, the organization must engage volunteers in its operations and management, either on its board or through the use of volunteer staff and voluntary contributions. Second, “voluntary” also carries the meaning of “non-compulsory.” Organizations in which membership is required or otherwise stipulated by law would be excluded from the nonprofit sector. Similarly, “voluntary” implies that contributions of time (volunteering) and money (donations) as well as contributions in kind may not be required or enforced by law, or otherwise be openly coerced.

Basic Structure of the ICNPO

As reflected in Table 1 (below), the ICNPO system groups the nonprofit sector as defined above into 12 Major Activity Groups, including a catch-all “Not Elsewhere Classified” group. These 12 Major Activity Groups are in turn further subdivided into 24 Subgroups. Each of the Subgroups has in turn been broken into a number of Activities, but the ICNPO system as currently developed does not attempt to achieve standardization at the level of the Activities because of the great diversity of the nonprofit sector in the different locales.

Clarifications

In applying the ICNPO, several types of organizations often prove difficult to classify, and the current Revision (elaborate) is meant to clarify their treatment:

Non-governmental organizations (NGOs), are classified according to their major activities. For example, NGOs offering basic health care services in rural areas would be classified in Group 3 400, “other Health Services”; local NGOs providing development assistance by building local infrastructure would be classified in Group 6 100 “Economic, Social, and Community Development;” and organizations providing international humanitarian relief would be grouped in 9 100 “International Activities.” (see Table 1) Following national accounting principles, we would classify NGOs working internationally under Major Group 9 in their home country, and under their principal economic activity in their host country. For example, OXFAM would be classified in 9 100 “International,” in the United Kingdom, but its local operations in Peru would be classified under Group 6 “Development and Housing,” Group 5 “Environment,” Group 4 “Social Services” or some other major group as applicable.

Table 1. The International Classification of Nonprofit Organizations, Major Groups and Subgroups

• GROUP 1: CULTURE AND RECREATION
  • 1 100 Culture and Arts
  • 1 200 Sports
  • 1 300 Other Recreation and Social Clubs
• GROUP 2: EDUCATION AND RESEARCH
  • 2 100 Primary and Secondary Education
  • 2 200 Higher Education
  • 2 300 Other Education
  • 2 400 Research
• GROUP 3: HEALTH
  • 3 100 Hospitals and Rehabilitation
  • 3 200 Nursing Homes
  • 3 300 Mental Health and Crisis Intervention
  • 3 400 Other Health Services
• GROUP 4: SOCIAL SERVICES
  • 4 100 Social Services
  • 4 200 Emergency and Relief
  • 4 300 Income Support and Maintenance
• GROUP 5: ENVIRONMENT
  • 5 100 Environment
  • 5 200 Animal Protection
• GROUP 6: DEVELOPMENT AND HOUSING
  • 6 100 Economic, Social and Community Development
  • 6 200 Housing
  • 6 300 Employment and Training
• GROUP 7: LAW, ADVOCACY AND POLITICS
  • 7 100 Civic and Advocacy Organizations
  • 7 200 Law and Legal Services
  • 7 300 Political Organizations
• GROUP 8: PHILANTHROPIC INTERMEDIARIES AND VOLUNTARISM PROMOTION
• GROUP 9: INTERNATIONAL
• GROUP 10: RELIGION
• GROUP 11: BUSINESS AND PROFESSIONAL ASSOCIATIONS, UNIONS
• GROUP 12: NOT ELSEWHERE CLASSIFIED (NEC)

National Taxonomy of Exempt Entities – Core Codes (NTEE – CC) = the industry-wide standard for nonprofit organizational classification

The National Center for Charitable Statistics is the national clearinghouse of data on the nonprofit sector in the United States. NCCS is a program of the Center on Nonprofits and Philanthropy (CNP) at the Urban Institute.

http://nccsdataweb.urban.org/FAQ/index.php?category=73 Good way to read: http://foundationcenter.org/ntee/ The Foundation Center and the IRS (and some others) use the NTEE (National Taxonomy of Exempt Entities). Unclear. I’m assuming the above is temporary.

Designed by a team of experts, the NTEE-CC includes approximately two-thirds, or about 400, of the 645 categories in the original NTEE. Though the majority of the differences in the NTEE-CC are a result of collapsing lesser-used codes, improvements were also included. With its ease of use and consistent hierarchical logic, the NTEE-CC serves as the best instrument for tax-exempt status determination, NAICS linkage, and nonprofit organizational classification. As of early 2006, approximately 800,000 organizations have been classified using the system.

Using the NTEE-CC The NTEE-CC classification system divides the universe of nonprofit organizations into 26 major groups under 10 broad categories as follows:

Major Group I. Arts, Culture, and Humanities - A II. Education - B III. Environment and Animals - C, D IV. Health - E, F, G, H V. Human Services - I, J, K, L, M, N, O, P VI. International, Foreign Affairs - Q VII. Public, Societal Benefit - R, S, T, U, V, W VIII. Religion Related - X IX. Mutual/Membership Benefit - Y X. Unknown, Unclassified - Z

References

• Hodgkinson, Virginia A., Murray S. Weitzman, John A. Abrahams, Eric A. Crutchfield, and David R. Stevenson. Nonprofit Almanac 1996–1997: Dimensions of the Independent Sector. San Francisco: Jossey-Bass Publishers, 1996

• Kaplan, Ann E. (Ed.). Giving USA, 1997: The Annual Report on Philanthropy for the Year 1995. New York: AAFRC Trust for Philanthropy, 1997.

• Kovacs, Ruth and McLaughlin, Ben (Eds.) Grants Classification System Indexing Manual with Thesaurus. New York: The Foundation Center, 1995.

• Sales, Georgia. 1994. A Taxonomy of Human Services, 3d ed. Los Angeles: INFOLINE, Seattle: AIRS.

• Sales, Georgia. AIRS/INFOLINE Taxonomy of Human Services. 16 March 2005 http://www.211taxonomy.org/

• Stevenson, David R., Pollak, Thomas H., Lampkin, Linda M., Pettit, Kathryn L.S., and Stengel, Nicholas A. J. State Nonprofit Almanac 1997: Profiles of Charitable Organizations. Washington, DC: The Urban Institute Press, 1997.

• Sumariwalla, Russy D. "Toward a National Taxonomy of Exempt Entities" prepared for INDEPENDENT SECTOR, March 1986.

• International Standard Industrial Classification of All Economic Activities (ISIC), Rev. 3, Adopted by the twenty-fifth session of the United Nations Statistical Commission, New York, 6-15 February, 1989.

http://www.stanford.edu/group/csw/report_hridata.doc http://www.lse.ac.uk/collections/CCS/pdf/IWP/int-work-paper1.pdf (for references) http://www.staff.city.ac.uk/p.willetts/CS-NTWKS/NGO-ART.HTM