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Monday, June 13, 2011

Adaptive Accountability and Its Uses to External Stakeholders – Brian C

A recent article in class caught my attention by Alnoor Ebrahim on normative logics of accountability for the nonprofit sector. It took some discussion for me to understand a little about what Ebrahim was talking about in this article. Needless to say, I don’t see a future in academia for me. Ebrahim focused on accountability from three different categories: coercive, technocratic, and adaptive. Coercive accountability focuses more on governance with accountability being forced through external legislation and/or regulation to adhere to disclosure requirements. This may be in the form of having an annual audit, or it may entail a set of reporting to each individual grantor or governmental entity that provides funding based on their requirements. Technocratic accountability focuses more on performance measurement. There is a coercive component with funding requirements on reporting, but this category also focuses on professional standards and codes as part of the accountability. Both coercive and technocratic categories focus on requirements placed on the nonprofit by external parties. The third category is adaptive accountability, and this focuses more on internal requirements to improve accountability for programming and performance measures. Adaptive accountability does not embrace the cookie cutter performance measurements that are the hallmarks of coercive and technocratic accountabilities. One can easily see the benefits to the nonprofit by developing its own measures of accountability that focus on its mission accomplishment.

The problem with adaptive accountability is that it is not practical for external funding entities to try and learn the internal accountability measures of every nonprofit organization that receives funding from them. Nonprofits are bogged down with the myriad of reporting requirements placed on them through legislation, regulation, professional standards, etc. The variety of funding sources may mean that a nonprofit has to follow many different reporting requirements. This is administratively unfeasible for many nonprofits. If it is possible, it takes a large outlay of expenses to hire staff and put in place the components necessary to fulfill these requirements. There definitely needs to be some thought given to reducing the reporting requirements placed on nonprofits based on their unique structure. They may have multiple funding streams that all require different reporting on financial information and performance measures. This is not the case in the for-profit and public sectors. However, it cannot be solely left up to the nonprofit to determine their accountability measures either. The result should be a healthy discussion between the nonprofit sector and their funders. Most nonprofits have missions that can be grouped into certain general areas. For example, social service organizations could have many similar performance measures that could be standardized for that group. This would be beneficial to the nonprofit since performance measures are at least more applicable to their field, and it will help the external stakeholders by allowing some standardized measures to assess accountability. For-profit and public sector accountability measures should not be forced on nonprofits. There is a reason nonprofits make up the “third sector”. They are structurally different, and they should be treated that way. However, there must be some standardized measures developed to lessen the administrative requirements placed on nonprofits by external stakeholders while providing these same stakeholders with useful accountability measures to measure performance. This is not an easy path, but we should always strive for the utopia. Accountability and performance measures that are beneficial to both nonprofits and external stakeholders would allow nonprofits to focus on their mission and would provide external stakeholders with the information they need to ensure they are disseminating funding in a responsible manner.

References

Ebrahim, A. (2009). Placing the Normative Logics of Accountability in “Thick”

Perspective. American Behavioral Scientist, Vol. 52, No. 6, February 2009, 885-904.

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