The NGO Sector and Regulation Review Tool is a tool to help countries undertake an assessment of their NGO sectors. The Tool provides a methodology for assessing the sector. Using it, the assessment team will be able to:
• obtain information on the NGO sector, its size, activities and diversity;
• map the regulatory mechanisms in place;
• identify any gaps or weaknesses in the regulatory coverage;
• assess the effectiveness of regulatory systems;
• identify strategic priorities.
The Tool is being developed by the International Programme of the Charity Commission for England and Wales. The Tool was initially tested in a pilot in the Philippines in 2008. The final report from this was produced in August 2008 and can be found here.
In 2009 the Tool was used in Indonesia to review its non-profit sector. A copy of a report setting out the findings of this review is available here.
Please read the Frequently Asked Questions that follow for more information. If you have any further questions, please contact the Charity Commission’s International Programme at internationalprogramme@charitycommission.gsi.gov.uk
Why have an NGO Sector and Regulation Review Tool?
Will implementing this Tool ensure compliance with FATF Special Recommendation VIII?
What restrictions are there on the use of the Tool or the results of an assessment?
How much will it cost to implement the Tool?
Why have an NGO Sector and Regulation Review Tool?
Recent years have seen unprecedented interest in the issue of NGO legislation and regulation. There are many reasons: the unprecedented growth of the global NGO sector; the increasing sophistication of the sector; the growth of multi-national NGOs; a more complex relationship with government as partner, service provider, critic and rival; and a focus on the sector as a potential weak-spot in global anti money laundering and counter terrorist financing efforts, as illustrated by Special Recommendation VIII of the Financial Action Task Force (FATF SRVIII).
These factors put pressure on both governments and NGOs to identify the risks to the NGO sector. The NGO Sector and Regulation Review Tool (the ‘Tool’) has been designed by the staff of the Charity Commission’s International Programme to help identify the risks that affect the sector in a particular country and assess how effective existing regulation of the sector – whether by the Government as state regulation or by the sector as self-regulation - is in mitigating that risk.
Will implementing this Tool ensure compliance with FATF Special Recommendation VIII?
The FATF Special Recommendations apply to all governments that are members of the Financial Action Task Force (FATF) or FATF-Style Regional Bodies (FSRBs). Special Recommendation VIII and the associated Interpretative Note require governments to:
• review the adequacy of laws and regulations in relation to NGOs;
• know the characteristics of their NGO sector;
• implement measures to prevent:
• terrorist organisations posing as NGOs;
• escape from asset freezing measures; and
• NGO funds being diverted to terrorist organisations.
This Tool deals with many of the recommendations and requirements of FATF Special Recommendation VIII. However, it has not been designed for the specific purpose of ensuring compliance with that recommendation. Whilst this Tool may assist in this process, government agencies responsible for ensuring compliance with SRVIII should refer directly to FATF or the relevant FSRB.
This has been designed by the International Programme of the Charity Commission for England and Wales.
This Tool was developed with the assistance of an advisory group made up of expert representatives from the NGO, government, donor and inter-governmental communities.
Financial support for the Tool was received from the UK Foreign and Commonwealth Office and the International Monetary Fund.
The Tool is the copyrighted property of the International Programme of the Charity Commission for England and Wales. The Charity Commission does not charge for the use of the Tool.
Please note that the Charity Commission retains the right to restrict or withdraw the use of the Tool for any reason.
The Tool takes a systematic approach that comprises four parts. Firstly, it identifies the key information on the NGO sector that needs to be known. Secondly, it identifies the different elements that make up a comprehensive framework for the regulation of the sector. Thirdly, it provides a mechanism for prioritising action. Fourthly, it provides a template for reporting the results. Each stage of the Tool is described in detail in a ‘Handbook’, which includes methodologies, definitions of key terms and concepts, and all the materials needed to undertake a survey and assessment. This handbook is available on request from the International Programme.
Part One: Sector Survey
Part One is a survey of the NGO sector. A series of preset questions will provide information on the size and nature of the NGO sector and the major risks that affect it, or are perceived to affect it.
Part Two: Assessment of the Regulatory Framework
Part Two assess the effectiveness of the regulation framework. The regulation framework describes the totality of laws, regulations, systems, processes and activities which are designed to regulate the NGO sector in a specific country, including both government-led regulation and self-regulation.
Part Three: Identification and communication of strategic issues
Part Three is mainly concerned with drawing out, collating, prioritising and communicating the strategic issues which the Tool has highlighted. Part Three provides a formal mechanism for considering these issues and risks. The process is undertaken by a working group of both governmental and non-governmental stakeholders, with the Local Assessment Team at its core.
Part Four: Final Report
Part Four concerns the production of the Final Report. The report is the ultimate outcome of the Assessment. It summarises the results from Parts One, Two and Three and identifies the main features of the sector, the main risks and makes recommendations for priority steps for the future. It is advisable for a final draft of the report to be presented to all key stakeholders, including all agencies that are in some way assessed by the process, so that they can respond to the conclusions and correct any errors of fact prior to final publication.
The Tool has been designed to be applicable in any country, regardless of size, legal system or level of development. However, different countries and different assessors will use the Tool in different ways. For this reason it is not intended that the Tool should be used to compare one country’s results with another. Instead, the aim of the Tool is to provide countries who want to review their NGO sector and the regulatory environment for NGOS with the framework and know how to do so. A further outcome of the exercise is the prompting of debate about the role and nature of the sector and the risks it faces, the highlighting of key issues and some potential solutions, which can then be taken forward to inform future actions to improve the strength of the sector within the local context.
The Tool is implemented by a Local Assessment Team (LAT). This body will have responsibility for ensuring that the Tool is effectively implemented and that, as far as possible, the recommendations which arise from its findings are brought to the attention of national level policy and law makers. Terms of Reference for the LAT are provided in Handbook which explain its role and responsibilities in more detail
The constitution of the LAT is the single most important factor in the successful implementation of the Tool. Permission to use the Tool is provided by the Charity Commission to the LAT, and the Charity Commission will only grant permission if it is satisfied with the constitution of the LAT. The Commission’s key concern is that the LAT is representative of the agencies being assessed by the Tool, as well as from all NGOs that are subject to the regulations being assessed.
The intention is that the Tool can be independently implemented by the LAT. However, in most cases prior specialist training or external assistance from experienced assessors will help improve the quality of the result. The Charity Commission will be happy to consider any such requests for training or assistance, subject to funding. The Charity Commission’s International Programme does not insist on being involved in the Assessment process itself.
What restrictions are there on the use of the Tool or the results of an assessment?
As stated above, the Tool is the copyrighted property of the International Programme of the Charity Commission for England and Wales. Whilst the Charity Commission does not charge for the use of the Tool, it can only be used with the written permission of the Charity Commission and the Commission retains the right to restrict or withdraw the use of the Tool at any time or for any reason.
Whilst the format of the Tool remains the property of the Charity Commission, the results are the property of the LAT and the agencies that constitute it. The LAT has the exclusive right to decide on the distribution or publication of the final report. If publishing, the copyright of the Charity Commission over the Tool must be recognised and the information or the Tool should not be presented in a way that is out of context or misleading. It also a condition of use that the Charity Commission is provided with a copy of the full final report. This will be provided in confidence and will not be shared with any person outside of the International Programme of the Charity Commission except with express permission.
How much will it cost to implement the Tool?
In short, it will vary. The first variable is the size and complexity of the NGO Sector and its regulatory framework. The resources needed to undertake an effective review will increase with the size and diversity of the sector, the complexity and number of laws and regulations and the availability of relevant information.
The second variable is the degree of accuracy required, Put simply, the greater the resource invested in the process, the better the result. Inevitably there will be a point where any extra investment is not justified by the small increase in accuracy that it brings. At the other end of the scale, it would be possible for an entirely desk-based assessment to be undertaken by one individual, provided that they had an understanding of the sector and its regulation and could access the information they needed.
Similarly, it would be possible – though not advisable - to undertake Parts One, Two or Three as stand alone exercises. To gain the maximum benefit from the Tool we recommend undertaking all four parts of the review in sequence.
Bearing all the above in mind, the following table is provided as an estimate of the possible resource implications for small, medium and large countries of a full assessment completed in line with the guidelines.
|
Part |
Estimate of working days required |
||
|
Small |
Medium |
Large |
|
|
One |
5 – 15 |
10 – 60 |
15 – 90 |
|
Two |
2 – 5 |
5 – 15 |
10 – 20 |
|
Three |
1 – 2 |
1 – 3 |
2 – 4 |
|
Four |
2 – 4 |
2 – 5 |
3 – 6 |
|
Total |
10 – 26 |
18 – 83 |
30 – 120 |