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The New NGO C-Suite: Unlocking Efficiency, Control and Transparency Forward-thinking beneficiary organisations are replacing cumbersome cash and paper-based payments with electronic transactions, even in the remote under-banked regions of emerging markets.

The New NGO C-Suite: Unlocking Efficiency, Control and Transparency

by Geoffrey Gursel, Director and Head of Sub-Saharan Africa Treasury & Trade Solutions Sales, and John B. Finnigan, Head of Development Organizations, Corporate and Investment Banking, Citi

The New NGO C-Suite - image

A new breed of executives has infiltrated the executive offices and finance departments of humanitarian and social aid organisations in recent years. Fondly referred to as ‘bridgers’, they are managers who have migrated from the world of profit-driven enterprises to the not-for-profit universe of NGOs and similar entities. These managers typically bring with them insights into advanced financial and cash management practices that transcend operating differences between the workplaces they’ve left behind and the ones they’ve joined.

Their motives for shifting vary. Some are driven by situational events such as 9/11 or the fallout of a global financial downturn. Others have chosen to transfer strategic and managerial skills honed during successful careers in the corporate world to social causes that are important to them.

Calls for accountability

Whatever their reasons for change these executives often find that the pressures of meeting earnings and shareholder expectations are replaced by the financial expectations of a new set of stakeholders. These include aid donors who want assurances that their financial contributions are used wisely and responsibly. Whether these donors are government agencies, private corporations, or philanthropic foundations, they typically seek accountability and transparency into how the funds they provide are disbursed, tracked and managed.

In fact, these days it is rare to find an aid donor that is willing to extend no-strings-attached funding. Whether their donations are measured in thousands or millions of dollars, donors expect specific goals and expectations to be met and are willing to delve into the details of how their funds are used both in the field and at headquarters. They want to know that processes and technologies are in place to account for every dollar to minimise financial risks and to optimise benefits to aid recipients.

In response, forward-thinking beneficiary organisations are finding new ways to disburse and manage their funds. Taking cues from their for-profit counterparts, they are replacing cumbersome cash and paper-based payments with electronic transactions, even in the remote under-banked regions of emerging markets. They are adopting more sophisticated foreign exchange practices and embracing advanced electronic banking and reporting systems.

Mobilising field operations

In recent years, mobile phone technologies have had a huge impact on how major humanitarian and development organisations conduct their business, particularly in far-flung corners of the world. Take for instance one international health organisation that leveraged the advanced state of mobile communications networks in Africa to transform activities as diverse as how it tracks and treats malaria to how it manages local cash disbursements.

A specialised mobile phone interface provides health officials in local communities a means of reporting data that is critical to identifying and responding to malaria infections in real time. Field operations use cell phones to quickly transmit information that provides insights into malaria burdens at the local level and drives faster, more targeted interventions.

Much of the organisation’s work is conducted in communities with little or no formal banking services and where, historically, local payments have been cash-based. Today, thanks to the development of mobile payment capabilities in a growing number of developing countries, field workers can receive funds quickly and securely via their mobile phones to meet local administrative and operating needs.

Changing the financial paradigm

Mobile network operators, recognising a chance to change the financial paradigm in countries such as Kenya, have been joining forces with banks and non-bank local agents to create mobile payment services for unbanked and under-banked populations. Kenya, a pioneer in mobile payments, can now lay claim to one of the most sophisticated mobile payment systems in the world as the majority of households in the country use mobile phones for funds transfers.

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