NGOs will be slow to address global corruption risk

Subject

Corruption in the aid industry.

Significance

The publication of the Aid Transparency Index on April 13 has drawn attention to weaknesses in the governance of aid organisations. Official development assistance reached 90 billion pounds (135 billion dollars) in 2014 and was supplemented by large amounts of voluntary donations. Much of this aid is distributed in contexts where corruption is rife, raising risks for agencies that they will become involved in damaging scandals.

Impacts

• The public will pressure aid agencies to demonstrate that funds are well-spent and cannot be siphoned off by local elites for private gain.
• Corruption scandals are making it more difficult for charities and NGOs to raise money from the public.
• Clear governance structures for mitigating corruption risk would help reduce the potential for fraud in NGOs.