Who Are the Least Accountable Actors in the NGO World?
and what we can do about it
If a company makes a bad product, it tends to lose customers. If an NGO makes a bad product, hopefully it loses donors in the long term. But what if funders make bad grants? The least accountable actors in the NGO world are the funders themselves.
The least accountable actors in the NGO world are the funders themselves.
Part of this stems from the distance between funder and beneficiary. In the for-profit world, the person who receives the product is the one who purchases it, making feedback loops quick and tightly connected. It's far harder for funders to know what's happening on the ground, often thousands of miles and layers of bureaucracy away. Funders often recognize this as a problem, but how to solve it remains unclear.
Other funders? The most obvious choice might be peer funders—after all, they have power and face similar challenges. However, it's considered impolite to criticize other funders, and there's always the risk they'll simply decide to give less or become less transparent, making this a poor accountability mechanism. Plus, it would require deep knowledge of how others conduct their grantmaking, which funders typically don't have about each other.
NGOs? Perhaps NGOs could establish some sort of review system for funders. They have insider knowledge of how funders operate and what their processes entail. However, NGOs face significant potential ramifications for being critical and have clear biases regarding whom they'd critique. It would be difficult for an NGO to honestly give positive feedback about a funder that rejected them, and even harder to give negative feedback about one that funded them. Additionally, NGOs often prioritize criteria that differ from beneficiaries' priorities (e.g., whether the funder was polite during calls might matter to the NGO but rank low for beneficiaries).
Beneficiaries? In many ways, beneficiaries would be the ideal evaluators, making the system closer to the directness of the for-profit world. However, there are likely thousands of beneficiaries for every donor, most speaking different languages and lacking clear understanding of alternative options. Comparative surveys like this one can begin to address the challenge, but significant judgment calls remain in translating abstract beneficiary preferences into clear funder accountability—and who does that interpretation? This brings us back to other funders and NGOs.
Funds? A relatively new and innovative solution emerges from the concept of funds. I believe GiveWell is one of the most transparent and accountable funders, but why? Primarily because despite being a grantmaker, its funding ultimately depends on the judgment of individual donors. GiveWell operates as a charity evaluator, publishing its methodology publicly and maintaining a fund that supports these top charities. GiveWell is accountable to each donor who contributes to it—if GiveWell's research proves flawed, donors can simply redirect their giving to another fund or charity evaluator. Unlike larger funders who might need to dismiss dozens of staff to pivot, someone donating to GiveWell can change their donation within minutes to a different fund. This structure compels GiveWell to be far more transparent than virtually all private foundations—they almost have to be structurally, as transparency drives their growth and support.
Most private foundations have little interest in accepting external donations or expanding. Similarly, as long as core stakeholders remain satisfied, there are few ramifications for underperforming. But this doesn't have to be the status quo. Perhaps having grantmaking entities detached from specific individuals and instead evaluated by many individuals would allow the best to grow (as GiveWell has) and the worst to shrink. It's easy to imagine a world where donors could compare dozens of funds based on their desired ethical outcomes, and external fund evaluation is far less risky (and already reasonably common). I find this fund concept exciting for numerous reasons, but creating genuine accountability represents a significant potential benefit of this structure.