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Abstract

Why do some nonprofits signal their respect for accountability via unilateral website disclosures? We develop an Accountability Index to examine the websites of 200 U.S. nonprofits ranked in the Chronicle of Philanthropy’s 2010 “Philanthropy 400.” Our intuition is that nonprofits recognize that the “non-distributional constraint” by itself may not generate sufficient trust. We expect nonprofits’ incentives for website disclosures will be shaped by their organizational and sectoral characteristics. Our analyses suggest that nonprofits appearing frequently in newspapers disclose more accountability information while nonprofits larger in size disclose less. Religion-related nonprofits tend to disclose less information, suggesting that religious bonding enhances trust and reduces incentives for self-disclosure. Nonprofits in the health sector disclose less information, arguably because governmental regulations in which they are embedded reduce marginal benefits from voluntary disclosures. Education nonprofits, on the other hand, tend to disclose more accountability information perhaps because they supply credence goods.

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... Boire and Prakash [16] proposed a non-profit accountability index to analyze the accountability practices followed by NGOs working in the United States. They [16] argued that the index they proposed covered the three important types of accountability, as defined by Ebrahim [6]. ...
... Boire and Prakash [16] proposed a non-profit accountability index to analyze the accountability practices followed by NGOs working in the United States. They [16] argued that the index they proposed covered the three important types of accountability, as defined by Ebrahim [6]. The various dimensions Boire and Prakash [16] used to construct the index are: (a) Beneficiary responsibility; (b) Codes and standards; (c) Employment responsibility; (d) Environmental responsibility; (e) Financial responsibility towards donors; (f) Public responsibility; and (g) Supplier responsibility. ...
... They [16] argued that the index they proposed covered the three important types of accountability, as defined by Ebrahim [6]. The various dimensions Boire and Prakash [16] used to construct the index are: (a) Beneficiary responsibility; (b) Codes and standards; (c) Employment responsibility; (d) Environmental responsibility; (e) Financial responsibility towards donors; (f) Public responsibility; and (g) Supplier responsibility. ...
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Website of Non-governmental organization (NGO) is a focal medium of sharing information in response to transparency demands and addressing trust deficits between stakeholders. Many researchers have proposed accountability approaches to measure information sharing trends through websites. This article discusses a new index to measure online disclosure trends along with the theoretical properties of the index and a practical application of data from NGOs working in Pakistan. The websites have been coded in 2016. Results show that NGOs with branch offices have better disclosure scores than single-office NGOs, and international NGOs score better than local NGOs. NGOs that are more often the subject of newspaper reports have better disclosure trends.
... 4 Despite the potential positive benefits of web disclosure, there is surprising variation in the level and quality of web disclosure adoption across the nonprofit sector. 4,8,9,[13][14][15] NPOs are a critical component of the economic, social, and political fabric of the American society. 16 In 2012, there were approximately 1.44 million NPOs registered with the Internal Revenue Service (IRS). ...
... Over the past decade, there has been increased interest on web disclosure among lawmakers U.S. 30 , researchers 4,7,9,[11][12][13] , and watchdog organizations. 31 Web disclosure principles and best practices were first promulgated by the U.S. Senate Finance Committee in 2004 in response to high profile public scandals by NPOs, and the subsequent precipitous decline in public confidence and trust in the nonprofit sector. 2 In order to strengthen the state of governance, transparency, and accountability in the nonprofit sector, the U. S. Senate Finance Committee U.S. 30 , Internal Revenue Service 32 , the Panel on the Nonprofit Sector Panel on the Nonprofit 33 , and GuideStar 31 recommended the voluntary adoption of web disclosure principles and best practices. ...
... First, web disclosure enhances public confidence and trust by disclosing information that demonstrates that the organization is operating efficiently and effectively. 7,9,13 In addition, organizations that disclose their information online increase their ratings on watchdog organizations such as Charity Navigator and GuideStar, which also increases the organizations credibility and legitimacy. Furthermore, organizations that disclose their information on their own website are able to reduce operating expenses by eliminating the need for staff to respond to requests for information through traditional paper-based processes. ...
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Nonprofit organizations (NPOs) are strategically using their own personal website to present themselves to the public and share information. Despite the potential benefits of enhanced public confidence and trust, reduced operating costs, improved donor decision making, and increased donations, many nonprofit organizations have resisted the adoption of web disclosure. Informed by the literature on information systems (IS) adoption and technological innovation, this study examines the primary factors that influence the adoption and resistance of web disclosure. Our sample consisted of 176 survey responses from an initial group of 3,323 U.S. NPOs. The statistical results indicate that attitude toward disclosure, compatibility of disclosure with current practices, and financial readiness have a positive influence on web disclosure adoption. The findings have implications for research and practice.
... IPSS are collective, non-profit entities, established on the initiative of private individuals, in order to give organized expression to the moral duty of justice and solidarity, contributing to the effectiveness of citizens' social rights, provided they are not administered by the State or other public body (Decree-Law no. 172-A/14) [28] (Decree-Law no. 172-A/14 consulted at https://dre.pt/dre/legislacao-consolidada/decreto-lei/2014-69878914 on 2 December 2021 ). ...
... Accountability is a multidimensional concept that includes providing information, in a transparent manner, enabling stakeholder participation, evaluating performance, and responding to stakeholder concerns (e.g., Tremblay-Boire and Prakash, 2015 [28]; Baur and Schmitz, 2012[38]). ...
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The development of the non-profit sector (NPS) in Portugal has been gaining relevance in recent times, particularly in the form of institutions whose purpose is to broaden and increase the response to the needs of the most needy and socially vulnerable citizens. The financing of Portuguese non-profit sector entities is essentially made up of income from their activity, donations and public or governmental support. Therefore, these entities face increasing pressure from their funders, users and citizens in general for a greater dissemination of good practices regarding the social impact they have on the community; in particular, they are increasingly required to be transparent in their activities. The main objective of this study was to analyse the level of accountability and transparency of the private social solidarity institutions (IPSS) of the municipality of Porto. To this end, the websites of these institutions were analysed, using a qualitative and quantitative methodology, using the application of the transparency index Enhancement of an Accountability Guide for Learning E-Government, proposed by Santos, Ferreira, Marques and Azevedo (2018). This analysis allowed us to verify that there are still a considerable number of entities that do not have an institutional website, and those that do, have a low level of transparency.
... The website of an organisation is an instrument allowing reducing the asymmetry of information, voluntarily supplying information to any interested individual about the organisation's activities as well as demonstrating confidence and readiness for external control (Tremblay-Boire & Prakash, 2015). In some European countries, for example, in Poland, PBOs are obliged to publish both their annual financial reports and their performance reports on their websites. ...
... However, in the countries where no such an obligation has been imposed, information disclosure or undisclosed is a free choice of the organisation. As proved by some research investigations in Europe and America, the voluntary initiative to publish a financial report or disclose other financial information is quite low (Tremblay-Boire & Prakash, 2015;Striebing, 2017). ...
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Research purpose. The aim of the research is to assess the transparency of financial performance of public benefit organisations (PBOs). Methodology. To achieve the aim and to accomplish the tasks set, general-scientific methods were used: the monographic method, the method of document analysis and the graphical method. A statistical analysis method – descriptive statistics – and a sociological research method – surveying – were used as well. Findings. Since 1 October 2014 when the Public Benefit Organisation Law came into force in Latvia, the number of PBOs has been increasing every year. On 1 January 2018, the number of organisations with valid PBO status had reached 2,775. To get an insight into the opinions of Latvian PBOs on the disclosure of financial information, a questionnaire was developed. The survey was attended by 201 respondents. The questionnaires revealed that 64.68 percent of the respondent organisations had a website or a web page on a social network, although only 21.89 percent of these respondents' websites contained some sort of financial information. In parallel with the PBO survey, a society survey was conducted to get an overview of the public opinions about the need to make PBO financial information freely available. The survey was attended by 116 respondents. The results indicated that although the PBO attitude to the disclosure of financial information was considered to be reserved, the public saw the need for such information. In view of the insufficient availability of financial information in the country and the low activity of PBOs themselves in voluntarily disclosing their financial information on their websites, it is necessary to carry out activities that supplement free-access information resources and/or motivate the organisations themselves to provide free access to such information. Practical implications. Based on the experience of other European countries, the Ministry of Finance has to consider amending the PBO Law to oblige PBOs to publish their annual financial and performance reports on their websites or in an equivalent way, thereby contributing to the transparency and accountability of the PBOs towards the society.
... Realizing the importance of the internet as an online tool for dissemination of information, researchers have designed indices to monitor the quality of information shared online by the NGO. Boire and Prakash [20] designed a 7-dimensional accountability index that can be used to evaluate the online disclosure practices followed by the NGO working in the USA. The aforementioned dimensions are as follows: beneficiary responsibility (4 elements), codes and standards (6 elements), employment responsibility (5 elements), environmental responsibility (4 elements), financial responsibility towards donors (10 elements), public responsibility (6 elements), and supplier responsibility (4 elements). ...
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The need for and benefits of proactive and transparent communication about corporate social responsibility (CSR) are widely acknowledged. This study examines CSR communication undertaken by the top 100 information technology (IT) companies in India on their corporate Web sites, with an analytical focus on the dimensions of prominence of communication, extent of information, and style of presentation. The findings indicate that the number of companies with CSR information on their Web sites is strikingly low and that these leading companies do not leverage the Web sites to their advantage in terms of the quantity and style of CSR communication. Although the findings do not necessarily imply absence of CSR action on the part of IT companies in India, they attest to a general lack of proactive CSR communication. The article concludes with managerial implications for CSR communication on corporate Web sites.
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This article examines the effects of three major revenue strategies in nonprofit organizations. Evolving resource dependence is demonstrated by the shifting reliance on each source of funds: private contributions, government funding, and commercial activities. A wide-ranging literature review is condensed into summary profiles comparing revenue volatility, goal displacement, process, and structure effects of each strategy. The profiles are drawn upon to anticipate potential advantages and disadvantages of increasingly diversified revenue strategies employed by nonprofits to combat resource dependence. The potential interaction effects raise critical but unanswered questions about nonprofit performance, legitimacy, and public policy issues.
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Scholars have often remarked that Congress neglects its oversight responsibility. We argue that Congress does no such thing: what appears to be a neglect of oversight really is the rational preference for one form of oversight--which we call fire-alarm oversight--over another form--police-patrol oversight. Our analysis supports a somewhat neglected way of looking at the strategies by which legislators seek to achieve their goals.
Takes as its departure point the criticism of Guthrie and Parker by Arnold and the Tinker et al. critique of Gray et al. Following an extensive review of the corporate social reporting literature, its major theoretical preoccupations and empirical conclusions, attempts to re-examine the theoretical tensions that exist between “classical” political economy interpretations of social disclosure and those from more “bourgeois” perspectives. Argues that political economy, legitimacy theory and stakeholder theory need not be competitor theories but may, if analysed appropriately, be seen as alternative and mutually enriching theories from alternative levels of resolution. Offers evidence from 13 years of social disclosure by UK companies and attempts to interpret this from different levels of resolution. There is little doubt that social disclosure practice has changed dramatically in the period. The theoretical perspectives prove to offer different, but mutually enhancing, interpretations of these phenomena.
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This study identifies factors that influence all types of social disclosures. A sample of 150 annual reports from six European countries was examined using content analysis. The results indicate that company size, industrial grouping and country of domicile all influence corporate social reporting patterns. It was found that `super-large' companies are significantly more likely to disclose all types of corporate social information. Industry membership was found to be related to the decision to report environmental and some employee information, but not to ethical disclosures. In addition, while size and industry membership were important in all six countries, the amount and nature of information disclosed varies significantly across Europe. Whilst legitimacy theory can be employed to explain differences related to size and industry membership, an initial analysis indicates that the reasons for differences across countries are much more complex and we offer suggestions as to how these may be explored in further research.Copyright 1998 Academic Press Limited
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To evaluate the current status of communication and fundraising strategies on the Internet, a stratified random sample of the Chronicle of Philanthropy's Philanthropy 400 was content-analyzed in mid-January 2005. Web sites were coded on variables identified in practitioner and scholarly literature on issues of accountability, fundraising practices, and interactive communication strategies. Chi-square analysis found that the top nonprofit organizations included copies of their annual reports, organizational goals, and mission statements, while second-tier organizations were more likely to use a sales approach by using e-commerce technology and terminology to process online donations.
Article
The importance of non-profit organisations as providers of social services has grown in many countries during the past 15 to 20 years as governments have contracted out direct social service provision. Arguments in favour of social service provision by the non-profit sector can be grouped into three categories: effectiveness, cost and responsiveness to community needs – the last of which is the focus of this paper. If claims of greater responsiveness in non-profit organisations are valid, it might be expected that such responsiveness would be manifested in a high level of stakeholder awareness and engagement on the part of non-profit organisations. Stakeholder theory (developed in the for-profit sector) is used here in the case study of a small non-profit organisation, both to explore the issue of stakeholder awareness and engagement, and to test the applicability of stakeholder theory to the non-profit sector. Key findings of the study were: • Stakeholder theory could be meaningfully applied to the non-profit organisation under study. • The organisation had a strong sense of obligation to a number of groups it had identified as sharing its objectives, although the concept stakeholder was not used by the organisation. • It was possible to assess the organisation's level of responsiveness to the various stakeholder groups and the factors that impinged on this level of responsiveness. Implications for accountability in non-profit organisations are also addressed.
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In response to investors? and other stakeholders? concerns about corporate environmental policies, many firms are voluntarily increasing their level of environmental disclosure since there is a scarcity of alternative information sources. Using a cost-benefit framework, this study intends to identify determinants of corporate environmental reporting by Canadian firms subject to water pollution compliance regulations during the 1986-1993 period. Results suggest that information costs and a firm?s financial condition are key determinants of environmental disclosure. Firm size, the regulatory regime governing corporate disclosure, and industry, also contribute to explaining environmental disclosure.
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Increased prominence and greater influence expose international non-governmental development and environmental organizations (INGOs) to increased demands for accountability from a wide variety of stakeholders-donors, beneficiaries, staffs, and partners among others. This paper focuses on developing the concept of INGO accountability, first as an abstract concept and then as a strategic idea with very different implications for different INGO strategies. We examine those implications for INGOs that emphasize service delivery, capacity-building, and policy influence. We propose that INGOs committed to service delivery may owe more accountability to donors and service regulators; capacity-building INGOs may be particularly obligated to clients whose capacities are being enhanced; and policy influence INGOs may be especially accountable to political constituencies and to influence targets. INGOs that are expanding their activities to include new initiatives may need to reorganize their accountability systems to implement their strategies effectively.
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This article examines the relevance of technology, and particularly the Internet, for the improvement of accountability and transparency in nonprofit organizations. The novelty of our work regarding the previous empirical evidence resides in the fact that we have taken into account the means through which these organizations diffuse voluntary information. In this article, we have proposed a model of information disclosure for the Web sites of Spanish nongovernmental organizations for development (NGODs) that can serve as a guide for improving their informative transparency and their accountability. The empirical evidence obtained reveals that Spanish NGOD Web sites are primarily ornamental and that they should evolve toward an environment more informational and relational that allows the stakeholders to access relevant information ranging from the work being done and the use of the dispersed funds to the form in which the organization is governed. Our results have also confirmed that the disclosure levels are related to the amount of future donations received by the organization.
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In this article we examine how information problems can cause agency slippages and lead to governance failures in nonprofit organizations. Drawing on the principal–agent literature, we provide a theoretical account of an institutional mechanism, namely, voluntary regulation programs, to mitigate such slippages. These programs seek to impose obligations on their participants regarding internal governance and use of resources. By joining these programs, nonprofit organizations seek to differentiate themselves from nonparticipants and signal to their principals that they are deploying resources as per the organizational mandate. If principals are assured that agency slippages are lower in program participants, they might be more likely to provide the participants with resources to deliver goods and services to their target populations. However, regulatory programs for nonprofit organizations are of variable quality and, in some cases, could be designed to obscure rather than reveal information. We outline an analytical framework to differentiate the credible clubs from the “charity washes.” A focus on the institutional architecture of these programs can help to predict their efficacy in reducing agency problems.
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This article examines accountability processes in a nonprofit organization serving immigrants and refugees, with special attention to their impacts on mission-based activities. The research finds that upward accountability requirements of donors do not necessarily yield improved mission achievement, and practitioners thus have to navigate a complex environment of pressures. We identify a series of strategies that nonprofit executives and staff use to manage the tensions between upward accountability and mission: a prioritization of lateral accountability, staff empowerment through organizational slack, and a tight coupling of evaluation with job tasks. The findings suggest that funders and nonprofits might gain more from investing in internal grantee capacities for lateral communication and coordination than by soliciting more detailed reporting
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The annual Internal Revenue Service Form 990 tax filing is the principal disclosure mechanism for nonprofit organizations. Although considerable efforts have been made to improve the accuracy and accessibility of Form 990, questions remain as to whether this data source is the most desirable foundation for a system of nonprofit accountability. Taking a broad perspective on financial accountability, this article assesses not only the quality and availability of the financial data, but also the entire financial–reporting model. The article develops a framework for thinking critically about nonprofit financial accountability. After examining the current structure of nonprofit financial reporting and contrasting it with alternative systems developed for other industries, the article concludes with recommendations for reengineering nonprofit financial accountability.
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Whose ideas matter? And how do actors make them matter? Focusing on the strategic deployment of competing normative frameworks, that is, framing issues and grafting private agendas on policy debates, we examine the contentious politics of the contemporary international intellectual property rights regime. We compare the business victory in the establishment of the 1994 Agreement on Trade-Related Intellectual Property (TRIPS) in the World Trade Organization with the subsequent NGO campaign against enforcing TRIPS to ensure access to essential HIV/AIDS medicines. Our analysis challenges constructivist scholarship that emphasizes the distinction between various types of transnational networks based on instrumental versus normative orientations. We question the portrayal of business firms as strictly instrumental actors preoccupied with material concerns, and NGOs as motivated solely by principled, or non-material beliefs. Yet we also offer a friendly amendment to constructivism by demonstrating its applicability to the analysis of business. Treating the business and NGO networks as competing interest groups driven by their normative ideals and material concerns, we demonstrate that these networks' strategies and activities are remarkably similar.
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This article addresses the question of whether operational efficiency is recognized and rewarded by the private funders that support nonprofit organizations in fields ranging from education to social service to arts and beyond. Looking at the administrative efficiency and fundraising results of a large sample of nonprofit organizations over an 11-year period, we find that nonprofits that position themselves as cost efficient—reporting low administrative to total expense ratios—fared no better over time than less efficient appearing organizations in the market for individual, foundation, and corporate contributions. From this analysis, we suggest that economizing may not always be the best strategy in the nonprofit sector.
Purpose The purpose of this paper is to analyse the evolving nature of the accountability relationship between a group of Irish non‐governmental development organisations (NGDOs) and their primary governmental funder. Design/methodology/approach The examination is undertaken in the context of a unique funder‐led initiative to instil a broad social accountability focus among NGDOs while re‐orienting the NGDO‐funder accountability dynamic towards a partnership‐based approach – whereby the accountability entity would effectively be a supra‐organisation comprising the funder and the NGDOs. The empirical content of the paper is derived from a series of in‐depth interviews with senior individuals working within the Irish NGDO sector, along with a comprehensive analysis of documentary sources. Findings The partnership rhetoric central to promoting the enhanced focus on social accountability across the “virtual” accountability supra‐organisation has not been transformed into reality, and the NGDO‐funder accountability relationship within the supra‐organisation remains centred on control and justification. A lack of resources, organisational commitment, guidance, and expertise from the governmental funder has contributed to an attitude of scepticism among many NGDOs towards both the partnership rhetoric and the accompanying adoption of the central tenets of social accountability, particularly downward accountability to beneficiaries. Research limitations/implications The research is based on a detailed analysis in a specific context which may limit its wider applicability. Nevertheless, it adds insights to the developing academic literature on NGO accountability, with particular reference to their broader social accountabilities. Practical implications Although highly context‐specific, the findings of the study will be useful to researchers and policy makers interested in understanding how NGDO‐funder accountability relationships can move towards mutual accountability and genuine partnerships focused on promoting social accountability. Originality/value Very few in‐depth academic examinations of the evolving nature of NGDO‐funder accountability relationships in specific NGO contexts have emerged in the accountability literature. Many of the insights in this paper are derived from individuals inside organisations in the NGDO sector who are regularly addressing issues of accountability, both social and otherwise. This provides in‐depth, highly‐informed insider perspectives on the evolving nature of these relationships, especially in the context of attempts to promote more partnership‐based approaches to the delivery of development aid.
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This paper addresses the theoretical framework on corporate social reporting. Although that corporate social reporting has been analysed from different perspectives, legitmacy theory currently is the dominating perspective. Authors employing this framework suggest that social and environmental disclosures are responses to both public pressure and increased media attention resulting from major social incidents such as the Exxon Valdez oil spill and the chemical leak in Bhopal (India). More specifically, those authors argue that the increase in social disclosures represent a strategy to alter the public''s perception about the legitimacy of the organisation. Therefore, we suggest using corporate communication as an overarching framework to study corporate social reporting in which corporate image and corporate identity are central.