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The impact of grants’ capabilities on performance of local NGOs: Evidence from developing market

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This study aimed at assessing grants capacity and performance of local non-governmental organizations (NGOs) in Jordan. It also aimed to find answers to key research questions: How do grants’ capabilities affect the performance of local NGOs)? Can NGOs maintain peer connections with local actors? Finding out the impact of different grants’ capabilities on the performance of local NGOs in Jordan will allow updating and order to inform the capacity building programs that are provided to local NGOs in Jordan by various stakeholders. NGOs performance proxy developed through two bases: American Association of Retired Persons (AARP) & common performance. While, grants’ capabilities are measured through five dimensions: governance and humanitarian principles, human resources, financial and accounting practices, procurement practices, and programmatic and monitoring practices. Different methods (interviews, questionnaires, and focus groups discussions) were used to collect the data from 69 local NGOs. The sample represents six groups located in different geographical areas. The study result indicates that there is a significant impact of the governance and human resource capacities on the performance of local NGOs in Jordan; while, there is no significant impact of the remaining grants’ capabilities factors on the performance of local NGOs. Finally, the study outlined the main challenges that local NGOs in Jordan face regarding access to funds
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Corporate Governance and Organizational Behavior Review / Volume 6, Issue 4, Special Issue, 2022
295
THE IMPACT OF GRANTS’ CAPABILITIES
ON PERFORMANCE OF LOCAL NGOS:
EVIDENCE FROM DEVELOPING
MARKET
Jamal Abu-Serdaneh *, Anas Ghazalat **,
Ahmad Al-Ahmar ***, Emad Ahmed *
* Faculty of Business Studies, Arab Open University, Amman, Jordan
** Corresponding author, Faculty of Business Studies, Arab Open University, Amman, Jordan
Contact details: Faculty of Business Studies, Arab Open University, P. O. Box 1339, Amman 11953, Jordan
*** International Rescue Committee, Berlin, Germany
Abstract
How to cite this paper: Abu-Serdaneh, J.,
Ghazalat, A., Al-Ahmar, A., & Ahmed, E.
(2022). The impact of gr ants’ capabilities on
performance of local NGOs: Evidence from
developing market [Special issue].
Corporate Governance and Organizational
Behavior Review, 6(4), 295305.
https://doi.org/10.22495/cgobrv6i4sip10
Copyright © 2022 The Authors
This work is licensed under a Creative
Commons Attribution 4.0 International
License (CC BY 4.0).
https://creativecommons.org/licenses/by/
4.0/
ISSN Online: 2521-1889
ISSN Print: 2521-1870
Received: 02.06.2022
Accepted: 14.12.2022
JEL Classification: M20, P1, P17, M41, M49, L1
DOI: 10.22495/cgobrv6i4sip10
This study aimed at assessing grants capacity and performance of
local non-governmental organizations (NGOs) in Jordan. It also
aimed to find answers to key research questions: How do grants’
capabilities affect the performance of local NGOs)? Can NGOs
maintain peer connections with local actors? Finding out
the impact of different grants’ capabilities on the performance of
local NGOs in Jordan will allow updating and order to inform
the capacity building programs that are provided to local NGOs in
Jordan by various stakeholders. NGOs performance proxy
developed through two bases: American Association of Retired
Persons (AARP) & common performance. While, grants’ capabilities
are measured through five dimensions: governance and
humanitarian principles, human resources, financial and
accounting practices, procurement practices, and programmatic and
monitoring practices. Different methods (interviews, questionnaires,
and focus groups discussions) were used to collect the data from
69 local NGOs. The sample represents six groups located in
different geographical areas. The study result indicates that there
is a significant impact of the governance and human resource
capacities on the performance of local NGOs in Jordan; while, there
is no significant impact of the remaining grants’ capabilities
factors on the performance of local NGOs. Finally, the study
outlined the main challenges that local NGOs in Jordan face
regarding access to funds.
Keywords: Grant, NGOs, INGOs, Due Diligence, Civil Society, Jordan
Authors’ individual contribution: Conceptualization A.G.; Methodology
A.G.; Software A.A.-A.; Validation J.A.-S.; Formal Analysis
A.G.; Investigation A.G.; Resources A.G.; Data Curation A.A.-A.;
Writing Original Draft A.G. and A.A.-A.; Writing Review &
Editing A.G.; Visualization A.G.; Supervision J.A.-S. and E.A.;
Project Administration A.G.; Funding Acquisition E.A.
Declaration of conflicting interests: The Authors declare that there is no
conflict of interest.
1. INTRODUCTION
Civil society organizations (CSOs) and networks had
witnessed a dramatic growth and changes over
the last two decades as a result of the process of
democratization, technological information, and
economic liberalization. The diversity of
organizational types (e.g., transnational coalitions,
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296
international non-governmental organizations
(INGOs), global trade unions, community-based
initiatives) is supported by unprecedented
communication capacity via the Internet and global
media. They include social and political movements,
indigenous people’s groups, youth organizations,
women’s groups, environmental, human rights,
consumer groups, faith-based initiatives,
professional associations, t rade and industry
organizations, chambers of commerce, philanthropic
foundations, universities, policy think-tanks, and
scientific and research institutes. Those entities
work individually and collectively at all levels of
society. They have an impact on many aspects of
peoples’ lives ranging from their political and civil
rights to economic, social and cultural rights
(Nelson, 2007; Fifka, hn, Adaui, & Stiglbauer,
2016; Meaux et al., 2021).
In Jordan, the ro le of non-governmental
organizations (NGOs) is in constant increase. NGOs
in Jordan are aiming at helping and increasing
the well-being of the vulnerable groups in
the community by providing and implementing aid
programs in various aspects of t heir lives. Some of
these programs are: camp management and
coordination, health, water sanitation and hygiene
(WASH), food security and livelihoods (FSL),
protection, and education (Tabassum, 2012).
Jordan has been affected by different crises:
the Palestinian crisis in 1948, the Iraqi crisis in 2003,
and finally the Syrian crisis in 2011. All these crises
directly affected the economic, social,
demographical, and political environments in Jordan
and emphasized the crucial role that local NGOs
play in helping the Jordanian government to face
these crises and challenges. As a result of these
challenges, NGOs in Jordan have diversity in their
form, culture and structure.
International non-governmental organizations
in Jordan are trying to meet the needs of vulnerable
people in collaboration and coordination with local
NGOs. The relationship between INGOs and local
NGOs has different types, but when it comes to
grant/fund relationships, is called a partnership.
To build a partnership between INGOs and NGOs;
INGOs usually go through a due diligence process,
also called partner capacity assessment (PCA). This
process is varied between different INGOs but
shares the same concept and goals.
The due diligence process is a critical step in
getting the fund. In this step, INGOs aim to assess
the grant’s capabilities that local NGOs have to
evaluate their eligibility for fund reception. Many
barriers are facing local NGOs to pass this step and
get funded by INGOs. In this study, the researchers
aimed at exploring these barriers as a first objective.
Other objectives include investigating how grants
capabilities of local Jordanian NGOs can affect their
performance and how these capabilities could be
improved. Thus, the main objective of this study can
be summarized by investigating the impact of
the grants capabilities on the performance of local
NGOs in Jordan with the aim to provide stakeholders
in the field of NGOs in Jordan with guidance and
advice to improve the performance and grants’
capabilities of local NGOs.
This study contributes to the literature through
linking the acade mic literature on performance
measurement in the NGOs field with practical
concepts which are the grant capabilities and due
diligence process that are conducted by different
stakeholders in the field of NGOs in Jordan. As well
as, the research methodology that has been followed
was unique in the way of data collection; all
participants were provided with one-day training on
the study concepts which contributed to improving
the quality and reliability of the collected data.
Finally, geographical coverage: this study reached
out to a sample from different areas in Jordan;
North, Central, and South, which make it
geographically representative, since it counted for
70% of the total number of local NGOs in Jordan.
In addition, this study (according to the researcher’s
knowledge) is the first study that tests the impact of
the grants capabilities on the performance of
the local NGOs in Jordan and the region.
The study is organized as follows, Section 2 is
a review of literature and hypotheses development,
Section 3 research methodology that has been used
to conduct empirical research, and Sections 4, 5
and 6 presents the data analysis, discussion and
conclusion.
2. LITERATURE REVIEW AND HYPOTHESES
DEVELOPMENT
NGOs are considered independent from the public
and from for-profit sectors. They may ask for help
from these sectors to obtain resources (Salamon &
Anheier, 1992). Ramadan and Borgonovi (2015)
argued different definitions and frameworks of
performance measurement and management in the
NGOs sector. They pointed out a variety of
interpretations of the performance measurement
among NGOs, but also came to a summary of
the most mutual and agreed upon components that
have been addressed by the different actors
in the field of NGOs. Most of the existing
performance measurement frameworks highlighted
the programmatic indicators. Ramadan and
Borgonovi (2015) study stressed the importance of
encouraging researchers and NGOs’ actors to include
the organizational process, functions, and financial
aspects in the matrix and methodologies that are
used in the process of measuring the NGO’s
performance. However, due to their non-quantifiable
and multiple goals, these organizations’
performance is typically difficult to measure.
Strategic management, which is widely accepted as
a modern management tool for dealing with long-
term uncertainties, would provide significant
assistance to non-governmental organizations
(Aborass, 2021).
Carvalho (2005) pointed out that performance
can be measured through specific components:
human factors successful new approaches,
achievement of objectives, improving the well-being
of users, sustainability financial stability, success in
controlling costs, effectiveness in attracting
resources, quantitative analysis of revenues higher
than expenses, approved public funding and rising
of helped people, growth of revenues, volunteers,
and donors and sponsors.
In order to effectively mobilize for
the resolution of diverse social problems, a thriving
civil society is typically defined as overlapping
networks of autonomous volunteer associations
(Rodionov, Medeuov, & Rodionova, 2021).
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The argument is made that NGOs should work
together to maximize their limited resources and
broaden their reach into other social and political
milieus as well as their efficacy against their
opponents (Matthews, 2016).
Ferreira, Carvalho, and Teixeira (2017)
conducted interviews with three managers from
three different non-governmental development
organizations (NGDOs) and compared the annual
report of NGDOs for three different years from 2010
to 2012 to examine the possible existence of an
association between the fund sources and
organizational performance. They adopt three
dimensions for measuring the organization’s
performance (human co mponent, sustainability, and
quantitative component), and determined
the funding diversity through the annual report of
these organizations. They provide empirical
evidence for a positive association between
additional and greater funds on the organization’s
performance and found that the diversity of funds
plays a critical role in improving performance since
it reduces the independence of these organizations.
Moreover, NGOs and donors must collaborate
in a variety of ways, including finding reliable and
stable funding and involving the community in
decision-making processes, which will increase
the NGOs’ efficiency, performance, success, and
chances of remaining active and fully operational
(Tall, Matarneh, Sweis, Sweis, & AlBalkhy, 2021).
The diversity of funding is crucial for
the sustainability of any organization, affecting
organizational performance positively. The external
funds might bring a vast range of advantages like
stability, since some incentives endure over time,
needing only to communicate the intent of
the return to receive or renew itself automatically
contributing to a more positive performance of
the organization (Salamon & Anheier, 1997; Moon &
Jung, 2007; Lu, 2015; Shepherd, Williams, &
Patzelt, 2015).
Lewinsky (2015) and the International Council
of Voluntary Agencies (ICVA) conducted a study to
identify the different tools and methodologies of
PCA. Different funders and INGOs are used to assess
the grants capacity of the organization to evaluate
their ability to receive and manage the fund in
different contexts. The study found that INGOs need
to develop the capacity of local NGOs not just for
the purpose of delivering the projects’ output and
meeting the grants agreement obligation, but also to
help these organizations be able to access more
fund opportunities and to be mature as
organizations. Additionally, this study reported that
most of the used tools for PCAs driven by financial
and accountability measures with less focus on
the NGO’s performance. Where it gives the indicator
that the due diligence exercises conducted to meet
the funder’s intent of limiting the risks that are
associated with providing t he grants to local NGOs
and being more accountable to how the resources
are being managed, controlled, and spent. The study
also found that there is no clear correlation between
the lengthy partner assessments and the increased
quality of performance of the NGOs.
Lewinsky (2015) and Carter (2018)
recommended that the funder should not solely be
driven by finance and accounting, management, and
audit capacities, instead, it should give attention to
other essential areas such as the type of partnership
and how these partners could improve the role of
local NGOs. The funder is accountable to plan for
long-term partnerships for transformational change
beyond transactional service provision. This
approach will encourage the funder to put in
the required efforts to improve the performance of
the local and small NGOs beyond just adhering to
the funder’s requirements, rules, and regulations
and how this commitment is being reported back on.
However, Lewis (2003) conducted a study
aimed to improve the understanding of the nature of
NGO management as a field of research and practice
by establishing a conceptual framework. Lewis’s
(2003) study mentioned that improving
the performance of NGOs and raising their
effectiveness level should not be looked at based on
the assumption t hat NGO management practices
field is a standalone field, rather than it is
recommended to build on other fields of
management like generic manage ment, public
management and third sector one, keeping in mind
the distinctive aspects of NGOs.
The rationale behind encouraging the NGO
actor to build on what is existed in other
management fields has been presented by Lewis
(2003) as follows. First, generic management, which
exists in any organization and is driven by the main
management principles like the fact that any NGO is
in need for having an accounting system and
recruitment one, most of these practices a nd
researches are being developed in a business field.
Second, the third sector management, it is known
that the third sector organizations have unique
attributes that could not be met in ge neric
management, such as volunteer involvement and
fundraising strategies. Third, NGOs are sharing
many principles with public management, such as
building an accountability mechanism, especially
those NGOs that are active in public services. Fourth,
is development management, which refers to
the learning practices that NGOs follow in the field
of poverty reduction. Lastly, findings refer that
many of the NGOs that are externally funded are
being directed by their funders to improve their
performance quality throughout improving their
organizational performance as a whole, not just
the capacities that are directly linked with, which
caused in some cases a resistance by NGO’s leaders
as it is perceived in the form of external obligation.
The Civil Society Index Analytical Report for
Jordan (CIVICUS, 2010) conducted a study to assess
the status of civil society in Jordan. The study
abided by the methodology which was designed by
CIVICUS (2010) and focused on five main
dimensions to measure different levels of civil
society’s status. This study highlighted some of
the strengths of the civil society in Jordan. Although
organizations are working in rural areas, there is
a good infrastructure, media, communication
capacity and there is a good degree of independence
in the financial and administrative manners with
various structures.
Also, some of the weaknesses have been
reported such as: civil society organizations are
working in a political and biased environment which
in turn affects negatively their impact. A poor
capacity of leadership and financial management
was documented especially in a transparent manner.
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Moreover, public confidence in CSOs has been
negatively affected by the perceptions of foreign
funding. This study calls to focus on empowering
the role and culture of voluntary work, emphasizing
a legal frame that governs voluntary work and
contributed to improving the efficiency and
effectiveness of voluntary work on the individual,
institutional and societal levels.
The debate regarding the NGOs and their
performance has not taken the appropriate space,
nor has it been discussed according to nature and
the characteristics of the sample in previous studies.
There are many approaches that are used to
measure performance in the field of NGOs and these
approaches are based on how researchers look at
the measurement process.
Performance measurement is the utilization of
objectives, indicators, and information to assess
NGOs’ interventions and services (Lindblad, 2006;
Savaş & Karakaş, 2019; Mamabolo & Myres, 2020).
Moreover, Ferreira and Otley (2009) treated
the performance measurement as a mechanism of
assessing people, tea ms, and the overall
organization, while Miller (2007) viewed
performance measurement as a progra m assessment
method that evaluates the efficiency and
effectiveness of a program and its impact.
According to the American Association of
Retired Persons (AARP), the performance
measurement concept is more effective under
the performance matrix to operationally define. This
matrix stated that the performance of NGOs could
be measured through four main areas: the inputs
which refer to the resources and stewardship,
the outcomes that are directly related to the people,
the outputs that address organizational leadership
and integration, and finally the impact tackles social
impact and value (Ramadan & Borgonovi, 2015;
Aboramadan & Borgonovi, 2016; Gunawan, Fiarni, &
Ryana, 2017). Accordingly, this study followed
the AARP performance matrix to define
the performance through four dimensions: resources
and stewardship (inputs), people (outcomes),
organizational leadership and integration (outputs),
social impact and value (impact).
Moreover, the grants refer to the Agreement
between local NGOs and INGO, in which INGO
provides financial and technical support to local
NGOs to implement an agreed project within
a specific timeline, scope, and budget. Thus,
the grant capabilities are being assessed by INGOs
through a due diligence process. Grants’ capabilities
are part of the organizational capacities and
functions, and it refers to the direct link between
the identified capabilities and the ability and
eligibility to receive a grant. In this study, five main
due diligence templates used by the INGOs in Jordan
have been reviewed. also, to consult some literature
that is tacking the due diligence exercise (Lewinsky,
2015). This review aimed to come up with five main
capabilities to be assessed under this research.
Those selected capabilities are governance and
humanitarian principles, human resources, financial
and accounting practices, procurement practices, and
programmatic and monitoring practices.
To achieve the study objectives and to provide
understanding of the impact of grants capabilities
that local NGOs have on its performance.
The following hypotheses are adopted:
H1: The different dimensions of grants
capabilities impact the performance of local NGOs in
Jordan.
There are sub-hypotheses as follows:
H1a: Governance and humanitarian principles
impact the performance of local NGOs in Jordan.
H1b: Human resources practices impact
the performance of local NGOs in Jordan.
H1c: Financial and accounting practices i mpact
the performance of local NGOs in Jordan.
H1d: Procurement practices i mpact
the performance of local NGOs in Jordan.
H1e: Programmatic and monitoring practices
impact the performance of local NGOs in Jordan.
3. RESEARCH METHODOLOGY
3.1. Population and sample selection
The population of this study was the local NGOs in
Jordan which have legal registration at the Ministry
of Social Development (MoSD) and active in relief
work in Jordan, t he population number as published
by the MoSD in Jordan is 1197. Figure 1 shows that
the high number of local NGOs in Jordan is located
in Amman with 34% which equals 410, Irbid
indicates 14% which equals 171 and Zarqa comes as
the third governorate in Jordan that has a high
number of NGOs with 10% that equal to 117.
Figure 1. Percentage of local NGOs in Jordan
Note: Developed by the researcher based on the publication by MoSD.
34%
14%
10%
9%
7%
6%
6%
4%
3% 3% 2% 2% Amman
Irbid
Zaarqa
Mafraq
Karak
Madaba
AL Balqa
Maan
Ajloun
Al Aqaba
Jarash
Tafila
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In this study, interviews with key informant
people from local NGOs, MoSD, and the Ministry of
Planning and International Cooperation (MoPIC) were
conducted to get a background on the main
attributes of the population study and to find a way
to reach the sample. The main output of these
interviews was the founding that there is
a coordination body that represents the population
called the General Union of voluntary societies in
Jordan, which has twelve groups, one at each
governorate in Jordan.
Given the fact that there is a high number of
local NGOs that are registered at MoSD while
the active number is small compared with the
registered gave a challenge for this study.
To overcome this challenge and to reach out for
the sample, coordination with the union’s groups
was a must. Their representatives have been asked
to nominate the active NGOs to be interviewed.
Thus, the sample under this study is considered
a judgment sample.
Due to the high study’s population and
the researcher’s capacities in terms of finances and
manpower, the researchers coordinated with
the union’s groups at each governorate to reach out
to the nominated sample, inform them about
the study and coordinate a meeting with them to
participate in the data collection stage. Six out of
twelve groups were responsive and willing to
facilitate the data collection process. 69 local NGOs
have participated in this research. These six groups
are located in different geographical areas, which
makes the sample geographically representative; in
the northern region at Irbid, in the middle region in
Amman, Zarqa and Madaba, in the southern region
in Aqaba and At-Tafilah.
3.2. Data collection method
During the instrument’s testing phase, it was
reported that a high percentage of participants are
not aware of the used terminologies, which makes it
difficult for them to answer accurately. Based on
that, it was recommended to follow administered
questionnaire method in collecting the data for
validity and reliability purposes.
In order to facilitate the data collection and
motivate the local NGO representatives to
participate in filling the research instrument,
one-day training was held for survey participants.
Training has been coordinated with the union’s
groups at each governorate, where the union groups’
representatives were responsible for inviting the
active local NGOs to the groups and handling all
logistic issues. 69 questionnaire tools have been
filled, and 105 participants have attended
the training. Collecting the data through the
personal administrated questionnaire, focus group
discussion (FGDs), and training methods have
a significant contribution to the validity and
reliability of the collected data.
3.3. Items measurement
According to Worth (2020), the majority of NGOs
have some sort of performance reporting system,
hence it may be assumed that these NGOs initially
measured their performance. Ebrahim (2010)
recognized accountability as the primary motivation
for performance measurement in NGOs while
LeRoux and Wright (2010) found the capacity
building to be the primary driver of this practice.
Others have hypothesized that mimetic
isomorphism is the reason why NGOs use
performance measuring systems that are quite
similar to those used in the corporate sector
(Tahajuddin, Hasan, & Kassim, 2021). According to
the idea of mimetic isomorphism, organizations that
are subject to societal pressure copy other, more
successful organizations in their surroundings.
However, a number of experts and professionals
who work for NGOs co ntradict the aforementioned
assertions and contend that, generally speaking,
NGOs monitor performance solely because donors
request it (Wadongo & Abdel-Kader, 2014). However,
there isn’t any concrete information on Jordanian
NGOs that can be compared to the perspective
surrounding this topic.
However, regarding prior facts and keeping in
mind that this research is focusing on INGOs as
a grantor and local NGOs as a receiver. This study
adopts a unique strategy in multi-stages to develop
the research’s instrument. First, a meeting was
initially organized with INGO staff in Jordan in
an attempt to find out more about the procedure
that INGOs follow to decide whether or not to award
a grant to a local NGO. Then, reviewing existing tools
and drafting the first research instrument’s version,
including two main areas: perfor mance
measurement and the grants capabilities. Then,
testing the first draft: the first draft has bee n tested
through three FGDs, at each focus group 79 local
NGOs’ representatives have participated .
Participants provided their notes and challenges that
they faced in filling out the draft version of
the instrument and their recommendations. Finally,
developing the final version: the instrument
has been updated based on the notes and
recommendations presented at the testing phase. Four
main modifications have been made to the first draft.
In this regard, this study considered
the performance of the local NGOs as a dependent
variable: 14 questions have been included in
the research’s instrument to measure this variable.
These questions we re developed on two bases. First,
the AARP performance matrix that is tackling four
main areas: inputs, outcomes, outputs, and impact
(Datar, Epstein, Leonard, & Goodwin, 2007). Second,
the common perfor mance questions that are used by
INGOs in the due diligence process to measure
the performance of local NGOs. Figure 2 shows
the study model that includes dimensions and
elements of NGO performance and grants
capabilities variables.
Moreover, grants capabilities refer to the ability
of the local NGOs to obtain and implement a grant
from INGOs. This study dealt with grants capabilities
as independent variables, and it has been measured
through five dimensions, which are considered
sub-independent variables that formulate together
the grant capability: governance and humanitarian
principles, human resources, financial and
accounting practices, procurement practices, and
programmatic and monitoring practices.
Governance and humanitarian principles: this
variable refers to the governance shape that the local
NGOs follow, such as board aspects, vision, mission
and strategy, and the awareness degree of
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the humanitarian principle at the local NGOs’ level.
Human resources: refers to the practices that local
NGOs follow in dealing with employees. Financial
and accounting practices: refers to the practices that
local NGOs fo llow in the field of financial and
accounting practices and that ensure all activities
and process in this field is well documented and
monitored in a timely manner with focusing on
guidelines, dealing with an auditor, using techniques
and transparency. Procurement practices: this
variable refers to the procurement practices that
local NGOs follow to ensure that procurement
activities are implemented in line with
the segregation of duty principles and follow certain
control mechanisms over the NGOs’ resources.
Programmatic and monitoring practices: refers to
the practices that are followed by local NGOs to
report and monitor the projects. Dimensions and
elements of NGO are shown in the figure below.
Figure 2. Dimensions and elements of NGO performance and grants capabilities variables
Note: Developed by the researchers based on the interviews with staff from INGOs.
4. DATA ANALYSIS
4.1. Sample’s characteristics
To obtain information about the characteristics of
the sample and their experiences with grants,
a questionnaire was used that included six
questions. The descriptive analysis of the answers to
each question is as follows:
1. Has your NGO ever received a grant or not?
This question is used to assess if the sample is
familiar with grants or not. The frequency of
the answers: 44 of the participated sample in this
study reported that they have received at least one
grant, whereas 25 have reported that they have not
ever received a grant. This provides evidence that
the sample is aware of the study field and they have
the required knowledge to participate.
2. What is the number of received grants?
28 out of those 44 organizations who answered that
they received a grant reported that they received
between 1 to 3 grants, followed by 8 reported that
they received between 46 grants, 4 received
between 79 grants, and finally 4 have received more
than 9 grants.
3. What is the average duration of grant
reception? 14 out of those 44 organizations reported
that the average duration per grant is between one
to three years, followed by 11 organizations that
reported their average duration of more than three
years. The duration between six months and one
year was reported by 10 organizations and the least
frequency was for the duration that less than six
months that being reported by 9 organizations.
4. What is the average volume of received
grants? 26 out of 44 reported the financial volume
between 10,00050,000 USD. Less than 10,000 USD
was reported by 11 organizations, 5 organizations
chose the value between 50,000150,000 USD and
just 2 organizations picked the value that is above
150,000 USD.
5. What are the donor types that NGOs work
with? 14 out of 44 local NGOs reported that they
received funds from governmental do nors, while
INGOs were reported as a source of funds by 8 local
NGOs, and local NGOs were also reported by
3 organizations as sources of funds. 19 organizations
reported that they receive funds from other sources.
6. When was the first grant received?
22 organizations out of 44 answered that they
received the first grant 5 years ago, while
10 organizations picked the answer between one
and three years. 8 organizations reported that
the first grant was received less than one year ago,
and just 4 organizations chose the option between
three and five years ago .
Governance and
humanitarian
principles
Human resources
Financial and
accounting
Procurement
Programmatic and
monitoring
Grants
capabilities
NGO
performance
Resources and
stewardship
(Inputs)
People (outcomes)
Organizational
leadership and
integration
(outputs)
Social impact
and value
(impact)
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4.2. Descriptive statistics
Under this research, the organizational performance
at local NGOs in Jordan has been assessed based on
the range from 14, while: number/option 1 refers
to weak performance; number/option 4 indicates
a very strong performance. The results, presented i n
Table 1, show a wide range of performance from
1 (weak) to 3.7 (strong). The mean equals 1.8, which
puts the performance of local NGO s in Jordan
between the weak and fair, nearer to the fair one.
As mentioned previously, the performance of
local NGOs has been measured against four main
areas: inputs, outcomes, outputs, and impact.
The mean of the questions that are testing these
areas indicated that: local NGOs have a fair social
impact with a 2.16 score, followed by fair inputs
with a 1.98 score. The outputs come at a third
degree with a 1.95 score, and finally, the outcomes
fall into a 1.90 score.
Table 1. Descriptive results
Variables
N
Min.
Mean
Std. dev.
Skewness
Kurtosis
Stat.
St. error
Stat.
St. error
Organizational performance
69
1.000
1.860
0.5283
1.119
0.289
1.618
0.570
Governance and humanitarian
principles
69
2.100
3.518
0.4173
-1.27
0.289
1.216
0.570
Human resources
69
1.000
2.389
0.6080
-0.400
0.289
-0.316
0.570
Financial and accounting
practices
69
1.600
3.046
0.4629
-0.964
0.289
1.392
0.570
Procurement practices
69
1.200
2.684
0.6813
-0.531
0.289
-0.672
0.570
Programmatic and monitoring
practices
69
1.500
2.898
0.5872
-0.464
0.289
-0.486
0.570
However, Table 1 shows that the governance
and humanitarian capabilities of local NGOs in
Jordan are varied with a minimum of 2.1 (fair) and
a maximum of 4 (very strong), the mean equals
3.5 (strong) which put the local NGOs in Jordan in
a level of having strong governance and
humanitarian capabilities. Human resources
capabilities come at a minimum of 1 (weak) and
a maximum of 3.6 (very strong), and human
resources mean is 2.3, which categorized the human
resources capabilities at local NGOs in Jordan as fair.
While the financial and accounting capability started
at a minimum of 1.6 (fair) to reach its maximum of
3.9 (very strong), the mean for finance capacity at
local NGOs in Jordan is considered strong where it
equals 3. Hence, the procurement capacity at local
NGOs in Jordan has a weak minimum of 1.2 and
a very strong maximum of 3.9 with a good mean of
2.6. The results in Table 1 document a minimum of
1.5 t he programmatic and monitoring capability at
local NGOs starts to reach its maximum of 3.9. Mean
equals 2.8, which classified the programmatic and
monitoring capability at local NGOs as good.
5. DISCUSSION
5.1. Correlation analysis
The validity and reliability are considered critical
indicators of the correlation analysis, where
the correlation results are built based on
the collected information on the characteristics
of the examined variables. These characteristics are
affected by the way and techniques that have been
followed and used to obtain these characteristics
(Williams, 2007; Pallant, 2020). However,
the correlation analysis (Table 2) was used in this
study to assess the impact of the independent
variable with its dimensions (grants capabilities) on
the dependent variable (organization performance).
Table 2. Spearman rank correlation
Organizational
performance
Governance and
humanitarian
principles
Human
resources
Financial and
accounting
practices
Procurement
practices
Programmatic
and monitoring
practices
Grants
capabilities
Corr. coeff.
1
0.399**
0.517**
0.194
0.127
0.142
0.395**
Sig. (2-tailed)
0.001
0
0.11
0.3
0.244
0.001
N
69
69
69
69
69
69
69
Note: Significant level ***, **, * = p-value < 1%, 5%, 10% respectively.
Table 2 shows there is a significant impact of
grants capabilities on the performances of local
NGOs in Jordan. Similarly, correlation analysis was
conducted between the performances of local NGOs
with each dimension of the grants capabilities and
found that there is a significant impact of
the governance and humanitarian principles and
human resources capability on the organizational
performance at the 0.01 level. However, the
insignificant impact of financial and accounting
practices, procurement practices, and programmatic
and monitoring practices on the organizational
performance in local NGOs in Jordan has been
documented.
5.2. Regression analysis
This research has computed the multiple regression
analyses to test to which extent the grants
capabilities of local NGOs impact local NGO s’
performance. This study provides an assumption
that there is no impact of the independent variables
(grants capabilities of local NGOs) on the dependent
variable (local NGOs’ performance). The independent
variable has five dimensions: each of them is
Corporate Governance and Organizational Behavior Review / Volume 6, Issue 4, Special Issue, 2022
302
considered as an independent variable,
the regression analyses are used to test the impact
of each dimension.
Based on multiple regression results presented
in Table 3, the calculated R-square showed that
the independent variables could interpret 38% of
the dependent variable. Also, Tables 3 and 4 indicate
that the model is accepted as F 2 (7.797), and
Durbin-Watson (DW) index was 1.541, which falls
within the range of 0 to 4, meaning that there is no
autocorrelation problem. Also, Table 3 shows that
no multicollinearity problem has existed among
the study variables in the multiple linear regression
models. Tolerance should be > 0.1 (or VIF < 10) for
all variables, which were within the accepted range.
All the above measures are considered within
the accepted range.
Table 3. Multiple regression analysis results
Variables
Beta
T
Sig.
Collinearity
statistics
Tolerance
VIF
(Constant)
-0.280
0.781
-
-
Governance and
humanitarian
principles
0.239
2.303
0.025
0.915
1.093
Human
resources
0.538
4.866
0.000
0.807
1.240
Financial and
accounting
practices
-0.077
-0.684
0.496
0.774
1.291
Procurement
practices
-0.064
-0.498
0.620
0.594
1.684
Programmatic
and monitoring
practices
0.088
0.745
0.459
0.702
1.425
R
0.616
R2
0.380
Adjusted R2
0.330
Durbin-Watson
1.541
Table 4. ANOVA
Model
Sum of
squares
df
Mean
square
F
Sig.
Regression
7.206
5
1.441
7.709
0.000*
Residual
11.778
63
0.187
Total
18.984
68
Note: Significant level ***, **, * = p-value < 1%, 5%, 10% respectively.
Consistent with the study expectations,
the governance and humanitarian principles have
a significant positive association with
the performance management of NGOs as presented
in Table 3 (T = 2.303, p-value = 0.025). Likewise,
human resources practices provide a high
significantly positive effect on the perfor mance
management of NGOs in the local Jordanian
environment (T = 4.866, p-value = 0.000). However,
the local NGOs’ representative has reported same
indications. Jordanian government has a strong
monitoring mechanism for NGOs’ work, especially
on the income sources, and all community members
who are active in humanitarian work should be
registered at the MoSD, since all local NGOs in
Jordan are requested and obliged by law to submit
annual reports. These are the main reasons for
the governance part. For human resources
dimension, local NGOs in Jordan count on
volunteers, where the financial sources are limited.
Most NGOs’ leaders reported that the number of
paid staff is limited, and there are a high number of
volunteers who are executing the needed work and
delivering the aid.
On the contrary, each of the financial and
accounting practices, the procurement practices, and
the progra mmatic and monitoring practices did not
significantly influence the performance management
of NGOs in the Jordanian environment.
Table 3 shows insignificantly association for
each dimensions (T = -0.684, p-value = 0.494;
T = -0.498, p-value = 0.620; T = 0.745, p-value = 0.459)
respectively. These results could be linked to
the size of local NGOs, where the finance,
procurement, and programing and monitoring
capacities are not reaching the level that allows them
to influence performance. Correspondingly, as
reported by the local NGOs’ representative, the work
environment of local NGOs in Jordan is affected by
the local culture, religion, and norms. This
confirmed that community members are focusing on
delivering aid to the needy people more than
adhering to the rules and regulations, and best
practices in the field of procurement, finance, and
programming. On the other hand, prior literature
mentioned that homophily is influenced by group
size; the larger a group, the simpler it is for its
members to develop homophilous intragroup ties;
whereas it can quickly form more cohesive relations
thanks to shared traits, backgrounds, and/or
experiences (Wimmer & Lewis, 2010; Rodionov
et al., 2021).
However, the descriptive results show a fair
awareness degree of the grants capabilities in
the selected sample. Also, the results indicated that
local NGOs in Jordan have weak to fair performance.
This supports what has been indicated by prior
literature (Simadi & Almomani, 2008) that clients
have fair satisfaction toward the services that are
provided by local NGOs in Jordan, and client
satisfaction has a direct link with performance. This
study found that a high number of local NGOs in
Jordan (84% ) have an annual budget that is less than
50,000 USD. This result supports t he results that are
published by the Registry of Societies1, which
indicated that the annual budget is less than
50,000 JOD for more than half of the local NGOs in
Jordan. However, this result is constant with prior
studies that concerned the NGOs in developing
markets, where studying NGOs in emerging
countries typically identifies the main sources of
funding by foreign help. In contrast with developed
countries, three main sources of funding dominated
by NGOs: contributions, grants and contracts from
the government, and generated income (Suárez &
Marshall, 2014; Suárez & Gugerty, 2016; Meaux et al.,
2021; Rodionov et al., 2021; Tall et al., 2021).
The most powerful NGOs receive funding from
sources outside of local civil society. Therefore, t hey
are not suffering from pressure to work with anyone
outside of what is required for their roles as grant
operators and/or training coordinators. This study
found that the income of local NGOs almost comes
from national sources, as 82% of NGOs reported that
the type of donor is national, governmental, local
NGOs, and others. This result also consists of
the result that is published by the Registry of
Societies in 2012, where it is indicated that 67 % of
the local NGOs are receiving their income from local
sources.
1 http://www.societies.gov.jo/Default/Ar
Corporate Governance and Organizational Behavior Review / Volume 6, Issue 4, Special Issue, 2022
303
6. CONCLUSION
Given that local NGOs operate in Jordan in a unique
environment that is affected by various indicators
such as the political, social, and eco nomic situation
of the neighbour countries, the population aspects
of Jordan, the culture, and religion dominate
the work and atmosphere of the NGOs.
This study introduced a new technique of
the data collection field that fits the culture in
the Middle East. As mentioned in the methodology,
training was developed to provide the study sample
with background information on the research topic
and ensure that accurate information is provided
by the participants. The training allowed
the researchers to mix different data collection
methods and overcome the challenge of sample
participation resistance. This study presented
the main challenges that are faced by local NGOs in
Jordan, which open the door for main stakeholders
like INGOs and MoSD to take their role in helping
local NGOs overcome these challenges.
NGOs field in Jordan is considered one of the
active employment fields where the number of
refugees that are hosted by the Jordanian
government is high. This encouraged the Jordanian
government to take a significant role in organizing
and leading the humanitarian work through
initiating, formulating, and expanding required
governmental bodies to serve this role and having
active coordination channels with INGOs, UN
agencies, and donors. The humanitarian field in
Jordan has been affected by the Syria crisis that
dramatically developed since 2011. Local NGOs in
Jordan are result oriented rather than process and
procedures; this has an impact on the way that local
NGOs deliver aid and impacted their performance.
Also, this study indicates that local NGOs in Jordan
are performing well and have a good understanding
and awareness of the grants concepts and the type
of actors that are active in the humanitarian field in
Jordan.
This study found that t here is a significant
impact of the governance and human resources
capacities that local NGOs in Jordan have on
performance, whereas the finance, procurement, and
programmatic and monitoring capacities have no
significant impact on the performance of local NGOs
in Jordan.
However, the results of this study are restricted
to some limitations. For instance , questionnaires and
focus group discussion methods are the only used
tools/approaches for data collection. This limited
the ability to use a case study method that might
help in testing how much the performance of NGO
could be affected by the deve lopment degree of
grants capacity at the same NGO. The data that is
being collected under this study is sensitive, and it
has bee n answered by the NGOs’ representatives
which might be biased in the favour of the local
NGOs by the respondents.
Regardless of the inherent limitations, this
study contributes to the literature through linking
the academic literature on performance
measurement in the NGOs field with practical
concepts, which are the grant capabilities and due
diligence process that are conducted by different
stakeholders in the field of NGOs in Jordan. As well
as, the research methodology that has been followed
was unique in the way of data collection; all
participants have been provided with one-day
training on study concepts which contributed to
improving the quality and reliability of the collected
data. To the researchers’ knowledge, it is the first
study that tests the impact of the grants capabilities
on the performance of the local NGOs in Jordan and
the region.
Finally, according to study results and
information received from different stakeholders
involved with the NGOs field, this study suggests
recommendations for three main stakeholders in the
field of humanitarian NGOs in Jordan. First, for local
NGOs’ leaders and representatives, it is very
important to improve the coordination between local
NGOs and activate the current local NGOs networks,
such as the General Union of Voluntary Societies.
Second, the INGOs have to design capacity building
programs that are building the organizational
capacity of local NGOs rather than operational ones
focusing o n improving the delivery methods and
providing clear training and guidelines for local
NGOs on how to have access to grants opportunities
that INGO offer. Third, the local authorities in
Jordan have to encourage open discussions with
local NGO members and provide solutions for
the challenges that limit local NGOs from obtaining
the required permissions.
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