The INGO Problem | LSE International Development

“I left international aid… I found it increasingly difficult to reconcile my beliefs with working in an INGO. I am proud of what I led (trying to decolonise the sector) but quite cynical about my 30 years of involvement with INGOs.” – former CEO, INGO.

Peter is a former CEO of two well-known INGOs, someone I have occasionally approached for feedback in my current work focusing on locally led development. He recently messaged me to share where he was and why he had left. This is just a summary, but crucially his words are a damning indictment and echo much of what I heard while researching my recently published book, ‘the INGO Problem’.

INGOs were once the standard bearers for what was right in civil society and international development. Their importance grew after the Second World War, with further growth in the sector in the 1960s and 1970s, following the period of decolonization. Where governments were not always able to meet people’s needs, INGOs stepped in as service providers and advocates in the years that followed. Many grew exponentially in size, with the largest INGOs now generating revenues of over $1 billion a year, along with the influence and status that came with it.

But all is not well. In recent years, INGOs have been in the spotlight, and not for good reason. The sexual exploitation scandals that hit the headlines in 2018 were quickly followed by criticism of fundraising practices, and later a surge in accusations of racism and neo-colonialism when Black Lives Matter came to prominence shortly after.

This criticism was not new. My own personal first encounter with the sector was when I worked on a project in the late 1990s that sought to establish an International Humanitarian Ombudsman. This was my first role after graduating from what was then called ‘DESTIN’ – the Development Studies Institute at LSE. It was a proposed solution to the criticism of the sector that arose following the irregular response to the Rwandan genocide. The recommendation for an independent Ombudsman was never fully implemented and most of the challenges that the project sought to address at the time remained unanswered.

More than 20 years later, the COVID pandemic exposed the futility of “experts” flying around the world to “save” poor people. In fact, it showed that local actors were already doing the work. The crisis itself helped to amplify the voice of what is known as the #ShiftthePower movement, which represents local civil society actors coming together to demand a more equitable civil society, in which national and local CSOs have more power and resources in the overall system. They note that the vast majority of resources go to international civil society actors such as INGOs (around 90 – 93%), while most of the work on the ground is done by local groups.

Governments have long committed to directing a greater share of their funding to local actors, following the 2016 Grand Bargain Commitments. USAID, for example, has pledged that 25% of its funding should reach local CSOs by 2030. And OECD governments have also made large commitments to increasing local financing for development. Yet such commitments remain a goal rather than a reality. USAID has seen less than 7% reach local CSOs. And only 10% of funding from OECD DAC donors is given directly to local organizations.

INGOs, meanwhile, have attempted to respond to some of the concerns through ‘localization’ efforts, by improving partnerships or establishing national branches of their offices. But there has also been a backlash to this move, as many see it as a more cynical attempt to grow a new fundraising base. For example, national branches of INGOs are eligible for localized funding from USAID. Some have argued that these moves do not actually get closer to local communities, but instead further marginalize them, by stealing away their own limited sources of local funding. A now infamous open letter to INGOs cynically stated (with respect to localization) that “all of this weakens us locally. It keeps us in a master/servant relationship where we are constantly begging for grants from your institutions, while we ourselves are deprived of core funding.”

So, what’s next for INGOs? Perhaps surprisingly, despite the many criticisms that have emerged, most people I work with, including local CSOs, see a continued need for INGOs. This is reflected in a 2021 survey by the West Africa Civil Society Institute, conducted for the RINGO Project, a systems change project to ‘reimagine INGOs’. The majority of the 600-plus respondents said they wanted and needed INGOs, but found the relationships highly unequal. Eighty-four percent of respondents said they worked with INGOs, but 85% of them said they were not mutually beneficial.

The potential roles for INGOs have been articulated through the RINGO project and other recent initiatives, such as the Pledge for Change. The roles identified include investors, facilitators and advocates. Nevertheless, the INGO role will undoubtedly be smaller and more focused, doing more through networks and less through large competing brands. Moreover, the work on the ground should almost completely disappear. Their way of organising should include new inclusive governance structures with solidarity with local actors at their heart. Most INGOs started from a place of solidarity: can we get back to that?

Interestingly, both IRC and Save the Children recently announced mass layoffs, following a sharp expected decline in their revenues, which had increased significantly during the onset of the war in Ukraine. If they had instead tried to invest in local actors at the time, and even years before, rather than increasing their own staff and expenditure, this could have been avoided.

We still need globally connected civil societies like INGOs. They are an important counterbalance to states and the corporate sector. But it is clear that their current incarnation is no longer suited to the multiple and diffuse polycrises of the 21st century. Despite the slow pace of progress, locally led development or shifting power is not just a passing fad, it is here to stay. We need stronger local civil societies everywhere and this means sizing and adapting INGOs to meet these needs. This transformation requires a concerted effort by the broader system to change the incentives that keep them in their throne: donors, leaders and the demand of local actors can all contribute to this much-needed transformation.

The views expressed in this post are those of the author and do not in any way reflect the views of the International Development LSE blog or the London School of Economics and Political Science.

Featured Image: Practical Action Publishing