Will NGOs Replace States as the World’s Problem Solvers?
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Unless a structural and ideological shift happens, this won’t be possible.
Wouldn’t it be great if NGOs and International Organisations (IOs) such as the UN could replace states in solving global problems?
In an ideal world, independent organisations would work with a victim-oriented approach, helping those in need, rather than working to further their own political aims.
Unfortunately, the positioning of NGOs and international organisations within the world, and their institutional set-up makes it nearly impossible for them to replace states as the world’s problem solvers.
In order for this to happen, we need both:
- a structural shift in the positioning of IOs and NGOs in the global order
- an ideological shift around the role of NGOs in knowledge production
Structural dynamics of the transnational world
In The NGO Scramble, Alexander Cooley and James Ron convincingly discuss structural mechanisms that prevent NGOs and IOs from effectively addressing global problems. The most important is this one:
Market pressures → dysfunctional and opportunistic behaviour
It’s nice to think of the rosy image of NGOs and IOs — such as Amnesty International, the Red Cross and Crescent, and the United Nations — as organisations that work for the interests of the victims, putting them first.
Not only is this not always the case, this also isn’t always possible.
Once an organisation enters the transnational field, it’s involuntarily subjected to market pressures and is forced to compete to survive.
Survival, not helping the victims, becomes a primary driving force behind NGO work.
NGOs and IOs compete for money from funding organisations and states. They sell their services — and what their programmes will involve — to those willing to pay.
Although the norms and values of civil society and its victims do play a role in the development of NGO programmes, more often than not the decision-making process is affected by organisational insecurity, competitive pressures, and fiscal uncertainty.
This isn’t specifically the fault of NGOs and IOs: the transnational structure they’re operating in just doesn’t lend itself to organisations following a victim-oriented approach: it lends itself to competition to fill in funding checklists.
This approach ends up wasting money by prolonging inappropriate aid projects. Market-reactionary incentives often lead to aid work being insufficient, irrelevant and inadequate when it comes to providing solutions.
Market-reactionary incentives often lead to aid work being insufficient, irrelevant and inadequate when it comes to providing solutions.
Aren’t states subject to the same pressures?
They’re not. There’s one very big, key difference between states and NGOs:
The success of a state in foreign aid or development work is not crucial for its survival, the way it is for an NGO or IO set up for this purpose.
Secondly, unlike NGOs, states don’t compete for who receives their aid. IOs are set up to allocate these resources: for example, the UNHCR manages the distribution of refugee aid. So states don’t compete with each other in this area the way NGOs do.
This isn’t to say that NGOs can’t fix global problems. But the competitive pressures they’re under means their programme and strategy development has to be influenced by a race for survival, which affects the effectiveness of their projects, whereas this is not the case for states working in the sector.
Let’s turn to take a look at the structures of NGOs and IOs themselves, to pinpoint exactly where the problem lies.
Structural set-up of IOs and NGOs
Exploring Agency Theory, Daniel Nielson and Michael Tierney highlight 3 important ways that states stay in control of NGOs and international organisations. Before we delve into them though, it’s key to know that NGOs and IOs largely aren’t independent: states are responsible for staff selection, monitoring, procedural checks, and contracts.
At the implementation level, NGOs and IOs do their own hiring, but at the decision-making level, they can’t do this independently from their donor states. Otherwise — no money equals not being able to operate.
Principal-Agency model
Nielson and Tierney propose a model wherein states who have control over international institutions, for example through providing funding, are “principals” and the organisations are “agents”. Nielson and Tierney think it’s possible within this model for NGOs to have genuine decision-making authority.
If this is true, then it would be possible to say that NGOs could have a chance at replacing states as the world’s problem solvers. If not, however, then they would remain dependent on states, so they could be a tool to address global problems, but can’t replace states.
Let’s have a look at some ways that NGOs and IOs can be independent of their ‘principals’:
- NGOs and IOs can hide information, and conceal their actions from states
- The long chain of communication between states and individuals in an IO or NGO can make it difficult for the state to actually control what happens, and what gets lost in communication
- The Maddison’s Dilemma: Delegating power to agents might actually empower them to act against the state’s wishes
I would love to keep taking this article down this direction, but unfortunately, it’s just not realistic. Even if these factors mean that NGOs and IOs can sometimes act independently, the fact of the matter is that they are still resource-dependent.
They can’t survive without the resources they get from states. So even if they can get away with a thing or two that their donors don’t want, NGOs couldn’t get their own way if the state actively disagreed with them.
Nielson and Tierney’s study shows that pressure from principals often leads to significant institutional reforms within NGOs, particularly when states threaten to re-contract with the agents and withdraw financial support.
This is made even more dire by the fact that the US alone is the major financial sponsor of the majority of Multilateral Development Banks (MDBs), and has disproportionate influence over the policies of these banks.
Even if they can get away with a thing or two that their donors don’t want, NGOs couldn’t get their own way if the state actively disagreed with them.
Can NGOs and IOs liberate themselves from state control?
It’s certainly possible. If NGOs can act independently, and the major obstacle is resource-dependency — how would things look if the resource challenge was fixed?
NGOs and IOs can seek other forms of funding
NGOs and IOs can stop relying on state funding, and instead rely on religious-based organisations, large foundations such as the Bill and Melinda Gates Foundation, and individual high net worth philanthropists.
But that’s not enough…
Unfortunately, money is only part of the story. Since the 1970s, US contribution to Multilateral Development Banks has decreased but their influence has increased.
Although it’s the largest financial donor overall, that’s not the case in individual cases. Japan is the biggest financial contributor to the Asian Development Bank, but the US still has the largest voting share.
Since the 1970s, US contribution to Multilateral Development Banks has decreased but their influence has increased.
The complete lack of equality of this is starkly evident. As well as that, it shows that even if NGOs and IOs did seek alternative sources of funding, this wouldn’t necessarily get rid of state control.
We need an ideological shift in knowledge creation
Discounting the effect of financial resources, the policies of Multilateral Development Banks and other international development organisations are largely determined by US academic thought and knowledge emanating from US policy reports and think tanks.
Even if state funding stopped completely, the decision-making of international organisations is largely based on research from the US and its allies.
This means that even if non-state actors can substitute for states in addressing global problems on the implementation level, states would still control the decision-making level.
So, what’s the solution?
If you’ve read my work before, you know I don’t like to leave things on a negative note. Assuming we value independent organisations dealing with global problems, here’s what needs to change for that to happen.
First, a recap:
- The saturated and competitive environment of the transnational field means independent non-state actors would be less effective on focusing on global problems. So if we want to maximise effectiveness, they shouldn’t completely replace states on the implementation level
- The dependency of NGOs and IOs on state resources and knowledge production means they can’t be fully independent of states, neither in terms of implementation nor in terms of decision-making. Since they can’t be independent, they can only at best act in conjunction with states, but they can’t replace them.
We would see a drastic shift in the development field if NGOs and IOs could replace states in addressing global problems.
What needs to change:
Assuming that states want to further their own interests, but non-state actors have the potential to be victim-oriented and politically independent, we would see a drastic shift in the development field if NGOs and IOs could replace states in addressing global problems.
NGOs and IOs need to respond to the needs of the developing communities that they’re helping, not the needs of the developed states that are funding them.
For that to happen, this is what needs to change:
1- NGOs and IOs need to play a more active role in knowledge and norm creation.
Amnesty International and Human Rights Watch are already beginning to gain credibility on development matters around the world, but it’s nowhere near enough. The International Committee of the Red Cross has pretty much set the global standard for humanitarian work, and this is the example we need to be seeing more of.
The Universal Declaration of Human Rights is a very unique document that was developed through cooperation from large and small states alike, as well as a sample of NGOs, and sets the global norms for human rights.
These examples need to continue. NGOs and IOs need to become more active in generating knowledge and norms, rather than responding to knowledge produced by states.
Why? Because they’re more cooperative and representative: rather than representing the interests of one state, they represent this interests of a group of actors.
2- NGOs and IOs need sources of funding external to the state.
This has to be a priority if NGOs and IOs want to act consistently outside of state control. Although, as we’ve established, money isn’t everything, states simply do not continue to financially support organisations they disagree with.
Particularly in the field of development, NGOs and IOs need to respond to the needs of the developing communities that they’re helping, not the needs of the developed states that are funding them.
3- NGOs and IOs need to actively work to reduce the competitive market environment of the transnational field.
They can do this by forming coalitions or agreeing to pool resources. However it’s done, these options need to be considered if NGOs and IOs hope to represent a viable, more effective alternative to states in addressing global problems.
Have a different perspective? I’d love to hear your thoughts.
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