By John McGee
Recently, there has been a spate of initiatives designed at improving organizations ability to enhance their internal controls and improve institutional credibility and transparency.
Independent Sector, the Council of Foundations and Grantmakers for Effective Organizations are among the most active organizations in this effort.
I applaud their efforts. However, as an executive of small regional nonprofit providing direct services to our community, I feel left out.
Who is ensuring that my organization does or should meet the same standards?
Why should these efforts only affect the “big boys”?
Are small and mid-size organizations not vulnerable to the same shortcomings?
Should they also not act in a way to protect the industry?
It is the small community-based organizations with finite resources providing the services, expending public and private resources and needing management expertise that may be at greatest risk of deviating from the accountability standards, not because they want to, but because they lack the time, resources and personnel to establish and monitor such controls.
I, therefore, submit the following modest proposal in an effort to make this effort more universal:
As a precondition to awarding a grant, grantmaking organizations utilizing regional associations of grantmakers, or RAGS, should require an organization to undergo an internal controls and governance audit.
The RAGs could hire or contract with individuals trained in conducting approved audits, thus reducing the costs to all concern.
Agencies passing or meeting all the audit requirements would receive their award outright. This would provide some assurance to the grantmaking agencies that accountability and transparency followed their awards.
Agencies found deficient in segments of the audit could be encouraged by the granting agency to bring their operation into compliance. A deficient audit should not prevent an agency from receiving their award but should but it on notice that the self-regulation process has found them wanting.
If adopted, I understand this will not solve all problems but it will be a start.
John C. McGee is executive director of the Family Relations Program in Gainesville, Ga.