Non-governmental organization Non-governmental organization (NGO) is a term that has become widely accepted as referring to a legally constituted, non-governmental organization created by natural or legal persons with no participation or representation of any government. In the cases in which NGOs are funded totally or partially by governments, the NGO maintains its non-governmental status and excludes government representatives from membership in the organization.
Unlike the term intergovernmental organization, “non-governmental organization” is a term in general use but is not a legal definition. In many jurisdictions these types of organization are defined as “civil society organizations” or referred to by other names. History National NGOs go back to antiquity. International non-governmental organizations have a history dating back to at least 1839. [4] Rotary, later Rotary International, was founded in 1905. It has been estimated that by 1914 there were 1083 NGOs. 5] International NGOs were important in the anti-slavery movement and the movement for women’s suffrage, and reached a peak at the time of the World Disarmament Conference. [6] However, the phrase “non-governmental organization” only came into popular use with the establishment of the United Nations Organization in 1945 with provisions in Article 71 of Chapter 10 of the United Nations Charter[7] for a consultative role for organizations which are neither governments nor member states—see Consultative Status.
The definition of “international NGO” (INGO) is first given in resolution 288 (X) of ECOSOC on February 27, 1950: it is defined as “any international organization that is not founded by an international treaty”. The vital role of NGOs and other “major groups” in sustainable development was recognized in Chapter 27[8] of Agenda 21, leading to intense arrangements for a consultative relationship between the United Nations and non-governmental organizations. [9] Globalization during the 20th century gave rise to the importance of NGOs.
Many problems could not be solved within a nation. International treaties and international organizations such as the World Trade Organization were perceived as being too centred on the interests of capitalist enterprises. Some argued that in an attempt to counterbalance this trend, NGOs have developed to emphasize humanitarian issues, developmental aid and sustainable development. A prominent example of this is the World Social Forum which is a rival convention to the World Economic Forum held annually in January in Davos, Switzerland.
The fifth World Social Forum in Porto Alegre, Brazil, in January 2005 was attended by representatives from more than 1,000 NGOs. [citation needed] Some have argued that in forums like these, NGOs take the place of what should belong to popular movements of the poor. Others argue that NGOs are often imperialist in nature, that they sometimes operate in a racialized manner in dominant countries, and that they fulfill a similar function to that of the clergy during the high colonial era. The philosopher Peter Hallward argues that they are an aristocratic form of politics.
However, this philosophy would suggest that organizations of indigenous peoples are not represented, which is untrue. [11] Whatever the case, NGO transnational networking is now extensive. [12] Types of NGOs Apart from “NGO”, often alternative terms are used as for example: independent sector, volunteer sector, civil society, grassroots organizations, transnational social movement organizations, private voluntary organizations, self-help organizations and non-state actors (NSA’s). Non-governmental organizations are a heterogeneous group. A long list of acronyms has developed around the term “NGO”.
These include: CSO, short for civil society organization; DONGO: Donor Organized NGO; ENGO: short for environmental NGO, such as Global 2000; GONGOs are government-operated NGOs, which may have been set up by governments to look like NGOs in order to qualify for outside aid or promote the interests of the government in question; INGO stands for international NGO; Oxfam is an international NGO QUANGOs are quasi-autonomous non-governmental organizations, such as the International Organization for Standardization (ISO). The ISO is actually not purely an NGO, since its membership is by nation, and each nation is represented by what the ISO Council determines to be the ‘most broadly representative’ standardization body of a nation. That body might itself be a nongovernmental organization; for example, the United States is represented in ISO by the American National Standards Institute, which is independent of the federal government. However, other countries can be represented by national governmental agencies; this is the trend in Europe. ) TANGO: short for technical assistance NGO; GSO: Grassroots Support Organization
MANGO: short for market advocacy NGO The primary purpose of an operational NGO is the design and implementation of development-related projects. One frequently used categorization is the division into relief-oriented versus development-oriented organizations; they can also be classified according to whether they stress service delivery or participation; or whether they are religious or secular; and whether they are more public or private-oriented. Operational NGOs can be community-based, national or international. The primary purpose of an Advocacy NGO is to defend or promote a specific cause.
As opposed to operational project management, these organizations typically try to raise awareness, acceptance and knowledge by lobbying, press work and activist events. NGOs exist for a variety of reasons, usually to further the political or social goals of their members or funders. Examples include improving the state of the natural environment, encouraging the observance of human rights, improving the welfare of the disadvantaged, or representing a corporate agenda. However, there are a huge number of such organizations and their goals cover a broad range of political and philosophical positions.
This can also easily be applied to private schools and athletic organizations. Methods NGOs vary in their methods. Some act primarily as lobbyists, while others primarily conduct programs and activities. For instance, an NGO such as Oxfam, concerned with poverty alleviation, might provide needy people with the equipment and skills to find food and clean drinking water, whereas an NGO like the FFDA helps through investigation and documentation of human rights violations and provides legal assistance to victims of human rights abuses. Others, such as Afghanistan Information Management Services, provide pecialized technical products and services to support development activities implemented on the ground by other organizations. Public relations Non-governmental organizations need healthy relationships with the public to meet their goals. Foundations and charities use sophisticated public relations campaigns to raise funds and employ standard lobbying techniques with governments. Interest groups may be of political importance because of their ability to influence social and political outcomes. A code of ethics [14] was established in 2002 by The World Association of Non Governmental NGOs.
Consulting Project management There is an increasing awareness that management techniques are crucial to project success in non-governmental organizations. [15] Generally, non-governmental organizations that are private have either a community or environmental focus. They address varieties of issues such as religion, emergency aid, or humanitarian affairs. They mobilize public support and voluntary contributions for aid; they often have strong links with community groups in developing countries, and they often work in areas where government-to-government aid is not possible.
NGOs are accepted as a part of the international relations landscape, and while they influence national and multilateral policy-making, increasingly they are more directly involved in local action. Staffing Not all people working for non-governmental organizations are volunteers. The reasons people volunteer are not necessarily purely altruistic, and can provide immediate benefits for themselves as well as those they serve, including skills, experience, and contacts. There is some dispute as to whether expatriates should be sent to developing countries.
Frequently this type of personnel is employed to satisfy a donor who wants to see the supported project managed by someone from an industrialized country. However, the expertise these employees or volunteers may have can be counterbalanced by a number of factors: the cost of foreigners is typically higher, they have no grassroot connections in the country they are sent to, and local expertise is often undervalued. [13] The NGO sector is an important employer in terms of numbers. citation needed] For example, by the end of 1995, CONCERN worldwide, an international Northern NGO working against poverty, employed 174 expatriates and just over 5,000 national staff working in ten developing countries in Africa and Asia, and in Haiti. Funding Large NGOs may have annual budgets in the hundreds of millions or billions of dollars. For instance, the budget of the American Association of Retired Persons (AARP) was over US$540 million in 1999. [16] Funding such large budgets demands significant fundraising efforts on the part of most NGOs.
Major sources of NGO funding include membership dues, the sale of goods and services, grants from international institutions or national governments, and private donations. Several EU-grants provide funds accessible to NGOs. Monitoring and control Years after R2P, the World Federalist Movement, an organization which supports “the creation of democratic global structures accountable to the citizens of the world and call for the division of international authority among separate agencies”, has launched Responsibility to Protect – Engaging Civil Society (R2PCS).
A collaboration between the WFM and the Canadian government, this project aims to bring NGOs into lockstep with the principles outlined under the original R2P project. In recent years, many large corporations have increased their corporate social responsibility departments in an attempt to preempt NGO campaigns against certain corporate practices. As the logic goes, if corporations work with NGOs, NGOs will not work against corporations. In December 2007, The United States Department of Defense Assistant Secretary of Defense (Health Affairs) [1] established an International Health Division under Force Health Protection & Readiness [2].
Part of International Health’s mission is to communicate with NGOs in areas of mutual interest. Department of Defense Directive 3000. 05 [3], in 2005, requires DoD to regard stability-enhancing activities as a mission of importance equal to warfighting. In compliance with international law, DoD has necessarily built a capacity to improve essential services in areas of conflict such as Iraq, where the customary lead agencies (State Department and USAID) find it difficult to operate.
Unlike the “co-option” strategy described for corporations, the OASD(HA) recognizes the neutrality of health as an essential service. International Health cultivates collaborative relationships with NGOs, albeit at arms-length, recognizing their traditional independence, expertise and honest broker status. While the goals of DoD and NGOs may seem incongruent, the DoD’s emphasis on stability and security to reduce and prevent conflict suggests, on careful analysis, important mutual interests. Legal status Unincorporated and voluntary association Trusts, charities and foundations
Companies not just for profit Entities formed or registered under special NGO or nonprofit laws NGOs are not subjects of international law, as states are. An exception is the International Committee of the Red Cross, which is subject to certain specific matters, mainly relating to the Geneva Convention. The Council of Europe in Strasbourg drafted the European Convention on the Recognition of the Legal Personality of International Non-Governmental Organizations in 1986, which sets a common legal basis for the existence and work of NGOs in Europe.
Article 11 of the European Convention on Human Rights protects the right to freedom of association, which is also a fundamental norm for NGOs. Citizen organization There is a growing movement within the “non”-profit and “non”-government sector to define itself in a more constructive, accurate way. Instead of being defined by “non” words, organizations are suggesting new terminology to describe the sector. The term “civil society organization” (CSO) has been used by a growing number of organizations, such as the Center for the Study of Global Governance. 19] The term “citizen sector organization” (CSO) has also been advocated to describe the sector — as one of citizens, for citizens. [20] This labels and positions the sector as its own entity, without relying on language used for the government or business sectors. However some have argued that this is not particularly helpful given that most NGOs are in fact funded by governments and business and that some NGOs are clearly hostile to independently organized people’s organizations. [10][21] Intergovernmental organization Intergovernmental organizations are an important aspect of public international law.
IGOs are established by treaty that acts as a charter creating the group. Treaties are formed when lawful representatives (governments) of several states go through a ratification process, providing the IGO with an international legal personality. Intergovernmental organizations in a legal sense should be distinguished from simple groupings or coalitions of states, such as the G8 or the Quartet. Such groups or associations have not been founded by a constituent document and exist only as task groups. Intergovernmental organizations must also be distinguished from treaties.
Many treaties (such as the North American Free Trade Agreement, or the General Agreement on Tariffs and Trade before the establishment of the World Trade Organization) do not establish an organization and instead rely purely on the parties for their administration becoming legally recognized as an ad hoc commission. Other treaties have established an administrative apparatus which was not deemed to have be granted international legal personality. Types and purposes Intergovernmental organizations differ in function, membership and membership criteria.
They have various goals and scopes, often outlined in the treaty or charter. Some IGOs developed to fulfill a need for a neutral forum for debate or negotiation to resolve disputes. Others developed to carry out mutual interests in a unified form. Common stated aims are to preserve peace through conflict resolution and better international relations, promote international cooperation on matters such as environmental protection, to promote human rights, to promote social development (education, health care), to render humanitarian aid, and to economic development.
Some are more general in scope (the United Nations) while others may have subject-specific missions (such as Interpol or the International Organization for Standardization and other standards organizations). Common types include: Worldwide or global organizations – generally open to nations worldwide as long as certain criteria are met. This category includes the United Nations (UN) and its specialized agencies, the Universal Postal Union, Interpol, the World Trade Organization (WTO), and the International Monetary Fund (IMF).
Regional organizations open to members from a particular region(-s) or continent(-s) of the world. This categories includes the Council of Europe (CoE), European Union (EU), NATO, OSCE, African Union (AU), Organization of American States (OAS), Association of Southeast Asian Nations (ASEAN), and Union of South American Nations. Cultural, linguistic, ethnic, religious, or historical organizations – open to members based on some cultural, linguistic, ethnic, religious, or historical link.
Examples include the Commonwealth of Nations, La Francophonie, Community of Portuguese Language Countries, Latin Union, or Organisation of the Islamic Conference Economic organizations – based on economic organization. Some are dedicated to free trade, the reduction of trade barriers (the World Trade Organization) and International Monetary Fund. Others are focused on international development. International cartels, such as the Organization of Petroleum-Exporting Countries (OPEC), also exist.
The Organisation for Economic Co-operation and Development was founded as an economics-focused organization. An example of a recently-formed economic IGO is the Bank of the South. Some organizations, such as NATO, have collective security or mutual defense provisions. The Union of International Associations publishes an annual directory of organizations and provides ancillary information on most international organizations, both intergovernmental and non-governmental. Examples of IGOs The United Nations Mission:
To maintain international peace and security, and to that end: to take effective collective measures for the prevention and removal of threats to the peace, and for the suppression of acts of aggression or other breaches of the peace, and to bring about by peaceful means, and in conformity with the principles of justice and international law, adjustment or settlement of international disputes or situations which might lead to a breach of the peace; To develop friendly relations among nations based on respect for the principle of equal rights and elf-determination of peoples, and to take other appropriate measures to strengthen universal peace; To achieve international co-operation in solving international problems of an economic, social, cultural, or humanitarian character, and in promoting and encouraging respect for human rights and for fundamental freedoms for all without distinction as to race, sex, language, or religion; and To be a centre for harmonizing the actions of nations in the attainment of these common ends. [1] Membership:[2] 192 Member States Membership is “… pen to all other peace-loving states which accept the obligations contained in the present Charter and, in the judgment of the Organization, are able and willing to carry out these obligations. ” World Bank Mission Statement: “To fight poverty with passion and professionalism for lasting results. To help people help themselves an their environment by providing resources, sharing knowledge, building capacity and forging partnerships in the public and private sectors. ” [3] Membership: 186 Members made up of government-owned organizations. 4] North Atlantic Treaty Organization (NATO) Mission: “The Parties to this Treaty reaffirm their faith in the purposes and principles of the Charter of the United Nations and their desire to live in peace with all peoples and all governments. They are determined to safeguard the freedom, common heritage and civilisation of their peoples, founded on the principles of democracy, individual liberty and the rule of law. They seek to promote stability and well-being in the North Atlantic area. They are resolved to unite their efforts for collective defence and for the preservation of peace and security.
They therefore agree to this North Atlantic Treaty. ” [5] Members: “NATO is an Alliance that consists of 28 independent member countries. “[6] History While treaties, alliances, and multilateral conferences had existed for centuries, IGOs only began to be established in the 19th century. Among the first were the Central Commission for Navigation on the Rhine, initiated in the aftermath of the Napoleonic Wars, and the future International Telegraph Union, which was founded by the signing of the International Telegraph Convention by 20 countries in May 1865.
Of notable significance was the emergence of the League of Nations following World War One, designed as an institution to foster collective security in order to sustain peace. Expansion and growth of IGOs There currently are more than 250 IGOs worldwide, and this number continues to rise. This increase may be attributed to globalization, which increases and encourages the cooperation among and within states. Globalization has also provided easier means for IGO growth, as a result of increased international relations.
This is seen economically, politically, militarily, as well as on the domestic level. Economically, IGOs gain material and non-material resources for economic prosperity. IGOs also provide more political stability within the state and among differing states. Military alliances are also formed by establishing common standards in order to ensure security of the members to ward off outside threats. Lastly, the formation has encouraged autocratic states to develop into democracies in order to form an effective and internal government. [7]/meta/p59961_index. tml; Participation and involvement in IGOs There are several different reasons a state may choose membership in an intergovernmental organization. But there are also reasons membership may be rejected. These reasons are explored in the sections below. Reasons for participation 1) Economic rewards: In the case of the North American Free Trade Agreement (NAFTA), many different countries receive economic benefits from membership in the free trade agreement. For example, Mexican companies are given better access to U. S. markets due to their membership. ) Political influence: Smaller countries, such as Portugal and the Netherlands, who do not carry much political clout on the international stage, are given a substantial increase in influence through membership in IGOs, such as the European Union. 3) Security: Membership in an IGO such as NATO gives security benefits to member countries. This provides an arena where political differences can be resolved. 4) Improve democracy and the likelihood of democratic survival: It has been noted that member countries experience a greater degree of democracy and those democracies survive longer.
Reasons for rejecting membership 1) Loss of sovereignty: Membership often comes with a loss of state sovereignty as treaties are signed which require cooperation on the part of all member states. 2) Insufficient benefits: Often membership does not bring about substantial enough benefits to warrant membership in the organization. Impact of IGOs on world politics Strengths and weaknesses of IGOs These are some of the strengths and weaknesses of IGOs: Strengths: They hold state authority. Their institutions are permanent. They provide a forum for discussion.
They are issue specific. [8] They provide information. They allow multilateral cooperation. [9] Weaknesses: Membership is limited. Prohibits the membership of private citizens. This makes IGOs undemocratic. In addition, not all IGOs allow universal membership. IGOs often overlap resulting in a complex network. States have to give up part of their sovereignty, which weakens the state’s ability to assert its authority. Inequality among state members creates biases and can lead powerful states to misuse these organizations. 10] Non-profit organization Non-profit distinction Whereas for-profit organizations exist to earn and re-distribute taxable wealth to employees and shareholders, the nonprofit corporation exists solely to provide programs and services that are of self-benefit. Often these programs, services and policies are overlooked and not otherwise executed or enforced by the government. While they are able to earn a surplus, more accurately called a profit, such earnings must be retained by the organization for its self-preservation, expansion and future plans.
Earnings may not benefit individuals or stake-holders. [3] While some nonprofit organizations put substantial funds into hiring and rewarding their internal corporate leadership, middle-management personnel and workers, others employ unpaid volunteers and even executives may work for no compensation. However, since the late 1980s there has been a growing consensus that nonprofits can achieve their corporate targets more effectively by using some of the same methods developed in for-profit enterprises.
These include effective internal management, ensuring accountability for results, and monitoring the performance of different divisions or projects in order to better benefit from their capital and workers. Those require satisfied management and that, in turn, begins with the organization’s mission. [4] Nature and goals NPOs are often charities or service organizations; they may be organized as a not-for-profit corporation or as a trust, a cooperative, or they may be purely informal. Sometimes they are also called foundations, or endowments that have large stock funds.
A very similar organization called the supporting organization operates like a foundation, but they are more complicated to administer, they are more tax favored, and the public charities that receive grants from them must have a specially determined relationship. Legal aspects There is a wide diversity of structures and purposes in the NPO landscape. For legal classification and eventual scrutiny, there are, nevertheless, some structural elements of prime legal importance: Economic activity Supervision and management provisions Representation
Accountability and Auditing provisions Provisions for the amendment of the statutes or articles of incorporation Provisions for the dissolution of the entity Tax status of corporate and private donors Tax status of the foundation Some of the above must be, in most jurisdictions, expressed in the document of establishment. Others may be provided by the supervising authority at each particular jurisdiction. While affiliations will not affect a legal status, they may be taken into consideration in legal proceedings as an indication of purpose. Formation and structure
In the United States, nonprofit organizations are formed by incorporating in the state in which they expect to do business. The act of incorporating creates a legal entity enabling the organization to be treated as a corporation under law and to enter into business dealings, form contracts, and own property as any other individual or for-profit corporation may do. Nonprofits can have members but many do not. The nonprofit may also be a trust or association of members. The organization may be controlled by its members who elect the Board of Directors, Board of Governors or Board of Trustees.
Nonprofits may have a delegate structure to allow for the representation of groups or corporations as members. Alternately, it may be a non-membership organization and the board of directors may elect its own successors. A primary difference between a nonprofit and a for-profit corporation is that a nonprofit does not issue stock or pay dividends, (for example, The Code of the Commonwealth of Virginia includes the Non-Stock Corporation Act that is used to incorporate nonprofit entities) and may not enrich its directors.
However, like for-profit corporations, nonprofits may still have employees and can compensate their directors within reasonable bounds. The two major types of nonprofit organization structure are membership and board-only. A membership organization elects the board and has regular meetings and power to amend the bylaws. A board-only organization typically has a self-selected board, and a membership whose powers are limited to those delegated to it by the board.
A board-only organization’s bylaws may even state the organization has no membership, although the organization’s literature may refer to its donors as “members”; examples of such structures are Fairvote[5][6] and the National Organization for the Reform of Marijuana Laws. [7] The Model Nonprofit Corporation Act imposes many complexities and requirements on membership decision-making. Accordingly, many organizations , such as Wikimedia,[8] have formed board-only structures.
The National Association of Parliamentarians has raised concerns about the implications of this trend for the future of openness, accountability, and understanding of grassroots concerns in nonprofit organizations. Specifically, they note that nonprofit organizations, unlike business corporations, are not subject to market discipline for products and shareholder discipline over their capital; therefore, without membership control of major decisions such as election of the board, there are few inherent safeguards against abuse. 9][10] A rebuttal to this might be that as nonprofit organizations grow and seek larger donations, the level of scrutiny rises, including expectations of audited financial statements. [11] Tax exemption In many countries, nonprofits may apply for tax exempt status, so that the organization itself may be exempt from income tax and other taxes. In the United States, to be exempt from federal income taxes the organization must meet the requirements set forth by the Internal Revenue Service. [12] Canada Finland India In India, NPOs are commonly known as Non-Governmental Organizations (NGOs).
Registration can be done with the Registrar of Companies(RoC). The following laws or Constitutional Articles of the Republic of India are relevant to the NGOs: Articles 19(1)(c) and 30 of the Constitution of India Income Tax Act, 1961 Public Trusts Acts of various states Societies Registration Act, 1860 Section 25 of the Indian Companies Act, 1956 Foreign Contribution (Regulation) Act, 1976 South Africa In South Africa, charities issue a tax certificate when requested by donors which can be used as a tax deduction by the donor. [13] United Kingdom
In the UK, many non-profit companies are incorporated as a company limited by guarantee. This means that the company does not have shares or shareholders, but it has the benefits of corporate status. This includes limited liability for its members and being able to enter into contracts and purchase property in its own name. The goals (“objects”) of the company are defined in the Memorandum of Association when the company is formed. The profits of the company (also referred to as the trading surplus) must be invested in achieving these goals and not distributed to the company’s members. 14] Alternatively, non-profit companies may be formed as a Community Interest Company. This is in many ways similar to a Limited Liability Company, but is intended specifically to ensure that the profits and assets of the company are used for public good. A charity is a non-profit organisation that meets stricter criteria regarding its purpose and the way in which it makes decisions and reports its finances. [15] For example, a charity is generally not allowed to pay its Trustees. In England and Wales, charities may be registered with the Charity Commission. 16] In Scotland, the Office of the Scottish Charity Regulator serves the same function. Other organizations which are classified as non-profit organizations elsewhere, such as trade unions, are subject to separate regulations, and are not regarded as “charities” in the technical sense. United States For a United States analysis of this issue, see 501(c)_ and _. After a recognized type of legal entity has been formed at the state level, it is customary for the nonprofit organization to seek tax exempt status with respect to its income tax obligations.
That is typically done by applying to the Internal Revenue Service (IRS), although statutory exemptions exist for limited types of nonprofit organizations. The IRS, after reviewing the application to ensure the organization meets the conditions to be recognized as a tax exempt organization (such as the purpose, limitations on spending, and internal safeguards for a charity), may issue an authorization letter to the nonprofit granting it tax exempt status for income tax payment, filing, and deductibility purposes. The exemption does not apply to other Federal taxes such as employment taxes.
Additionally, a tax-exempt organization must pay federal tax on income that is unrelated to their exempt purpose. [17] Failure to maintain operations in conformity to the laws may result in an organization losing its tax exempt status. Individual states and localities offer nonprofits exemptions from other taxes such as sales tax or property tax. Federal tax-exempt status does not guarantee exemption from state and local taxes, and vice versa. These exemptions generally have separate application processes and their requirements may differ from the IRS requirements.
Furthermore, even a tax exempt organization may be required to file annual financial reports (IRS Form 990) at the state and federal level. Issues faced by NPOs Capacity building is an ongoing problem faced by NPOs for a number of reasons. Most rely on external funding (government funds, grants from charitable foundations, direct donations) to maintain their operations and changes in these sources of revenue may influence the reliability or predictability with which the organization can hire and retain staff, sustain facilities, or create programs.
In addition, unreliable funding, long hours and low pay can lead to employee burnout and high rates of turnover. Founder’s syndrome is an issue organizations face as they grow. Dynamic founders with a strong vision of how to operate the project try to retain control over the organization, even as new employees or volunteers want to expand the project’s scope and try new things. Examples In the United States, two of the wealthiest non-profit organizations are the Bill and Melinda Gates Foundation, which has an endowment of $38 billion,[18] and the Howard Hughes Medical Institute, which has an endowment of approximately $14. billion. Outside the United States, another large NPO is the British Wellcome Trust, which is a “charity” in British usage. See: List of wealthiest foundations. Note that this assessment excludes universities, at least a few of which have assets in the tens of billions of dollars. For example; List of U. S. colleges and universities by endowment Measuring an NPO by its monetary size has obvious limitations, as the power and significance of NPOs are defined by more qualitative measurements such as effectiveness at carrying out charitable mission and goals.
Some NPOs which are particularly well known, often for the charitable or social nature of their activities conducted over a long period of time, include Amnesty International, the Better Business Bureau, Oxfam, Carnegie Corporation of New York, DEMIRA Deutsche Minenraumer (German Mine Clearers), Goodwill Industries, United Way, The National Rifle Association, ACORN, Habitat for Humanity, Teach For America, the Red Cross and Red Crescent organizations, UNESCO, IEEE, World Wide Fund for Nature, Heifer International, and SOS Children’s Villages.
However, there are also millions of smaller NPOs that provide social services and relief efforts on a more focused level (such as Crosswind — Community Outreach Ministry and Literacy Center West) to people throughout the world. There are more than 1. 6 million NPOs in the United States alone. On the Internet In the traditional domain categories as noted in RFC 1591, . org is for “organizations that didn’t fit anywhere else” in the naming system, which implies that it is the proper category for non-commercial organizations if they are not governmental, educational, or one of the other types with a specific TLD.
It is not specifically designated for charitable organizations or any specific organizational or tax-law status, however; it encompasses anything that does not fall into another category. Currently, no restrictions are enforced on registration of . com or . org, so you can find organizations of all sorts in either of these domains, as well as other top-level domains including newer, more-specific ones which may fit particular sorts of organizations such as . museum for museums or . coop for cooperatives.
Organizations might also register under the appropriate country code top-level domain for their country. Other terminology for the sector There is a growing movement within the “non”-profit and “non”-government sector to define itself using more proactive wording. Instead of being defined by “non” words, organizations are suggesting new terminology to describe the sector. The term “civil society organization” (CSO) has been used by a growing number of organizations, such as the Center for the Study of Global Governance. 19] The term “citizen sector organization” (CSO) has also been advocated to describe the sector — as one of citizens, for citizens — by organizations such as Ashoka: Innovators for the Public. [20] This labels and positions the sector as its own entity, without relying on language used for the government or business sectors. However, use of terminology by a nonprofit of self-descriptive language such as “public service organization” or other term that is not legally compliant risks confusing the public about nonprofit abilities, capabilities and limitations. 21] Impact of Globalisation on Developing Countries and India Introduction: Globalisation is the new buzzword that has come to dominate the world since the nineties of the last century with the end of the cold war and the break-up of the former Soviet Union and the global trend towards the rolling ball. The frontiers of the state with increased reliance on the market economy and renewed faith in the private capital and resources, a process of structural adjustment spurred by the studies and influences of the World Bank and other International organisations have started in many of the developing countries.
Also Globalisation has brought in new opportunities to developing countries. Greater access to developed country markets and technology transfer hold out promise improved productivity and higher living standard. But globalisation has also thrown up new challenges like growing inequality across and within nations, volatility in financial market and environmental deteriorations. Another negative aspect of globalisation is that a great majority of developing countries remain removed from the process.
Till the nineties the process of globalisation of the Indian economy was constrained by the barriers to trade and investment liberalisation of trade, investment and financial flows initiated in the nineties has progressively lowered the barriers to competition and hastened the pace of globalisation Definition: Globalised World – What does it mean? Does it mean the fast movement of people which results in greater interaction? Does it mean that because of IT revolution people can be in touch with each other in any part of the world?
Does it mean trade and economy of each country is open in Non-Intrusive way so that all varieties are available to consumer of his choice? Does it mean that mankind has achieved emancipation to a level of where we can say it means a social, economic and political globalisation? Impact on India: India opened up the economy in the early nineties following a major crisis that led by a foreign exchange crunch that dragged the economy close to defaulting on loans. The response was a slew of Domestic and external sector policy measures partly prompted by the immediate needs and partly by the demand of the multilateral organisations.
The new policy regime radically pushed forward in favour of amore open and market oriented economy. Major measures initiated as a part of the liberalisation and globalisation strategy in the early nineties included scrapping of the industrial licensing regime, reduction in the number of areas reserved for the public sector, amendment of the monopolies and the restrictive trade practices act, start of the privatisation programme, reduction in tariff rates and change over to market determined exchange rates.
Over the years there has been a steady liberalisation of the current account transactions, more and more sectors opened up for foreign direct investments and portfolio investments facilitating entry of foreign investors in telecom, roads, ports, airports, insurance and other major sectors. The Indian tariff rates reduced sharply over the decade from a weighted average of 72. 5% in 1991-92 to 24. 6 in 1996-97. Though tariff rates went up slowly in the late nineties it touched 35. 1% in 2001-02. India is committed to reduced tariff rates.
Peak tariff rates are to be reduced to be reduced to the minimum with a peak rate of 20%, in another 2 years most non-tariff barriers have been dismantled by march 2002, including almost all quantitative restrictions. India is Global: The liberalisation of the domestic economy and the increasing integration of India with the global economy have helped step up GDP growth rates, which picked up from 5. 6% in 1990-91 to a peak level of 77. 8% in 1996-97. Growth rates have slowed down since the country has still bee able to achieve 5-6% growth rate in three of the last six years.
Though growth rates has slumped to the lowest level 4. 3% in 2002-03 mainly because of the worst droughts in two decades the growth rates are expected to go up close to 70% in 2003-04. A Global comparison shows that India is now the fastest growing just after China. This is major improvement given that India is growth rate in the 1970’s was very low at 3% and GDP growth in countries like Brazil, Indonesia, Korea, and Mexico was more than twice that of India. Though India’s average annual growth rate almost doubled in the eighties to 5. % it was still lower than the growth rate in China, Korea and Indonesia. The pick up in GDP growth has helped improve India’s global position. Consequently India’s position in the global economy has improved from the 8th position in 1991 to 4th place in 2001. When GDP is calculated on a purchasing power parity basis. Globalisation and Poverty: Globalisation in the form of increased integration though trade and investment is an important reason why much progress has been made in reducing poverty and global inequality over recent decades.
But it is not the only reason for this often unrecognised progress, good national polices , sound institutions and domestic political stability also matter. Despite this progress, poverty remains one of the most serious international challenges we face up to 1. 2 billion of the developing world 4. 8 billion people still live in extreme poverty. But the proportion of the world population living in poverty has been steadily declining and since 1980 the absolute number of poor people has stopped rising and appears to have fallen in recent years despite strong population growth in poor countries.
If the proportion living in poverty had not fallen since 1987 alone a further 215million people would be living in extreme poverty today. India has to concentrate on five important areas or things to follow to achieve this goal. The areas like technological entrepreneurship, new business openings for small and medium enterprises, importance of quality management, new prospects in rural areas and privatisation of financial institutions. The manufacturing of technology and management of technology are two different significant areas in the country.
There will be new prospects in rural India. The growth of Indian economy very much depends upon rural participation in the global race. After implementing the new economic policy the role of villages got its own significance because of its unique outlook and branding methods. For example food processing and packaging are the one of the area where new entrepreneurs can enter into a big way. It may be organised in a collective way with the help of co-operatives to meet the global demand.
Understanding the current status of globalisation is necessary for setting course for future. For all nations to reap the full benefits of globalisation it is essential to create a level playing field. President Bush’s recent proposal to eliminate all tariffs on all manufactured goods by 2015 will do it. In fact it may exacerbate the prevalent inequalities. According to this proposal, tariffs of 5% or less on all manufactured goods will be eliminated by 2005 and higher than 5% will be lowered to 8%.
Starting 2010 the 8% tariffs will be lowered each year until they are eliminated by 2015. GDP Growth rate: The Indian economy is passing through a difficult phase caused by several unfavourable domestic and external developments; Domestic output and Demand conditions were adversely affected by poor performance in agriculture in the past two years. The global economy experienced an overall deceleration and recorded an output growth of 2. 4% during the past year growth in real GDP in 2001-02 was 5. 4% as per the Economic Survey in 2000-01.
The performance in the first quarter of the financial year is5. 8% and second quarter is 6. 1%. Export and Import: India’s Export and Import in the year 2001-02 was to the extent of 32,572 and 38,362 million respectively. Many Indian companies have started becoming respectable players in the International scene. Agriculture exports account for about 13 to 18% of total annual of annual export of the country. In 2000-01 Agricultural products valued at more than US $ 6million were exported from the country 23% of which was contributed by the marine products alone.
Marine products in recent years have emerged as the single largest contributor to the total agricultural export from the country accounting for over one fifth of the total agricultural exports. Cereals (mostly basmati rice and non-basmati rice), oil seeds, tea and coffee are the other prominent products each of which accounts fro nearly 5 to 10% of the countries total agricultural exports. Where does Indian stand in terms of Global Integration? India clearly lags in globalisation. Number of countries have a clear lead among them China, large part of east and far east Asia and eastern Europe.
Lets look at a few indicators how much we lag. ?Over the past decade FDI flows into India have averaged around 0. 5% of GDP against 5% for China 5. 5% for Brazil. Whereas FDI inflows into China now exceeds US $ 50 billion annually. It is only US $ 4billion in the case of India ? Consider global trade – India’s share of world merchandise exports increased from . 05% to . 07% over the pat 20 years. Over the same period China’s share has tripled to almost 4%. ?India’s share of global trade is similar to that of the Philippines an economy 6 times smaller according to IMF estimates.
India under trades by 70-80% given its size, proximity to markets and labour cost advantages. Consequences: The implications of globalisation for a national economy are many. Globalisation has intensified interdependence and competition between economies in the world market. This is reflected in Interdependence in regard to trading in goods and services and in movement of capital. As a result domestic economic developments are not determined entirely by domestic policies and market conditions. Rather, they are influenced by both domestic and international policies and economic conditions.
It is thus clear that a globalising economy, while formulating and evaluating its domestic policy cannot afford to ignore the possible actions and reactions of policies and developments in the rest of the world. This constrained the policy option available to the government which implies loss of policy autonomy to some extent, in decision-making at the national level. Cooperative Origins Cooperation dates back as far as human beings have been organising for mutual benefit. Tribes were organised as cooperative structures, allocating jobs and resources among each other, only trading with the external communities.
Post-industrial Europe is home to the first co-operatives from an industrial context. Other events such as the founding of a friendly society by the Tolpuddle Martyrs in 1832 were key occasions in the creation of organized labor and consumer movements. Social economy Organizational and ideological roots The roots of the co-operative movement can be traced to multiple influences and extend worldwide. In the Anglosphere, post-feudal forms of co-operation between workers and owners, that are expressed today as “profit-sharing” and “surplus sharing” arrangements, existed as far back as 1795. 6] The key ideological influence on the Anglosphere branch of the cooperative movement, however, was a rejection of the charity principles that underpinned welfare reforms when the British government radically revised its Poor Laws in 1834. As both state and church institutions began to routinely distinguish between the ‘deserving’ and ‘undeserving’ poor, a movement of Friendly Societies grew throughout the British Empire based on the principle of mutuality, committed to self-help in the welfare of working people.
From the mid-nineteenth century, mutual organisations embraced these ideas in economic enterprises, firstly amongst tradepeople, and later in co-operative stores, educational institutes, financial institutions and industrial enterprises. The common thread (enacted in different ways, and subject to the contraints of various systems of national law) is the principle that an enterprise or association should be owned and controlled by the people it serves, and share any surpluses on the basis of each members’ cooperative contribution (as a producer, labourer or consumer) rather than their capacity to invest financial capital. 9] The cooperative movement has been fueled globally by ideas of economic democracy. Economic democracy is a socialist extension of the liberal idea of political democracy. Different forms of socialism have developed different approaches to thinking about and building economic democracy. Both Marxism and anarchism, for example, have been influenced by as well as contemporaneous with utopian socialism, which however was based on voluntaristic cooperation, without recognition of class conflict (such as for example is posed by a belligerent capitalist class, dependent on labor and mobilizing by of and for itself).
Anarchists are committed to libertarian socialism and they have focused on local organization, including locally-managed cooperatives, linked through confederations of unions, cooperatives and communities. Marxists, who as socialists have likewise held and worked for the goal of democratizing productive and reproductive relationships, often placed a greater strategic emphasis on confronting the larger scales of human organization.
As they viewed the capitalist class to be prohibitively politically, militarily and culturally mobilized in order to maintain an exploitable working class, they fought in the early twentieth century to appropriate from the capitalist class the society’s collective political capacity in the form of the state, either through democratic socialism, or through what came to be known as Leninism.
Though they regard the state as an unnecessarily oppressive institution, Marxists considered appropriating national and international-scale capitalist institutions and resources (such as the state) to be an important first pillar in creating conditions favorable to solidaristic economies. [10][11] With the declining influence of the USSR after the 1960s, socialist strategies pluralized, though economic democratizers have not as yet established a fundamental challenge to hegemonic and belligerent global neoliberal capitalism.
Meaning Cooperatives as legal entities A cooperative is a legal entity owned and democratically controlled by its members. Members often have a close association with the enterprise as producers or consumers of its products or services, or as its employees. In some countries, e. g. Finland and Sweden, there are specific forms of incorporation for co-operatives. Cooperatives may take the form of companies limited by shares or by guarantee, partnerships or unincorporated associations.
In the USA, cooperatives are often organized as non-capital stock corporations under state-specific cooperative laws. However, they may also be unincorporated associations or business corporations such as limited liability companies or partnerships; such forms are useful when the members want to allow: some members to have a greater share of the control, or some investors to have a return on their capital that exceeds fixed interest, neither of which may be allowed under local laws for cooperatives.
Cooperatives often share their earnings with the membership as dividends, which are divided among the members according to their participation in the enterprise, such as patronage, instead of according to the value of their capital shareholdings (as is done by a joint stock company). Identity Types of cooperative governance Retailers’ cooperative A retailers’ cooperative (known as a secondary or marketing co-operative in ome countries) is an organization which employs economies of scale on behalf of its members to get discounts from manufacturers and to pool marketing. It is common for locally-owned grocery stores, hardware stores and pharmacies. In this case the members of the cooperative are businesses rather than individuals. The Best Western international hotel chain is actually a retailers’ cooperative, whose members are hotel operators, although it now prefers to call itself a “nonprofit membership association. It gave up on the “cooperative” label after some courts insisted on enforcing regulatory requirements for franchisors despite its member-controlled status. Worker cooperative A worker cooperative or producer cooperative is a cooperative, that is owned and democratically controlled by its “worker-owners”. There are no outside owners in a “pure” workers’ cooperative, only the workers own shares of the business, though hybrid forms in which consumers, community members or capitalist investors also own some shares are not uncommon.
In practice, control by worker-owners may be exercised through individual, collective or majority ownership by the workforce, or the retention of individual, collective or majority voting rights (exercised on a one-member one-vote basis). [13] A worker cooperative, therefore, has the characteristic that the majority of its workforce own shares, and the majority of shares are owned by the workforce. 14] Membership is not always compulsory for employees, but generally only employees can become members either directly (as shareholders) or indirectly through membership of a trust that owns the company. Spanish law permits owner-members to register as self-employed enabling worker-owners to establish regulatory regimes that support co-operative working, but which differs considerably co-operatives that are subject to Anglo-American systems of law that require the co-operative (employer) to view (and treat) its worker-members as salaried workers (employees). 17] The implications of this are far-reaching, as this requires co-operatives to establish authority driven statutory disciplinary and grievance procedures (rather than democratic mediation schemes), impacting on the ability of leaders to enact democratic forms of management and counter the authority structures embedded in the dominant system of private enterprise centred around the entrepreneur. [18] Social cooperative
A particularly successful form of multi-stakeholder cooperative is the Italian “social cooperative”, of which some 7,000 exist. “Type A” social cooperatives bring together providers and beneficiaries of a social service as members. “Type B” social cooperatives bring together permanent workers and previously unemployed people who wish to integrate into the labour market. Social cooperatives are legally defined as follows: o more than 80% of profits may be distributed, interest is limited to the bond rate and dissolution is altruistic (assets may not be distributed) the cooperative has legal personality and limited liability the objective is the general benefit of the community and the social integration of citizens those of type B integrate disadvantaged people into the labour market. The categories of disadvantage they target may include physical and mental disability, drug and alcohol addiction, developmental disorders and problems with the law.
They do not include other factors of disadvantage such as race, sexual orientation or abuse. type A cooperatives provide health, social or educational services various categories of stakeholder may become members, including paid employees, beneficiaries, volunteers (up to 50% of members), financial investors and public institutions. In type B co-operatives at least 30% of the members must be from the disadvantaged target groups voting is one person one vote
The volunteer board of a retail consumers’ cooperative, such as the former Oxford, Swindon & Gloucester Co-op, is held to account at an Annual General Meeting of members Consumers’ cooperative A consumers’ cooperative is a business owned by its customers. Employees can also generally become members. Members vote on major decisions, and elect the board of directors from amongst their own number. A well known example in the United States is the REI (Recreational Equipment Incorporated) co-op, and in Canada: Mountain Equipment Co-op.
The world’s largest consumers’ cooperative is the Co-operative Group in the United Kingdom, which offers a variety of retail and financial services. The UK also has a number of autonomous consumers’ cooperative societies, such as the East of England Co-operative Society and Midcounties Co-operative. In fact the Co-operative Group is something of a hybrid, having both corporate members (mostly other consumers’ cooperatives, as a result of its origins as a wholesale society), and individual retail consumer members.
Legacoop[19] in Italy has 414 383 employees, 7 736 210 members and turns over €50Bn per year growing at a steady rate of 4. 41%[20] Japan has a very large and well developed consumer cooperative movement with over 14 million members; retail co-ops alone had a combined turnover of 2. 519 trillion Yen (21. 184 billion US dollars [market exchange rates as of 11/15/2005]) in 2003/4. (Japanese Consumers’ Co-operative Union. , 2003). Migros is the largest supermarket chain in Switzerland and keeps the cooperative society as its form of organization.
Nowadays, a large part of the Swiss population are members of the Migros cooperative – around 2 million of Switzerland’s total population of 7,2 million[1] [2], thus making Migros a supermarket chain that is owned by its customers. Coop is another Swiss cooperative which operates the second largest supermarket chain in Switzerland after Migros. In 2001, Coop merged with 11 cooperative federations which had been its main suppliers for over 100 years.
As of 2005, Coop operates 1437 shops and employs almost 45,000 people. According to Bio Suisse, the Swiss organic producers’ association, Coop accounts for half of all the organic food sold in Switzerland. EURO COOP is the European Community of Consumer Cooperatives. [21] Farmers’ grain Co-op in Crowell, Texas. Business and employment co-operative Business and employment co-operatives (BECs) are a subset of worker co-operatives that represent a new approach to providing support to the creation of new businesses.
Like other business creation support schemes, BECs enable budding entrepreneurs to experiment with their business idea while benefiting from a secure income. The innovation BECs introduce is that once the business is established the entrepreneur is not forced to leave and set up independently, but can stay and become a full member of the co-operative. The micro-enterprises then combine to form one multi-activity enterprise whose members provide a mutually supportive environment for each other.
BECs thus provide budding business people with an easy transition from inactivity to self-employment, but in a collective framework. They open up new horizons for people who have ambition but who lack the skills or confidence needed to set off entirely on their own – or who simply want to carry on an independent economic activity but within a supportive group context. Types of cooperatives Housing cooperative Co-op City in New York houses 55,000 people
A housing cooperative is a legal mechanism for ownership of housing where residents either own shares (share capital co-op) reflecting their equity in the cooperative’s real estate, or have membership and occupancy rights in a not-for-profit cooperative (non-share capital co-op), and they underwrite their housing through paying subscriptions or rent. Housing cooperatives come in three basic equity structures: In Market-rate housing cooperatives, members may sell their shares in the cooperative whenever they like for whatever price the market will bear, much like any other residential property.
Market-rate co-ops are very common in New York City. Limited equity housing cooperatives, which are often used by affordable housing developers, allow members to own some equity in their home, but limit the sale price of their membership share to that which they paid. Group equity or Zero equity housing cooperatives do not allow members to own equity in their residences and often have rental agreements well below market rates. Building cooperative
Members of a building cooperative (in Britain known as a self-build housing co-operative) pool resources to build housing, normally using a high proportion of their own labour. When the building is finished, each member is the sole owner of a homestead, and the cooperative may be dissolved. The term may also refer to worker co-operatives in the building trade. Utility cooperative A utility cooperative is a public utility that is owned by its customers with their ownership manifested in the form of patronage or capital credits, and is thus a type of consumers’ cooperative.
In the US, many cooperatives were formed to provide rural electrical and telephone service as part of the New Deal. See Rural Utilities Service. In the case of electricity, cooperatives are generally either generation and transmission (G&T) co-ops that create and send power via the transmission grid or local distribution co-ops that gather electricity from a variety of sources and send it along to homes and businesses[22]. Agricultural cooperative Agricultural cooperatives are widespread in rural areas.
In the United States, there are both marketing and supply cooperatives (some of which are government-sponsored) which promote and may actually distribute specific commodities. There are also agricultural supply cooperatives, which provide inputs into the agricultural process. In Europe, there are strong agricultural / agribusiness cooperatives, and agricultural cooperative banks. In contrast, while there are notable exceptions, cooperatives have generally struggled to succeed in developing countries, particularly in Africa, despite heavy injection of funds and technical assistance by donors.
Cooperative banking (credit unions and cooperative savings banks) The Co-operative Bank’s head office, 1 Balloon Street, Manchester. The statue in front is of Robert Owen, a pioneer in the cooperative movement. Credit Unions provide a form of cooperative banking. While they have not taken root so deeply as in Ireland or the USA, credit unions are also established in the UK. The largest are work-based, but many are now offering services in the wider community. The Association of British Credit Unions Ltd (ABCUL) represents the majority of British Credit Unions.
British Building Societies developed into general-purpose savings & banking institutions with “one member, one vote” ownership and can be seen as a form of financial cooperative (although nine ‘de-mutualised’ into conventionally-owned banks in the 1980s & 1990s). The UK Co-operative Group includes both an insurance provider CIS and the Co-operative Bank, both noted for promoting ethical investment. Other important European banking cooperatives include the in France, Migros and Coop Bank in Switzerland and the Raiffeisen system in many Central and Eastern European countries.
The Netherlands, Spain, Italy and va
