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NGO Compliance Means-Balancing Culture and Legal Requirements
Most Non-Governmental Organizations (NGO's) perform their missions globally. They provide aid to the sick and infirm, they educate children, they foster human rights, and they promote economic development. This is by no means a complete list of all the good they do as NGO’s provide a wide range of services; too many to list. What they have in common, besides serving humanity, is the challenge of providing services internationally.
Some of the challenges in providing international services are obvious: languages are different, cultures are different, and time zones are different. Let’s focus on one of these obvious issues and dig a little deeper.
Cultures are different. What does this mean? Think about the United States first. People in New York City are very different from people in small towns in, let’s say, Iowa. They may speak the same language, but they look at the world very differently. Think about California and Texas. We laugh about these differences, but they are real. However, other than in politics, people in the US can usually find common ground.
When the cultures are from different countries sometimes it becomes harder to find common ground. Recently I had a conversation with a young man who was attending college in the United States. He came from a kingdom in the Middle East. When asked what he planned to do after college, he told me that he thought he would live here and get a job. This sparked the next question of did he want to become a citizen and his answer surprised me. He said he saw no need to be a citizen, but would probably live his life here.
He liked the economic opportunity here, but the concept of democracy made no sense to him. Keeping in mind that he grew up living under the rule of a King, his thought was that those in charge are in charge, period. He saw no purpose in voting and did not believe it really worked.
He was here. Think about operating there. There are a lot of cultural issues that we either don’t understand or miss entirely. To be successful in providing services in these other countries, NGO’s must understand and work within the cultural norms.
So far, everything written above could be considered obvious. Here’s where the not so obvious can cause a problem. NGO’s receive a large percentage of their funds from governments. In the US, USAID provides a lot of that funding. However, it’s not just the US that funds NGO’s. Governments all around the world fund NGO’s. And each government has its own set of rules for how the funds may be used. NGO’s must ensure that they follow the rules while working within the cultural norms of the country they are in. Achieving this balance can be hard at times for a variety of reasons.
NGO’s provide services in country which usually requires buying goods and services in country. NGO’s must document the selection process for these vendors because of funding requirements. Some NGO’s call this process the “Basis for Vendor Selection”. No matter what it’s called, accurate records must be kept otherwise the NGO is at risk of audit, or worst case, having their funding revoked.
This is where the not so obvious comes into play. Buying goods and services is different from country to country. Unfortunately this can cause conflict and is where the balancing act comes into play. Remember that using government funds requires you to procure goods and services in a way that abides by the laws of the funding source. These funding sources expect that the NGO’s be accountable for the funds and thus the need for documentation and accurate record keeping. Yet the in country personnel may not be familiar with, or understand the need for, these funding rules. They also have their own way of doing things.
To ensure that an NGO’s procurement process meets both in country laws and funding source requirements, an NGO must have policies in place that outline how procurements need to be handled. And, the only way to ensure that policies are followed is to turn them into automated processes. People everywhere do what is right, or easiest, or quickest. However, right, easiest and quickest vary from country to country because of laws and cultural differences. By automating the processes NGO’s can ensure that they are in compliance with government regulations.
Further, automating the processes must include automatic record keeping. This is where online document management and records management are invaluable for an NGO. By automating not only the process, but also the record keeping, an NGO can ensure that procedures are being followed and that they can verify compliance.
This can only be accomplished with an online document management system that enables remote access from around the world, yet stores and protects all of the information back in a secure data center. The two keys here are remote access for field offices so information can be shared and security so that records cannot be modified or deleted.
NGO’s have to balance in country success with preservation of their funding sources. Automation using online document management and records management can ensure that balance.
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Are Your Business Records Ready for a Government Audit or Legal Action?
As a leader in the electronic records management industry, DocuVantage participates in a number of industry forums. Recently we participated in an event held by our Industry Association, AIIM, on the results of their records management research.
While we aren’t surprised by many of the findings, we thought it appropriate to share the results with you. Below are some key findings from the report:
If challenged, 37% of organizations are not confident that their electronic records have not been modified, deleted or inappropriately accessed..
This completely undermines the concept of records management. Business records have very specific rules. The basis for a business record is that it is the final, un-modifiable record or a transaction or event. Further, business records have very specific retention requirements. Modifying or deleting business records have very, very serious consequences from fines to prison sentences.
If your organization falls into that 37%, you need to act now!
26% of organizations have undiscriminating policies on deletion of all emails, 23% keep everything just in case and 31% have no policies or non-enforced policies. The remainder of organizations declares important emails as records and deletes the others.
E-mails can be the Achilles heel or the smoking gun for an organization. E-mails can, and usually, contain information that can be used in an audit or discovery process. By not having a policy on e-mail retention, you put your organization at risk. Any e-mail that is saved is available for discovery. If you delete all e-mails, then you might liable for hiding evidence. Neither is a good place to be.
Your records management policy must also include an e-mail policy.
For 31% of organizations who took part in the research (excluding 45% “Don’t Knows”), a lack of complete electronic information has been an issue with regulation authorities, and for 34% it has been an issue in a court case.
There is a one in three chance that if your organization does not have a records management system in place, and you are involved in a court case, it will cost you. Personally, given the magnitude of the penalties, this is not a gamble I would take. With the low cost of records management, it should be considered a standard cost of doing business. Forget about all the other benefits that a records management system provides, avoiding fines and legal issues alone should be incentive enough to have a records management system.
By implementing a records management system, you avoid potential legal issues.
In 26% of organizations, undeleted records beyond their retention period have affected a court case, twice as often weakening it rather than strengthening it.
Having a records management policy is the first step. Implementing a record management system is the second!
So what do you take away from the above results?
I believe that most organizations are operating with an unnecessary risk. Given that the way to mitigate this risk is both easy and inexpensive, why would any organization not address it?
If you are not sure how to address this risk, then ask us. With years of experience in records management, DocuVantage can help you with both the creation of your records management policy and the implementation of an electronic records management system.
For more information, please visit our webpage on Online Records Management.
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