Transparency indicators to improve accountability for non-profit organizations: a Spanish case study
Abstract
We are currently witnessing the development of a set of organizations that have been entrusted with meeting the very diverse needs of citizens. As a result, they receive funds, in order to ensure they are managed appropriately. The transparency of the information revealed by Non-profit Organizations (NPOs) has become of increasing interest to public authorities and research. However, very few studies empirically measure the extent of transparency in NPOs. Only a handful checked the compliance of various indicators, lacking agreement on which ones to include and their weighting. To address this issue, this study empirically validates the weighting of the indicators from the alliance between the Platform for Social Action NGO and the Spanish Coordinator for Development NGO (CONGDE) document with experts in NPOs’ opinions. We use the Best-Worst Method (BWM) to optimally assign weights to multi-criteria decision making situations. Our results show interesting differences in the level of importance given to the indicators by public authorities and experts, suggesting the need for a revision of the importance proposed.
First published online 04 May 2021
Keyword : transparency, batteries of indicators, non-profit organizations (NPOs), Best–Worst Method (BWM)
How to Cite
Moreno-Albarracín, A. L., Ortega-Rodríguez, C., Licerán-Gutiérrez, A., Labella, Álvaro, & Martínez, L. (2021). Transparency indicators to improve accountability for non-profit organizations: a Spanish case study. Technological and Economic Development of Economy, 27(3), 763-782. https://doi.org/10.3846/tede.2021.14821
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Cabedo, J. D., Fuertes‐Fuertes, I., Maset‐LLaudes, A., & Tirado‐Beltrán, J. M. (2018). Improving and measuring transparency in NGOs: A disclosure index for activities and projects. Nonprofit Management and Leadership, 28(3), 329–348. https://doi.org/10.1002/nml.21298
Celik, E., & Gumus, A. T. (2018). An assessment approach for non-governmental organizations in humanitarian relief logistics and an application in Turkey. Technological and Economic Development of Economy, 24(1), 1–26. https://doi.org/10.3846/20294913.2015.1056277
Cestari, J. M. A. P., de Lima, E. P., Deschamps, F., Van Aken, E. M., Treinta, F., & Moura, L. F. (2018). A case study extension methodology for performance measurement diagnosis in nonprofit organizations. International Journal of Production Economics, 203, 225–238. https://doi.org/10.1016/j.ijpe.2018.06.018
CONGDE. (2019). Herramienta de transparencia y buen gobierno. Plataforma de ONG de Acción Social y Coordinadora de ONGD-España.
Džunić, M., Stanković, J., & Janković-Milić, V. (2018). Multi-criteria approach in evaluating contribution of social entrepreneurship to the employment of socially-excluded groups. Technological and Economic Development of Economy, 24(5), 1885–1908. https://doi.org/10.3846/20294913.2017.1347906
Estrella, F. J., Espinilla, M., Herrera, F., & Martínez, L. (2014). FLINTSTONES: A fuzzy linguistic decision tools enhancement suite based on the 2-tuple linguistic model and extensions. Information Sciences, 280, 152–170. https://doi.org/10.1016/j.ins.2014.04.049
Franco, C. M. M., & Raja, I. G. (2014). Medida de la eficiencia en entidades no lucrativas: un estudio empírico para fundaciones asistenciales. Revista de Contabilidad-Spanish Accounting Review, 17(1), 47–57. https://doi.org/10.1016/j.rcsar.2013.08.005
Gandía, J. L. (2011). Internet disclosure by nonprofit organizations: Empirical evidence of nongovernmental organizations for development in Spain. Nonprofit and Voluntary Sector Quarterly, 40(1), 57–78. https://doi.org/10.1177/0899764009343782
Greenlee, J., Fischer, M., Gordon, T., & Keating, E. (2007). An investigation of fraud in nonprofit organizations: Occurrences and deterrents. Nonprofit and Voluntary Sector Quarterly, 36(4), 676–694. https://doi.org/10.1177/0899764007300407
Hale, K. (2013). Understanding nonprofit transparency: the limit of formal regulation in the American nonprofit sector. International Review of Public Administration, 18(3), 31–49. https://doi.org/10.1080/12294659.2013.10805262
Hofmann, M. A., & McSwain, D. (2013). Financial disclosure management in the nonprofit sector: A framework for past and future research. Journal of Accounting Literature, 32(1), 61–87. https://doi.org/10.1016/j.acclit.2013.10.003
Keating, E. K., & Frumkin, P. (2003). Reengineering nonprofit financial accountability: Toward a more reliable foundation for regulation. Public Administration Review, 63(1), 3–15. https://doi.org/10.1111/1540-6210.00260
Kim, M. (2017). The relationship of nonprofits’ financial health to program outcomes: Empirical evidence from nonprofit arts organizations. Nonprofit and Voluntary Sector Quarterly, 46(3), 525–548. https://doi.org/10.1177/0899764016662914
Labella, Á., Liu, Y., Rodríguez, R. M., & Martínez, L. (2018). Analyzing the performance of classical consensus models in large scale group decision making: A comparative study. Applied Soft Computing Journal, 67, 677–690. https://doi.org/10.1016/j.asoc.2017.05.045
Liang, F., Brunelli, M., & Rezaei, J. (2019). Consistency issues in the best worst method: Measurements and thresholds. Omega, 102175. https://doi.org/10.1016/j.omega.2019.102175
Manville, G., & Greatbanks, R. (2016). Third sector performance: Management and finance in not-forprofit and social enterprises. Routledge. https://doi.org/10.4324/9781315551098
Moreno-Albarracín, A. L., Licerán-Gutierrez, A., Ortega-Rodríguez, C., Labella, Á., & Rodríguez, R. M. (2020). Measuring what is not seen – Transparency and good governance nonprofit indicators to overcome the limitations of accounting models. Sustainability, 12(18), 7275. https://doi.org/10.3390/su12187275
Moreno, P. D. C., Alcaide, T. C. H., & San Juan, A. I. S. (2016). La transparencia organizativa y económica en la Web de las fundaciones: un estudio empírico para España. REVESCO: Revista de Estudios Cooperativos, 121, 62–88. https://doi.org/10.5209/rev_REVE.2016.v121.49701
Ortega-Rodríguez, C., Licerán-Gutiérrez, A., & Moreno-Albarracín, A. L. (2020). Transparency as A key element in accountability in non-profit organizations: A systematic literature review. Sustainability, 12(14), 5834. https://doi.org/10.3390/su12145834
Rezaei, J. (2015). Best-worst multi-criteria decision-making method. Omega, 53, 49–57. https://doi.org/10.1016/j.omega.2014.11.009
Righi, A., & Andreoni, V. (2014). Towards a comparable and harmonised set of performance indicators for Third Sector organisations: The Italian experience. International Journal of Productivity and Performance Management, 63(6), 766–778. https://doi.org/10.1108/IJPPM-09-2013-0152
Rodríguez, R. M., Labella, Á., De Tré, G., & Martínez, L. (2018). A large scale consensus reaching process managing group hesitation. Knowledge-Based Systems, 159, 86–97. https://doi.org/10.1016/j.knosys.2018.06.009
Saaty, T. L. (1989). Group decision making and the AHP. In B. L. Golden, E. A. Wasil, & P. T. Harker (Eds.), The analytic hierarchy process (pp. 59–67). Springer. https://doi.org/10.1007/978-3-642-50244-6_4
Saint, S., & Lawson, J. R. (1994). Rules for reaching consensus: a modern approach to decision making. Wiley.
Sanzo-Pérez, M. J., Rey-Garcia, M., & Álvarez-González, L. I. (2017). The drivers of voluntary transparency in nonprofits: Professionalization and partnerships with firms as determinants. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 28(4), 1595–1621. https://doi.org/10.1007/s11266-017-9882-9
Saxton, G. D., & Guo, C. (2011). Accountability online: Understanding the web-based accountability practices of nonprofit organizations. Nonprofit and Voluntary Sector Quarterly, 40(2), 270–295. https://doi.org/10.1177/0899764009341086
Schatteman, A. (2013). Nonprofit accountability: To whom and for what? An introduction to the special issue. International Review of Public Administration, 18(3), 1–6. https://doi.org/10.1080/12294659.2013.10805260
Speckbacher, G. (2008). Nonprofit versus corporate governance: An economic approach. Nonprofit Management & Leadership, 18(3), 295–320. https://doi.org/10.1002/nml.187
Tacon, R., Walters, G., & Cornforth, C. (2017). Accountability in nonprofit governance: A process-based study. Nonprofit and Voluntary Sector Quarterly, 46(4), 685–704. https://doi.org/10.1177/0899764017691637
Tremblay-Boire, J., & Prakash, A. (2015). Accountability.org: Online disclosures by US nonprofits. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(2), 693–719. https://doi.org/10.1007/s11266-014-9452-3
Valencia, L. A. R., Queiruga, D., & González-Benito, J. (2015). Relationship between transparency and efficiency in the allocation of funds in nongovernmental development organizations. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(6), 2517–2535. https://doi.org/10.1007/s11266-014-9527-1
Valentinov, V., & Vaceková, G. (2015). Sustainability of rural nonprofit organizations: Czech Republic and beyond. Sustainability, 7(8), 9890–9906. https://doi.org/10.3390/su7089890
Willems, J., Boenigk, S., & Jegers, M. (2014). Seven trade-offs in measuring nonprofit performance and effectiveness. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 25(6), 1648–1670. https://doi.org/10.1007/s11266-014-9446-1
Austin, J. E. (2000). Strategic collaboration between nonprofits and businesses. Nonprofit and Voluntary Sector Quarterly, 29(1_suppl), 69–97. https://doi.org/10.1177/0899764000291S004
Ben-Arieh, D., & Easton, T. (2007). Multi-criteria group consensus under linear cost opinion elasticity. Decision Support Systems, 43(3), 713–721. https://doi.org/10.1016/j.dss.2006.11.009
Benjamin, L. M. (2008). Account space: How accountability requirements shape nonprofit practice. Nonprofit and Voluntary Sector Quarterly, 37(2), 201–223. https://doi.org/10.1177/0899764007301288
Burger, R., & Owens, T. (2010). Promoting transparency in the NGO sector: Examining the availability and reliability of self-reported data. World Development, 38, 1263–1277. https://doi.org/10.1016/j.worlddev.2009.12.018
Butler, C. L., & Rothstein, A. (2007). On conflict and consensus: A handbook on formal consensus decisionmaking. Mountain. Mountain View, CA. Creative Commons.
Cabedo, J. D., Fuertes‐Fuertes, I., Maset‐LLaudes, A., & Tirado‐Beltrán, J. M. (2018). Improving and measuring transparency in NGOs: A disclosure index for activities and projects. Nonprofit Management and Leadership, 28(3), 329–348. https://doi.org/10.1002/nml.21298
Celik, E., & Gumus, A. T. (2018). An assessment approach for non-governmental organizations in humanitarian relief logistics and an application in Turkey. Technological and Economic Development of Economy, 24(1), 1–26. https://doi.org/10.3846/20294913.2015.1056277
Cestari, J. M. A. P., de Lima, E. P., Deschamps, F., Van Aken, E. M., Treinta, F., & Moura, L. F. (2018). A case study extension methodology for performance measurement diagnosis in nonprofit organizations. International Journal of Production Economics, 203, 225–238. https://doi.org/10.1016/j.ijpe.2018.06.018
CONGDE. (2019). Herramienta de transparencia y buen gobierno. Plataforma de ONG de Acción Social y Coordinadora de ONGD-España.
Džunić, M., Stanković, J., & Janković-Milić, V. (2018). Multi-criteria approach in evaluating contribution of social entrepreneurship to the employment of socially-excluded groups. Technological and Economic Development of Economy, 24(5), 1885–1908. https://doi.org/10.3846/20294913.2017.1347906
Estrella, F. J., Espinilla, M., Herrera, F., & Martínez, L. (2014). FLINTSTONES: A fuzzy linguistic decision tools enhancement suite based on the 2-tuple linguistic model and extensions. Information Sciences, 280, 152–170. https://doi.org/10.1016/j.ins.2014.04.049
Franco, C. M. M., & Raja, I. G. (2014). Medida de la eficiencia en entidades no lucrativas: un estudio empírico para fundaciones asistenciales. Revista de Contabilidad-Spanish Accounting Review, 17(1), 47–57. https://doi.org/10.1016/j.rcsar.2013.08.005
Gandía, J. L. (2011). Internet disclosure by nonprofit organizations: Empirical evidence of nongovernmental organizations for development in Spain. Nonprofit and Voluntary Sector Quarterly, 40(1), 57–78. https://doi.org/10.1177/0899764009343782
Greenlee, J., Fischer, M., Gordon, T., & Keating, E. (2007). An investigation of fraud in nonprofit organizations: Occurrences and deterrents. Nonprofit and Voluntary Sector Quarterly, 36(4), 676–694. https://doi.org/10.1177/0899764007300407
Hale, K. (2013). Understanding nonprofit transparency: the limit of formal regulation in the American nonprofit sector. International Review of Public Administration, 18(3), 31–49. https://doi.org/10.1080/12294659.2013.10805262
Hofmann, M. A., & McSwain, D. (2013). Financial disclosure management in the nonprofit sector: A framework for past and future research. Journal of Accounting Literature, 32(1), 61–87. https://doi.org/10.1016/j.acclit.2013.10.003
Keating, E. K., & Frumkin, P. (2003). Reengineering nonprofit financial accountability: Toward a more reliable foundation for regulation. Public Administration Review, 63(1), 3–15. https://doi.org/10.1111/1540-6210.00260
Kim, M. (2017). The relationship of nonprofits’ financial health to program outcomes: Empirical evidence from nonprofit arts organizations. Nonprofit and Voluntary Sector Quarterly, 46(3), 525–548. https://doi.org/10.1177/0899764016662914
Labella, Á., Liu, Y., Rodríguez, R. M., & Martínez, L. (2018). Analyzing the performance of classical consensus models in large scale group decision making: A comparative study. Applied Soft Computing Journal, 67, 677–690. https://doi.org/10.1016/j.asoc.2017.05.045
Liang, F., Brunelli, M., & Rezaei, J. (2019). Consistency issues in the best worst method: Measurements and thresholds. Omega, 102175. https://doi.org/10.1016/j.omega.2019.102175
Manville, G., & Greatbanks, R. (2016). Third sector performance: Management and finance in not-forprofit and social enterprises. Routledge. https://doi.org/10.4324/9781315551098
Moreno-Albarracín, A. L., Licerán-Gutierrez, A., Ortega-Rodríguez, C., Labella, Á., & Rodríguez, R. M. (2020). Measuring what is not seen – Transparency and good governance nonprofit indicators to overcome the limitations of accounting models. Sustainability, 12(18), 7275. https://doi.org/10.3390/su12187275
Moreno, P. D. C., Alcaide, T. C. H., & San Juan, A. I. S. (2016). La transparencia organizativa y económica en la Web de las fundaciones: un estudio empírico para España. REVESCO: Revista de Estudios Cooperativos, 121, 62–88. https://doi.org/10.5209/rev_REVE.2016.v121.49701
Ortega-Rodríguez, C., Licerán-Gutiérrez, A., & Moreno-Albarracín, A. L. (2020). Transparency as A key element in accountability in non-profit organizations: A systematic literature review. Sustainability, 12(14), 5834. https://doi.org/10.3390/su12145834
Rezaei, J. (2015). Best-worst multi-criteria decision-making method. Omega, 53, 49–57. https://doi.org/10.1016/j.omega.2014.11.009
Righi, A., & Andreoni, V. (2014). Towards a comparable and harmonised set of performance indicators for Third Sector organisations: The Italian experience. International Journal of Productivity and Performance Management, 63(6), 766–778. https://doi.org/10.1108/IJPPM-09-2013-0152
Rodríguez, R. M., Labella, Á., De Tré, G., & Martínez, L. (2018). A large scale consensus reaching process managing group hesitation. Knowledge-Based Systems, 159, 86–97. https://doi.org/10.1016/j.knosys.2018.06.009
Saaty, T. L. (1989). Group decision making and the AHP. In B. L. Golden, E. A. Wasil, & P. T. Harker (Eds.), The analytic hierarchy process (pp. 59–67). Springer. https://doi.org/10.1007/978-3-642-50244-6_4
Saint, S., & Lawson, J. R. (1994). Rules for reaching consensus: a modern approach to decision making. Wiley.
Sanzo-Pérez, M. J., Rey-Garcia, M., & Álvarez-González, L. I. (2017). The drivers of voluntary transparency in nonprofits: Professionalization and partnerships with firms as determinants. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 28(4), 1595–1621. https://doi.org/10.1007/s11266-017-9882-9
Saxton, G. D., & Guo, C. (2011). Accountability online: Understanding the web-based accountability practices of nonprofit organizations. Nonprofit and Voluntary Sector Quarterly, 40(2), 270–295. https://doi.org/10.1177/0899764009341086
Schatteman, A. (2013). Nonprofit accountability: To whom and for what? An introduction to the special issue. International Review of Public Administration, 18(3), 1–6. https://doi.org/10.1080/12294659.2013.10805260
Speckbacher, G. (2008). Nonprofit versus corporate governance: An economic approach. Nonprofit Management & Leadership, 18(3), 295–320. https://doi.org/10.1002/nml.187
Tacon, R., Walters, G., & Cornforth, C. (2017). Accountability in nonprofit governance: A process-based study. Nonprofit and Voluntary Sector Quarterly, 46(4), 685–704. https://doi.org/10.1177/0899764017691637
Tremblay-Boire, J., & Prakash, A. (2015). Accountability.org: Online disclosures by US nonprofits. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(2), 693–719. https://doi.org/10.1007/s11266-014-9452-3
Valencia, L. A. R., Queiruga, D., & González-Benito, J. (2015). Relationship between transparency and efficiency in the allocation of funds in nongovernmental development organizations. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(6), 2517–2535. https://doi.org/10.1007/s11266-014-9527-1
Valentinov, V., & Vaceková, G. (2015). Sustainability of rural nonprofit organizations: Czech Republic and beyond. Sustainability, 7(8), 9890–9906. https://doi.org/10.3390/su7089890
Willems, J., Boenigk, S., & Jegers, M. (2014). Seven trade-offs in measuring nonprofit performance and effectiveness. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 25(6), 1648–1670. https://doi.org/10.1007/s11266-014-9446-1