How NGOs Got Here: Historical and Social Context of Philanthropic Movements

How NGOs Got Here:  Historical and Social Context of Philanthropic Movements

Keywords:  philanthropy, NGO history, noblesse oblige
2800 words

John P. Harrison, CAE

(first published as part of the American Cancer Society world wide training for NGO management, © 2006.  All rights reserved by the author)

Many historical forces intersect to yield a modern NGO (Non-governmental Organisation):  philanthropy, medicine, social and religious climate, and so on.  Not-for-profit organisations, especially those in the USA, have benefited from centuries of social and technological developments.  We explore some of the more interesting aspects of that development with a hope it may provide some light on an organisation’s possibilities and issues in other cultures. 

We start by defining philanthropy as voluntary action for the public good.  For many societies, the earliest and most prominent mention of philanthropy is in the religious traditions.  Although most all faiths contain teachings on charity and humane benevolence (Hinduism and Buddhism have dana, or charitable welfare, and Confucius taught of benevolent government, and most tribal religions have some form of communal charity), the expressly mandated charitable behaviour of the three Abrahamic faiths (Judaism, Christianity, and Islam) has no doubt been a huge force in shaping philanthropy in the West. 

The teachings of prescribed tithing, service to others, and alms, have helped shape the concept of noblesse oblige.  It is not only modern religion that puts forth this philosophy of sharing the wealth however, for Julius Caesar also left large legacies for public purpose.  Interestingly, in ancient writings, we also find along side this willingness to share, the distrust of giving things away for fear of being cheated by false beggars.  Indeed, philanthropy (charity to people) itself was described as the Greek god Prometheus’ crime as he gave away fire philanthropically to humans (and was bound to the mountain peak as punishment). 

In order to understand the tendency toward voluntary behaviour for the public good, it is important to know the underpinnings of the philosophy of charity.  In classical China, for instance, charitable behaviour was much more likely to be done in secret rather than in any public way.  It was not until late in the Ming Dynasty (AD 1300- 1600) that the concept of public charity became more accepted. 

In the West, two great events did much to shape organised charity:  the Black Death (or bubonic plague) and several centuries later the Industrial Revolution.   After the plague of the 14^th Century, the Europe that survived entered an Age of Benevolence, characterised by a more “this worldly” approach to solving problems.   Increased ability to organise and more knowledge (spread through the printing press) led to changing expectations of Church and government.  Science as an endeavour for the public good began to take shape, and many charitable hospitals arose.   Scientific fraternities or societies formed, peer review and publication spread, and the aristocracy by and large subscribed to noblesse oblige, especially in Britain.

In Britain, the advent of the Industrial Revolution in the 1800’s, created unprecedented wealth, and the mechanisation also caused vast changes in the previously agrarian social structure.  Urban poverty and unhealthy living conditions were brought to light by such authors as Charles Dickens, and the aristocracy and others were instrumental in forming relief agencies, organisations, and movements.  

About the same time, the founding and growth of the USA gave rise to a proliferation of non-profits and organised and individual charitable work.  The “association” phenomenon in the US thrived because of several reasons:  the British organisational heritage—without the aristocracy, the Puritanical mandate for good works, the emphasis on individual action (from frontier individualism), the absence (or distrust) of government, and the plentiful resources of the New World.  The French essayist de Tocqueville, upon studying the US, noted that the “Americans of all ages, all stations of life, and all types of disposition are forever forming associations”.   Indeed, today there are well over a million registered tax-exempt associations and other non-profit organisations in the US. 

In other parts of the world, the advent of philanthropic organisations arose much differently.  In Latin America, the influence of the Roman Catholic Church (from the Spanish and Portuguese Empires) shaped charity work as the Church funded lay-led institutions and Catholic fraternities to do much of the work.  The advent of community-led organisations apart from the Church is a much more recent phenomenon. 

During the Cold War, communist countries often officially saw much of the social ills of the West as part of a larger class struggle and refused or were reluctant to have any social programmes apart from the government.  In the Soviet Union, for instance, NGOs were not allowed to operate until 1985, during the Gorbachev era. 

Even though many cultures might have had indigenous ways of handling philanthropy, these were often overshadowed by the presence of a colonial power.  The colonial power’s legal system, organisational culture, and direct relief efforts usually set the stage for the manner in which philanthropic organisations would develop.  Also, if a strong, non-democratic government was present, this often led to the sponsored nurturing of a favourite cause (often at the whim of a dictator or the oligarchy). 

As part of the rise and democratisation of philanthropic organisations, public scrutiny and the demand for transparency have also risen.  At the end of WWI, a conflict having much to do with the forces of industrialisation versus those of agriculture and the aristocracy, there was a period of intense scrutiny of existing charities probably in part as a rebuke of the old aristocratic order.   During the aftermath of WWII though, charitable organisations were needed as never before, and the newly formed United Nations in fact coined the term “Non-Governmental Organisation”.

The term NGO

The term NGO describes many diverse types of bodies, and there is no precise generally-accepted definition.  Perhaps it is best to describe what an NGO is not:  it is not a government bureaucracy, a political party, a for-profit company, or a criminal or violent group.  In essence, an NGO is a private voluntary organisation—an independent, voluntary organisation acting for some common, presumably philanthropic, purpose.   A classic example is the Red Cross (ICRC), founded in the 1860s to help victims of war and an organisation which derives its legitimacy by being neutral as it regards governments.  

This brings up the question of whether an NGO is usually an operational group mobilised for some specific relief or development project or an “interest” group built around advocating a certain cause or point of view.  This distinction is dependent on the concerns of the critic and has little analytical value. Governments agreeing with the actions of a particular NGO may refer to them as neutral groups operating on a worthwhile project, and governments at odds with a particular NGO may label it as one-sided pressure group; it all depends.  An NGO may bring needed resources to a project with a government’s blessing, or an NGO may be viewed as a competitor, doing what the government itself should be doing or at least wants to collect funds for doing:

“The way philanthropy is done, the way it is structured and its preferred objectives often become battlegrounds for other issues.”  (Ilchman et al, 1998).  

Case Example:  Indonesia  (adapted from www.asianphilanthropy.org)

Indonesia : History of Philanthropy

Philanthropy in Indonesia has long existed as a part of tradition and custom of its people for centuries. Religious institutions and values are the two major factors that motivated Indonesian people to involve in philanthropic activities. 

According to Islam (the religion of 85% of people in Indonesia), philanthropy comes with religious belief and in different suggested forms. Similar mechanisms are also practised by the followers of other religions in Indonesia: Christianity, Buddhism, and Hinduism. Furthermore, many cultural traditions in Indonesia accommodate philanthropic activities. For example, the Minangkabau people, in West Sumatra, and the Sundanese and Javanese peoples in Java, have traditions of helping each others by giving money, food and other necessary items to the poor.

Old Order Government Era (1945-1965)

Indonesia won its independence (from Dutch rule and Japanese occupation) in 1945. Some religious and social organizations were established during the independence war and existed during the late 1940s and early 1950s.  Many voluntary philanthropic practices were channelled through religious and social organisations. For example, two large Muslim organizations, Nahdatil Ulama (NU) and Muhammadiyah organized collection of funds from mosques.  The Lembaga Daya Dharma (LDD) in Jakarta, worked for managing funds collected by all Catholic churches in Indonesia, and similarly, Yadna Puniakerti in Surabaya applied the same pattern in collecting funds from Hindu temples. Nichiren Syosu Indonesia (NSI) organised collection of funds from Buddhist temples.

During that time, the post-colonial government was involved in managing and collecting obligatory annual wealth and poll taxes (Zakat), non-obligatory taxes such as ad hoc contribution in cash or service (Sadaqua).  The government also has allowed community and non-profit organizations to self-organise similar tax collecting bodies known as Lembaga Amil Zaka, Infaq, Sedekah (LAZ).

New Order Government (1966-1998)

Philanthropic practices channelled through religious and social organisations expanded between 1966-98. Some social foundations and religious organisations with great concern for philanthropy were established during this period. Through new laws, non-profit foundations were allowed to work in the fields of education, religion, health, and culture and to have tax exemptions. The number of social foundations and religious organizations involved in philanthropic activities has significantly increased ever since. However, later laws regarding taxation of social foundations, reduced the tax exemption benefits granted to non-profit foundations in the previous tax laws.

Corporate philanthropy is another important source for the development of philanthropy in Indonesia. However, during the New Order regime, these potential funds were exclusively managed by the foundations owned by the president Soeharto’s families. Following the fall of Soeharto’s regime in 1998, corporate philanthropy became more accessible for other social foundations and religious organisations.

The Current Government

Corporate and religious donations have been popular philanthropic activities since 1998. Besides, electronic and print media companies are actively collecting funds and giving coverage to their philanthropic activities. In addition to providing larger coverage in collecting donations and funds, the involvement of the media also provides transparency, thus becoming important in the current philanthropic activities in Indonesia.

Case Studies:  Brazil, Ghana, Egypt, India, and Thailand

Adapted from:   Salamon, Lester M. and Helmut K. Anheier.  “The Third World’s Third Sector in Comparative Perspective.” Working Papers of the Johns Hopkins Comparative Nonprofit Sector Project, no. 24, edited by Lester M. Salamon and Helmut K. Anheier. (Baltimore: The Johns Hopkins Institute for Policy Studies, 1997).

While the nonprofit sectors of the five countries examined here seem to be quite a bit more extensive than previous analyses suggested, they are nevertheless still generally smaller than in the average developed country.  Compared to 4% or 5% of the labor force in the developed countries, nonprofit organizations in the developing world generally employ fewer than 2% of the workforce. What is more, significant variations seem to exist in the scale of nonprofit activity from country to country.  Thus the nonprofit sector seems more fully developed in India and Brazil than it does in Thailand, Egypt, or Ghana.

In India, for example, various directories list a total of about one million nonprofit organizations including professional associations, social welfare agencies, caste associations, and thousands of others.  The network in Ghana of 1,700 nonprofit organizations alone employs about 600,000 people.

In Brazil, the Catholic Church, in close alliance with the State, built a vast network of schools and hospitals, with Protestant denominations setting up competing institutions. At the end of the 19th century, secular voluntary associations such as mutual societies and trade unions emerged as the country developed economically.  The upshot is a sizable and varied set of nonprofit institutions. Federal government registries list over 210,000 nonprofit organizations, including 45,000 in São Paolo alone and another 16,000 in Rio de Janeiro.  Most of these organizations are small, with budgets of less than US$30,000, but there are also huge educational institutions and hospitals that are frequently linked to the Catholic Church.  Total employment within this sector is at least 1 million, or somewhat less than 2% of total employment.  What is more, this sector has been growing in recent years.  A survey of nonprofit organizations in São Paolo and Rio de Janeiro revealed that over 90 percent of the numerous neighborhood and community organizations that exist in these two cities were formed in the last two decades.

Although nonprofit institutions seem to be somewhat less extensive in Thailand, Egypt, and Ghana than in Brazil and India, they are far from nonexistent.  In Thailand, for example, there are some 15,000 nonprofit organizations, 2,200 of them in Bangkok alone. Cremation associations are the most frequent type of such organizations, accounting for 50% of the total.  These associations have deep roots in Thai society, handling the all-important burial functions that are so sacred to Buddhism; but they have recently begun assuming modern credit functions as well. In addition to the cremation societies, moreover, numerous social welfare associations also exist, comprising 39% of the registered organizations.

In Ghana, the Department of Social Welfare has identified over 800 nonprofit organizations in the larger urban areas alone.  However, only about one fourth of these are officially registered with the government.  In addition, there are 114 nonprofit hospitals scattered throughout the country, as well as 242 primary and 229 secondary schools, all typically linked to religious bodies.  Moreover, the 800 organizations listed by the Department of Social Welfare do not include the numerous village associations, credit and savings associations and similar types of self-help groups, such as the Susu associations, with roots in village traditions.

Finally, Egypt boasts some 17,500 nonprofit organizations with an estimated total membership of almost 6 million people out of a total population of over 53 million. This does not include the numerous informal associations among the poor, nor many of the Islamic groups organized around individual mosques.  The latter constitutes a vast network of unregistered groups created by popular Islam, providing health, social services and education to populations that the State, with its dwindling resources, is increasingly unable to reach.

Not only is the nonprofit sector in these countries quite large, it also extends well beyond the "NGOs" that have been the principal focus of attention in the developing world.  Thus, for example:

                        In Brazil, nearly one quarter of the 210,000 nonprofit organizations registered with the federal government are social service providers, 20% are sport and recreational clubs, and another 14% are organizations active in the fields of education, research and culture. Based on a survey of nonprofit organizations in the state of Rio de Janeiro, we estimate that the fields of education, health, and social services account for over 70% of all nonprofit employment.

                        In India, a survey…shows that education, social services, and culture and recreation account for, respectively, 40%, 19%, and 19% of nonprofit activity, and that only 8% of the organizations are engaged in developmental work per se. 

                         

The nonprofit sector in the developing world extends well beyond NGOs, and also receives its funding from sources which go well beyond the traditional development assistance that is often identified with nonprofit organizations in these areas.  In India, for example, while some 15,000 nonprofit organizations registered with the government received $460 million in foreign assistance as of the early 1990s, the majority of revenue actually comes from domestic sources, much of it in the form of fees and charges.  Similarly, a survey of nonprofit organizations in the state of Rio de Janeiro revealed that fees and charges are more important than funds from abroad in financing nonprofit activity.  In fact, the really distinctive feature of nonprofit finance in the developing world may not be the relatively higher levels of outside aid so much as the relatively smaller levels of government support.  Whether this is a permanent feature or another sign of the stage of development of the sector in these countries is one of the most crucial issues for the future. The significant level of government support to nonprofit organizations in India suggests, however, that the latter may be the case.

References

Bremner, R.  Giving:  charity and philanthropy in history.  Transaction Publishers.  1994.

Critchlow, D. and Parker, C.  With us always:  a history of private charity and public welfare.  Rowman & Littlefield.   1998.

Ilchman, W., S. Katz, and E. Queen.  Philanthropy in the World’s Great Traditions.  Indiana University Press.  1998.

Glossary

Board of directors:  the governing body of an organization, usually elected or chosen from among the group’s concerned parties.

Constituency:  the group of persons who are represented by or who support and/or benefit from the organization.

NGO:   Non-governmental Organization -- an independent, voluntary organisation acting for some common, presumably philanthropic, purpose

Not-for-profit:  the terms non-profit and not-for-profit usually indicate an organization’s exemption from most taxation by the government.  It also indicates that the ownership of the organization does not belong generally to any one individual, but instead to a group of directors.

Philanthropic:  efforts for benevolence instead of monetary gain