Friday 21 February 2014

Out soon: Transparency ratings for charities

New system aims to improve their effectiveness, boost public confidence
The Straits Times, 20 Feb 2014

A NEW system that will give the transparency ratings of charities is expected to be unveiled by the end of the year.

Announcing this yesterday, Mr Lawrence Wong, Acting Minister for Culture, Community and Youth, said the system aims to help charities improve their effectiveness, and create more public support and confidence in them.

Citing findings from a study by the Centre for Non-Profit Leadership published last September, Mr Wong said many charities still perceive transparency and accountability as "something that is good to have, but not a must-have".

But this is a mindset that "needs to change", added Mr Wong, who was speaking to about 300 participants of the inaugural Charity Governance Conference.

The study showed that fewer than half of the 577 charities surveyed made their financial statements and annual reports available online. There are more than 2,000 charities here.

Giving examples of rating systems in the United States, which assess charities on their financial health and accountability, Mr Wong said such systems help donors make informed decisions.

Mr Sim Gim Guan, National Council of Social Service (NCSS) chief executive, agreed, saying that with such a framework here, donors "may even explore contributing to new emerging areas of social concern".

The Charity Council is partnering the National University of Singapore Business School to develop the rating system.

The council - a 15-member committee which promotes good governance practices in the charity sector - organised the conference, which was held at the Holiday Inn Singapore Atrium hotel.

Mr Gerard Ee, former chairman of the National Kidney Foundation, spoke at the conference. He assumed leadership of the NKF in 2005, when the charity was hit by a scandal that exposed lapses in its corporate governance.

He suggested that the relevant parties involved "start off cautiously" in developing the rating system, first by looking at whether financial information is available online, for instance, before considering "qualitative" aspects such as how comprehensive the data is.

Regular donor Andy Chan, 39, said once a rating framework is in place, he will be more willing to donate to less well-known charities. "After the NKF saga, I was quite sceptical, so I donate through ComChest. I want my charity dollar to go to the beneficiaries."

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