China social sector: tools to measure transparency and accountability

The China Foundation Centre (CFC) recently launched the ‘Foundation Transparency Index’ (FTI) at their second annual conference in Beijing on 29th August 2012, which was attended by around 200 local and international industry leaders, and members of the media. The FTI is an online tool that can be used to indicate the level of transparency of foundations registered in China. AVPN attended this landmark event, and was witness to the excitement that welcomed the introduction of this industry benchmark.The FTI marks a turning point in the industry’s resolve to clean up their image amidst a spiral of corruption and nepotism scandals in China involving social sector organisations. Thus, the FTI was conceived partly to address the public’s loss of trust in the non-profits and foundations, and also to promote greater professionalism and accountability with the available access of information about their organisations. Commissioned by the CFC, the FTI platform was developed by the Anti-Corruption and Governance Research Center of Tsinghua University, and incorporated the participation of more than 700 organisations in its pilot phase. At the launch, 1833 organisations were reviewed (China has more than 2,000 foundations).During the conference, many organisations, including The Foundation Center in the United States, congratulated CFC on the launch of the index, as it centralizes and crystallizes industry standards and expectations. In fact, Bradford K. Smith had even commended CFC via correspondence as a role model for the western countries. However, what is worthy to note too was that the commentators were also very forward in their criticisms and questions about the system. The audience was mainly concerned about the reliability and accuracy of the information that was uploaded onto the system.When questioned, representatives explained that the information required came mainly from official documents like the organisations’ annual report and audit reports, which had to be submitted to government and third party organisations. More importantly, they also viewed one of the most important auditing bodies in this structure as members of the public. With the FTI and ranking in place, members of the public can easily access the information, and to conduct further investigation. Hence, the foundations are not only held to account by the index, but are also under scrutiny by the public eye.At the end of the day, all felt that the FTI was a herald of better things to come. Panelists highlighted that transparency should be used as a management model – to be used more as a tool than an end in itself. Ultimately, the industry in China should also progress to adopt efficacy measurement systems for social impact.The China Foundation Center is a member of AVPN. Click here for CFC’s profile on the AVPN member directory.