Creating Transparency and Accountability in Non-governmental Organisations Using Blockchain Technology

Abstract

Non-governmental organisations (NGOs) rely on donations as one of their main sources of funding. The relationship between donors and NGOs is based mostly on trust, donors trust NGOs to be legitimate organisations. One way for NGOs to show donors they are to be trusted, is by being transparent and accountable about the projects they undertake. Blockchain is a new technological innovation that has potential to change the relationships between NGOs and donors. It can be used to create trust between parties without relying on a trusted third party. This research focusses on analysing the relationships in the NGO sector and the methods NGOs currently use to be transparent and accountable. Furthermore, an analysis is made on the capabilities of blockchain technology and smart contracts to improve transparency and accountability in the NGO sector. A review of current literature was conducted, and interviews were held with employees of NGOs and institutional donors. The results showed that blockchain technology’s main potential lies in allowing individual donors to trace their donations. However, this would require significant effort and there is resistance among NGOs to implement such a blockchain. Additionally, the results showed that there are alternative methods to improve transparency and accountability that require less effort and that could have a significant impact.