29
Mar
11

When disaster strikes – how to do no harm and to help well…

When disaster strikes – such as the recent Japan earthquake, tsunami and nuclear crisis – our most innate response is what can I do, how can I help? Our first thought will probably be – how much can I spare to give? Who can I give to? All these responses are probably most acute and convicting in the first few days of a disaster and then for most people, persist and wane depending on the level of media exposure.

If you are a nonprofit organization on the receiving end of the donor’s response, you can imagine the overflow of response and donations that the organization must steward in those first few weeks and the additional onslaught of decisions that must be made in terms of a programmatic disaster response. For a nonprofit, there are many stakeholders to take into account and the level of scrutiny and attention is even more heightened and exaggerated in a disaster situation. Although the speed of response both to the victims of the disaster and to the donors wanting to help is crucial both to save lives and to effectively channel donors’ interests to the disaster area, adequate deliberation and due diligence is necessary in order to implement a sustainable response that will encourage the long term development of the disaster area and prioritization of the well being of victims.

Here are some helpful tips for donors, and some internal control considerations for nonprofit organizations when responding to a disaster relief situation.

 

For potential donors:

What should potential donors know when deciding on how to help in a disaster relief situation?

World Vision has put together a great list of dos and donts for potential donors interested in supporting disaster relief. This list was a worldvision.org blog posting on March 21, 2011.

 

For the nonprofit providing disaster relief services and programs:

What is an appropriate control framework for a nonprofit that receives donations and implements program during a disaster relief situation? I came across two good resources on the internet from the law firm Davis Wright Tremaine and the public accounting firm Ernst and Young.

1. Davis Wright Tremaine (DWT) resource –

The law firm of DWT has long been a valued advisor to the charitable sector. They have recently put together guidelines for charities providing assistance during disaster relief situations. These guidelines take into account the tax implications for compliance with IRS requirements and address the following:

  • Appropriate uses of donations
  • Preserving flexibility of use of donations
  • Grantmaking to U.S. and foreign organizations
  • Employer related disaster relief programs, and
  • Taxation of disaster-relief payments to recipients.

 

2. Ernst &Young framework –

Ernst and Young has put together a framework that provides process maps, controls and flows for humanitarian aid resourcing and delivery – from fund allocation to aid distribution, including the accounting and reporting of these activities. It describes the control points and provides ‘what can go wrong’ indicators for subsequent review and evaluation of internal controls.

In my opinion, it is a good basic framework to use as a starting point. However, it is a simplified version of an internal control framework and as noted in the framework, needs to be contextualized to the organization.

 

In addition to the framework, there are many other contextual considerations that need to be taken into account. When disaster strikes, there is seldom the luxury of time to deliberately make decisions or to perform the amount of due diligence that is typical for most other processes.

3. Personal insight based on experience at World Vision –  

(a) Contextual factors to take into consideration:

– In a disaster situation, there is often a huge amount of need that cannot be met by any one organization

– In many situations, the coordination of aid and relief is under the direction of the government

– Within this context, there could be several constraints on how the nonprofit can operate (e.g. geographical or population limits)

– What is your organization’s strategy when working in disaster situations?

– Short-term relief?

– Long-term development?

– What are the target populations (e.g. women and children, elderly, etc)?

– Where does the organization want to or where can it work?

– What are your organization’s core competencies and what is the greatest value that you can provide?

– What frameworks exist to effectively partner with other stakeholders (e.g. NGOs, Governments, etc) and to work together in a way that is complementary and synergistic?

 

(b) Other control considerations:

– If there is a large donor response, what internal mechanisms are in place to clearly communicate to donors and to revise fundraising strategies once the optimal amount of donor funds have been received?

– What mechanisms are in place to fundraise in a way that facilitates long term development in disaster contexts?

– What internal mechanisms are in place to appropriately pace funding to meet disaster needs to maintain effectiveness of program delivery in the short and long term and to maintain integrity with donor expectations?

– Are fundraising, budgeting, financial and aid delivery processes scalable for a disaster situation – can the process be deployed at the speed needed to respond timely to a disaster situation while at the same time maintaining the necessary controls to ensure integrity and transparency of use of funds?

– Are there low-risk or unnecessary controls within these processes that can be bypassed?

– Are there exception-type processes that need to be created to respond timely in a disaster situation (e.g. exception procurement processes)?

– Can certain vendor contracts and supplies be pre-positioned (whereby the benefits outweigh the costs) in order to respond timely in a disaster situation?

 

These considerations and questions are by no means exhaustive but together with the control guidance provided above by DWT and E&Y, I think they are a good place to start.

Your feedback and insight are welcomed!

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2 Responses to “When disaster strikes – how to do no harm and to help well…”


  1. March 29, 2011 at 8:39 pm

    I wanted to add one comment on the above post. In analyzing a disaster such as the one in Japan, it is also important to consider the affected country’s desire to receive aid and ability to receive aid. One of the best ways to “do no harm” is to follow the guidelines and requests issued by the affected countries government. In the case of an organized country like Japan, an NGO’s strategy should be based upon the affected country’s strategy. Now this may not be true in all countries, as not all governments are as organized and responsive as Japan’s, or have the ability to respond as Japan’s government has done. But it is important to consider the needs and wants of the country first, before imposing “help.”

    In the link below, the UN Office for the Coordination of Humanitarian Affairs (OCHA) has issued a report that makes this point among others:

    “(1) that even though the scale of the damage following the earthquake and tsunami was significant and resulting humanitarian needs remain considerable, (2) Japan is a highly developed country and has, in principle, enough resources as well as the ability to respond to existing humanitarian needs. The country can both produce and procure relief supplies domestically and has the capacity to deliver those supplies to the affected population. Japan has a consolidated disaster management system for disaster response although coordination and logistical challenges have yet to be fully overcome. OCHA’s initial observation is that the need for any further international humanitarian presence or internationally procured relief supplies is limited and any such assistance should only be provided upon the request of the Japanese Government and in accordance with their stated criteria.”

    http://www.reliefweb.int/rw/rwb.nsf/db900sid/ASAZ-8FDGZE/$File/full_report.pdf


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