NGO

Article byWallstreetmojo Team
Reviewed byDheeraj Vaidya, CFA, FRM

Non-Governmental Organization (NGO) Meaning

A non-governmental organization or NGO can be referred to as an organization or group that concerns itself with the larger good of society and aims to alleviate social, economic, political, and environmental issues. Such organizations are not a part of the government and, thus, function independently.

What is an NGO?

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NGOs can be regional, national, or international. This essentially has to do with the objectives of the organization itself. Since they are primarily non-profit organizations, they receive funds from individuals or entities interested in their activities. Also, most organizations cannot provide monetary compensation to employees; hence they prefer volunteers.

Key Takeaways

  • The NGO is a non-governmental organization. It refers to a group of people who come together to form an organization that addresses a social, economic, or political issue and supports those in need.
  • Currently, most NGOs are concerned with issues like women’s rights, climate change, poverty, refugee protection, human rights, war, etc.
  • Prominent examples of such organizations worldwide are the Wikimedia Foundation, Amnesty International, Oxfam, PATH, BRAC, etc.
  • Despite not being governmental organizations, they are vital as they support and ensure equal representation of all communities.

NGO Explained

NGOs are organizations or groups that are considered significant. People with similar interests or concerns come together and offer their support in any form deemed valuable – skills, expertise, experience, funding, time and effort, etc. Due to their role, many governments consider them necessary and support their activities.

In the U.S., the formation of a non-governmental organization is straightforward. A legal approval or incorporation is not necessary until the organization wants to receive donations and be exempt from taxes. They are not heavily regulated, except they must file information regarding NGO funding, activities, etc.

So, let’s understand how they operate. Since they are not business entities, they do not make profits or revenue. Instead, NGO funding constitutes donations from individuals or entities who are well-wishers. For example, an eco-friendly firm funds environmental protection campaigns and activities. However, most NGOs would still not be able to offer salaries to employees, so they work with volunteers who do not expect any payment but believe in the common cause.

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Objectives

Non-governmental organizations have different objectives. These objectives can be social, economic, political, and environmental.

#1 – Social objectives

Examples of social goals include human rights – women’s rights, consumer protection, etc. Worldwide, women are subject to discrimination and lose opportunities due to their gender. Moreover, they quickly become victims of abuse. Hence, many groups work to support women and make them financially independent. A recent example is the United States abortion ban. Many NGOs are working with women to make abortion legal.

#2 – Economic objectives

Poverty is one of the most widespread issues. Almost 9% of the world’s population was in extreme poverty as of 2020. Hence, many groups offer aid to the poor and aim to make people in poorer regions financially stable. In addition, these organizations provide training and re-skilling so that people can manage in the absence of aid and rise above the poverty line. Some groups even have more specific goals – healthcare for malnourished children and education.

#3 – Political objectives

This includes issues like war, refugee protection, etc. Usually, war can make many communities weak. Especially women and children become more vulnerable. The migration of people from the war region is a common scenario. But most of the refugees are not supported by other nations. NGOs work in such areas, and rather than just supporting the refugees by providing them with financial aid, the organizations also help them make a livelihood.

#4 – Environmental objectives

Climate change is undoubtedly a growing area of concern. There are thousands of NGOs working to make people aware of the consequences of global warming and suggesting alternatives to daily-use items that harm the environment. Many groups even help people migrate from places that are becoming less inhabitable. In addition, some organizations are funding research to make regular practices more sustainable.

Functions

Now let’s look at the role of NGOs in specific.

  1. Provide aid – Aid denotes any financial support or other requisites like food, clothing, etc. It is the most natural form of support.
  2. Work with the government – Usually, the government supports other groups that help achieve specific goals that the government cannot address directly. In such cases, the group or organization gets benefits like tax exemption or funding from the government.
  3. Advocate rights – Many organizations work to ensure equal rights for all. Common examples include women’s rights, LGBTQIA+ rights, and the equal representation of black people.
  4. Training – It is impossible always to keep providing monetary aid to victims. This can be due to a lack of funds or the inability to address others facing similar issues. In such cases, the organizations provide training and teach the people to make a livelihood. This will help them be independent and also provide for their families.
  5. Awareness – In case of issues like global warming, non-governmental organizations take it upon themselves to spread awareness. They present facts and fund studies and research to make people understand the issue’s intensity.
  6. Garner mass support – Certain problems require the attention of as many people as possible. For instance, abortion ban, war, abuse, etc. NGOs can mobilize the support and funds required for such issues.

Types

The World Bank classifies NGOs as operational and advocacy organizations. The former focuses on developmental projects, whereas the latter strives to advocate ideas and rights to influence the public. First, however, let’s look at a different classifications of NGO types.

  • INGO (International non-governmental organization) – As the term suggests, such an organization has a global presence and takes up issues that are common on an international scale.
  • ENGO (Environmental non-governmental organization) – This type of organization focuses on environmental issues like climate change and global warming.
  • GONGO (Government-organized non-governmental organization) – Usually, such organizations are backed by the state, thus supporting a repressive government. GONGOs are considered degrading in society.

Examples

Consider the examples of NGOs given below.

Example #1

Human rights are a sensitive issue. History provides many accounts where people were denied their rights. Examples include the holocaust, slavery of Africans, colonialism, etc. In the modern era, too, there are many cases. For instance, the Rohingya crisis, the civil war in Afghanistan, the detainment of Uighur Muslims in China, the suppression of women in Iran, and even the abortion ban in the U.S.

The role of NGOs here is very prominent. Let’s briefly examine the organizations that fight relentlessly to ensure representation and rights. Amnesty International, established in 1961 in the United Kingdom, is a well-known organization advocating human rights. It has over 10 million supporters worldwide.

Human Rights Watch is another notable organization in this regard. It is headquartered in the U.S. and was founded in 1978. It currently works in over 100 countries. Finally, Civil Rights Defenders, founded in 1982, is a Swedish non-governmental organization that has recently been focusing more on the rights of the LGBTI+ community and their discrimination.

Example #2

Here’s recent news concerning international non-governmental organizations in Pakistan. Edhi Foundation is the largest charitable organization in the country. Its chief, Faisal Edhi, recently urged the government to lift the ban on international NGOs in Pakistan. The request came in the aftermath of the floods, which killed over a thousand people in the country.

Edhi Foundation believes that international organizations can provide funds and help rehabilitate people, as they did in the 2010 floods and the 2005 earthquake that hit the country. However, over a decade ago, the Pakistani government decided to ban the organizations, accusing them of activities against the state.

The magnitude of the flood is so great that the government’s response is insufficient. An estimated 15% of the population has been affected by floods, but the government hasn’t been able to reach almost 90% of them. The support of international aid and relief will surely benefit the needy.

NGO vs Non-Profit Organization

Both non-governmental and non-profit organizations do not focus on profits but work for the larger good of society. An NPO can be a business entity aiming not just to make profits. For example, religious establishments open schools and provide free education or education at a lower cost. Hence, even if the organization makes any profit, the amount would first go towards paying off the expenses, and the balance profit, too, would be used only for the NPO. No private entities or individuals will receive the profits.

NPOs can generally be religious, charitable, educational, or scientific organizations. They must benefit society in some way. The critical difference between a non-governmental and a non-profit organization is that the latter conducts business, whereas the former doesn’t. Also, the former can work against political issues, whereas the latter is not supposed to.

Frequently Asked Questions (FAQs)

1. What does an NGO mean?

NGO refers to a non-governmental organization. Various types of NGOs are concerned with social, economic, political, and environmental issues but are not a part of the government. It can be international, national, and regional.

2. How does an NGO work?

Non-governmental organizations work towards fulfilling their objectives. They do this with funds from well-wishers and the help of volunteers who believe in the organization’s cause.

3. How is NGO formed?

In the U.S., an NGO doesn’t need to incorporate. Instead, any number of people with a common social cause can come together to form such an organization. However, if the organization wants to collect donations or be tax-exempt, it must be registered legally.

4. Why is NGO important?

Non-governmental organizations are important as they address many issues on an international scale. For example, there might be common problems faced by multiple countries. In such a scenario, NGOs will be able to mobilize funds. Also, in some cases, the government itself would be the problem, and other countries wouldn’t want to interfere.

This article has been a guide to NGO and its meaning. We explain its objectives, functions, types, and examples and compare it with the non-profit organization. You may also find some useful articles here –

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