Disciplinary perspectives on accountability

Establishing a clear framework for defining and implementing INGDO accountability is not as straightforward as one might think. Indeed, the literature on accountability is diverse, with a multitude of disciplines exerting considerable effort to establish frameworks sympathetic to their thinking. Studies of accountability have been undertaken in a range of settings and disciplines, including the international development literature (Bolling 1982; Clark 1991; Dichter 1988; Drabek 1987; Fisher 1993, 1997; Korten 1990; Lissner 1977; Smillie & Helmich 1993), multi-disciplinary Not-for-profit (NFP) literature (Cornwall, Lucas & Pasteur 2000; Edwards & Hulme 1996; Fox & Brown 1998; Hammack 1995; Kearns 1996; Webber 1999), legal literature (Balda 1994; Chisolm 1995), economic literature (Arrow 1963; Bogart 1995; Burnside & Dollar 2000; Morduch 1999; Mueller 1989; Olson 1965; Stiglitz 1997; Weisbrod 1988), sociology literature (Ezzamel et al. 2008; Fry 1995; Keohane 2002; McDonald 1997; Przeworski, Stokes & Manin 1999), and accounting literature more generally (Carnegie & Wolnizer 1996; Carnegie & West 2005; Gray, Bebbington & Collison 2006; Oakes & Young 2008; Parker 1996; Patton 1992; Roberts 1991, 2009; Roberts & Scapens 1985; Sinclair 1995). Likewise, investigations into the accountability of organisations are not a recent phenomenon (see Normanton 1971). Extensive studies on accountability have thus been undertaken within private sector (for-profit) (see, for example, Ahrens 1996; Emanuel & Emanuel 1996; Hopwood 1974, 1977, 1983, 1990; Miller & Napier 1993; Miller & Rose 1990, 2008; Parker 1996; Roberts 1991; 2009; Roberts & Scapens 1985; Shearer 2002); public sector, (see, for example,

2_{The importance and recency of this area was signalled with a special issue in 2017 on Accounting, nongovernmental organisations}

and civil society in, Accounting, Organizations and Society, with another special issue on NGOs, Accounting and Accountability in

Accounting Forum scheduled for publication in 2019, over a decade after the landmark special issue on NGO accountability published in Accounting, Auditing & AccountabilityJournal in 2006.

Boyne et al. 2002; Carnegie & Wolnizer 1996; Carnegie & West 2005; Cavalluza & Ittner 2004; Davis 2007; 2017; Day & Klein 1987; Ezzamel et al. 2007; Gomes 2007; Gomes, Carnegie & Rodrigues 2008; Gomes & Sargiacomo 2013; Romzek & Dubnick 1998; Sinclair 1995); and third sector organisations (see, for example, Everett & Friesen 2010; Goddard & Assad 2006; Gray, Bebbington & Collison 2006; O’Dwyer & Boomsa 2015; O’Dwyer & Unerman 2007, 2008, 2010; Unerman & O’Dwyer 2006).

Despite the growing significance of Nongovernmental Organisations (NGOs) within the

expanding third sector (Ebrahim 2005) and on-going calls for greater accountability (Agyemang et al. 2017; Cordery et al. 2018; Gray, Bebbington & Collison 2006; Hall & O’Dwyer 2017; O’Dwyer & Boomsa 2015; O’Dwyer & Unerman 2007, 2008, 2010; Unerman & O’Dwyer 2006), little academic research investigating issues of accountability within specific NGO settings has been undertaken (see, for example, O’Dwyer & Boomsa 2015; Unerman & O’Dwyer 2006a). While a few insightful studies into aspects of accountability within

development NGOs have recently been undertaken (see, for example, Martinez & Cooper 2017; O’Dwyer & Boomsa 2015), there are a lack of such studies examining the accountability mechanisms and practices of humanitarian INGDOs, particularly within the Australian context.

Dependent on the disciplinary perspective, accountability has been defined in several contexts and precedents.

Multi-disciplinary NFP literature perspective

Edwards and Hulme (1996, p.967) defined accountability as ‘the means by which individuals and organisations report to a recognised authority (or authorities) and are held responsible for their actions’. In a study into the World Bank and NGOs, Fox and Brown (1988, p.12) likewise described accountability as ‘the process of holding actors responsible for actions’. Cornwall, Lucas and Pasteur (2000, p.3) broadened this perspective suggesting accountability is about being ‘held responsible’ by others and ‘taking responsibility’ for oneself and taking this a logical step further – taking responsibility for those on whose behalf we act.

Legal perspective

Some of the more deliberate language on accountability emerges from the field of law. Chisolm (1995, p.141) defined legal accountability as ‘either an obligation to meet prescribed standards of behaviour or an obligation to disclose information about one’s actions even in the absence of a prescribed standard’. Although the legal framework is important and provides a point of departure from a broader conceptualisation of accountability, it is a highly constrained and fails

to take account of the multiple dimensions not enshrined in law (Ebrahim 2003a; Connolly & Hyndman 2013).

Economic perspective

One commonly advanced explanation for the existence of INGDOs is market and government failure to fill gaps in services not adequately provided by the public and private sectors Weisbrod 1988). According to Ebrahim (2003a) this view of accountability differs from the legal perspective in that it relies not only on external regulation but on the push and pull of constituent interests. As such, accountability may be viewed as relational in nature: it does not stand objectively apart but is reflective of power differentials among organisational actors.

Socio-political perspective

Perhaps most revealing has been the contribution of the principal-agent perspective. This theory is premised on the observation that individuals (principals) attempt to have their agendas carried out by individuals (agents) (Keohane 2002). However, this perspective fails to address incongruent interests and strategically important stakeholders, due to ambiguities and conflict from having multiple principals (key stakeholders). In their historical analysis of American democracy, Weber (1999, p.453) observed that ‘the conceptu alisation of democratic

accountability, rather than being a sacrosanct concept that all can agree on, varies dramatically over time’. Hammack (1995) similarly concluded that the changing context and complexity of NGOs throughout the last century has rendered traditional accountability frameworks largely unworkable.

Accounting perspective

This perspective of accountability requires recourse to the social, economic, political and organisational environment that accounting surrounds and invades (Hopwood 1977, 1983, 1990; Burchell, Clubb & Hopwood 1985; Napier 1989; Carnegie 1993; Carnegie & Napier 1996, 2002, 2012; Gomes, Carnegie & Rodrigues 2008; Ligouri & Steccolini 2011). A number of studies have been undertaken within accounting that investigate the broader implications and mitigating factors giving rise to the motivators of accounting change, in line with Hopwood’s (1983) view that accounting, organisational and social functioning are all intertwined (also see, for example, Gray, Bebbington & Collison 2006; Gray & Haslam 1990; Hall & O’Dwyer 2017; Carnegie & Napier 1996; Martinez & Cooper 2017).

Within this framework, accounting is viewed as a complex force for economic transformation at the organisational, state and global level that conversely is impacted by the social, political, and

institutional environment within which it functions (Gray, Bebbington & Collison 2006). As such, accounting is influenced by various stakeholder motives and agendas (Fowler 2010; Ligouri & Steccolini 2011). Carnegie (2014a, p.1246) surmises:

While accounting … is a technical practice involving recording, measuring and interpreting it is also social practice, as what is measured influences the objectives and related behaviours of individuals and, in the process, produces intended and unintended impacts on organisational and social functioning and development.

Within this diverse environmental context in which accounting resides – and despite this being the subject of a considerable literature – accountability continues to defy precise specification (Gray, Owen & Adams 1996; Gray, Bebbington & Collison 2006; Hall & O’Dwyer 2018; Laughlin 1990; Taylor, Tharapos & Sidaway 2014).

Hopwood (1974, 1977) and Gambling (1977) suggest that in the pursuit of efficiency entities have become obsessed with accountability, albeit a form that is unable to take into consideration heuristic functions such as morals, values and motives (Ahrens 1996). Sinclair (1995) expands on this qualitative approach, suggesting that efforts to enhance accountability should reside in personal experience as the nature of accountability needs to be adaptive to the organisations and individuals (in fact all stakeholders) with which it interacts.

Perspective adopted within this study

More recently, Hall and O’Dwyer (2017); O’Dwyer and Unerman (2010) and Martinez and Cooper (2017) concluded that accountability in the early twenty-first century remains focused on control and justification – leaving the unequal social and economic structures that defined much of the twentieth century almost unchanged (Gray, Bebbington & Collison 2006). It is this conception of accountability – that for the most part differs from the needs of those entities whose objective is far removed from their for-profit counterpart’s fixation on the accumulation of wealth – that is the focus of this study. Providing an all-embracing (Gray, Owen & Adams 1996), broad scope (Parker 1996) and social (O’Dwyer & Unerman 2007) accountability regime3 _{that considers both financial and non-financial objectives. This concept of}

accountability will need to embrace both a qualitative and quantitative framework – a difficult task encamped within a capitalist society focused on the accumulation of capital and

safeguarding of the resources to which INGDOs are entrusted.

3 _{A traditional, historic or entrenched notion of accountability that has held sway in organisational functioning over a period of time.}

The extant literature on various disciplinary perspectives of accountability highlighted for humanitarian INGDOs to make a measurable difference within the realms in which they function, a number of areas of concern must be addressed. Namely, to whom, for what and how are INGDOs to discharge accountability? There are no easy answers to these fundamental questions (see Sargiacomo, Ianni & Everett 2014, p.668; also see Taylor, Tharapos & Sidaway 2014). While some assert that enhanced accountability protocols4 _{(O’Dwyer & Unerman 2008)}

are vital to ensure the on-going viability and success of this sector, others note that this will degrade the ability of these entities to function and further burden the mandate to which they have been given (see, for example Gray, Bebbington & Collison 2006; Martinez & Cooper 2017).

What is certain, is that if the accountability of humanitarian INGDOs is to live up to the vast expectations placed on it, conceptual frameworks and regulatory initiatives must embody all concerned in a manner that is to seldom experienced in the world of development economics and global politics.

Gray, Bebbington and Collison (2006, p.321) reflect what accountability does – and should – mean in such a context, surmising that for accountants, accountability is typically seen as a straightforward – if contested – notion. In contrast, Ebrahim (2003a) suggest accountability is a relational concept that does not stand objectively apart from organisational relationships, while O’Dwyer and Unerman (2007, 2008, 2010) find that accountability remains fixated on control and justification.

This implicit assumption that accountability is a basically straightforward concept is further challenged within this study by the introduction of the notion of beliefs, values and motives – heuristic functions – elusive in recognition and measurement, but critical to ensuring that these entities that operate outside the traditional private and public sectors are able to meet their missions that are often counter-opposed to the incumbent focus on financial returns, efficiencies and a reduction of costs. This is particularly important as the on-going legitimacy, funding and survival of these entities may be dependent on an all-embracing concept of accountability that as yet has defied precise specification and remains to be effectively discharged (see Conway, O’Keefe & Hrasky 2015, p.1078-79; Hyndman & McConville 2018, p.236-37).

In order to transcend this discord, a retrospective approach is taken to ascertaining the role of accountability, whereby organisational functioning in this realm is analysed from an initial

4 _{Accountability mechanisms and practices (internal and external) designed to ‘ensure the veracity of public pronouncements … and}

substantive view in regard to underlying motive and how INGDOs account for their activities. This framework is used to assess the literature on accountability within the third sector more generally, with findings then applied to Australian Red Cross.