Governance Practices and Performance of Local Non-Governmental Organizations in Ethiopia

Abstract

Good governance is essential for NGOs to maintain public trust and deliver on their missions. This study examined key good governance practices, including board composition, leadership styles, resource mobilization and stakeholders’ engagement on performance of local Non-Governmental Organizations in Ethiopia. The study also assessed the moderating effect of government regulations on the relationship between governance practices and performance of local Non-Governmental Organizations in Ethiopia. The study utilized a mixed-methods approach (descriptive survey and correlational research designs) to collect quantitative data using a survey questionnaire. The study’s unit of analysis was the local NGOs in Ethiopia, while the units of observation were the CEOs and board chairpersons of the sampled organizations. The target population of this study was 2,201 local NGOs in Ethiopia. The sample size was 327 local NGOs. Systematic sampling technique was used. Suitable responses for analysis were received from 475 out of 654 questionnaires distributed. Of these, there were 276 responses from CEOs and 199 from board chairpersons. SPSS aided in data analysis which was both descriptive and inferential. The study reveals a significant positive effect of governance practices on performance of local NGOs in Ethiopia. The study also showed that the boards lacked diversity (male dominated) and clearly constituted sub committees. In addition, combinations of leadership styles were used by most leaders with transformational leadership style being more prevalent. Further, although overreliance to donor funding was established, the study revealed a satisfactory stakeholders engagement. This study offers useful insights into the existing knowledge by investigating the relationship between governance practices and the performance of local NGOs in Ethiopia. The findings of this research provide valuable insights for NGOs, policymakers, academicians, and other stakeholders, enabling them to develop effective strategies for governance that can enhance the performance and impact of NGOs. Nonetheless, the findings were based on cross-sectional data, local NGOs in Ethiopia and internal stakeholders. Future studies should consider use of panel data, data from international NGOs in Ethiopia, NGOs outside Ethiopia and as well as views from external stakeholders for the conclusions to be more comprehensive.