The Charities Commission recently released a damning report following its investigation into Oxfam, one of the UK’s largest NGOs. This article discusses the scandal and its detrimental effects on the NGO sector as a whole.
In 2018, The Times newspaper published an article titled "Top Oxfam Staff Paid Haiti Survivors for Sex".
The article made serious allegations against the organisation:
Oxfam allegedly covered up claims that senior staff in Haiti, working after the 2010 earthquake, engaged with prostitutes.
Some of the prostitutes involved may have been underage.
The director of operations in Haiti, Roland Van Hauwermeiren, supposedly used prostitutes at a villa provided by the charity.
There was a subsequent cover-up.
Additional revelations surfaced, including allegations of bullying, harassment, and "colonial" behaviour within Oxfam. It became evident that senior management was either unaware of the situation or incapable of addressing it effectively.
Subsequently, it was discovered that certain implicated senior officers were allowed to resign instead of being dismissed. Furthermore, Oxfam failed to inform prospective employers about the allegations against these officials, and major donors were kept in the dark.
The investigation's findings are alarming.
The charity commission's report concludes that Oxfam consistently failed to meet expected standards, tolerated poor behaviour, and failed to uphold promises made regarding safeguarding, thereby letting everyone down. The commission stated that the incidents in Haiti identified in 2011 were not isolated events, as evidence of behavioural issues emerged as early as June 2010, extending to the use of prostitutes in Chad and 16 serious incidents involving volunteers under the age of 18 in some of Oxfam's UK shops.
The scandal had severe consequences for Oxfam:
A £3.8 million decrease in income from public donations in 2017/18.
The loss of 7,000 regular donors, resulting in an annual loss of £14 million.
A loss of £20 million in government support and exclusion from bidding for new funding.
The suspension of funding by the Swedish government.
The Charities Commission issued an Official Warning Notice to compel Oxfam to address its shortcomings.
An impending £16 million reduction in funding, which will impact staffing levels and aid programs.
The magnitude of this scandal has significant implications for the entire NGO sector, primarily revolving around the erosion of trust. The public's belief that their donations will benefit those in need and that NGO officers will act with integrity is crucial.
Unfortunately, trust is a fragile commodity, and data from the Edelman Trust Barometer suggests that trust in major charities has been steadily declining in the UK since 2013. Incidents such as fraud allegations at Age Concern, the closure of The Kids Company, and the problems at Oxfam have contributed to this decline.
The decline in public trust directly correlates with a decrease in public donations to organisations focused on international poverty and development.
This poses two major issues:
Charities like Oxfam will have to make further program cuts.
Charities will increasingly rely on government funding, making them susceptible to political interference and influence over resource allocation.
The repercussions extend beyond Oxfam, affecting all British NGOs.
Even prominent donors, including financial institutions like UBS, are reconsidering channelling funds into large NGOs due to negative publicity. Experts predict that the Oxfam scandal will have lasting repercussions on the way wealthy donors contribute to charitable causes.
All NGOs must address issues of accountability and transparency to regain public trust. It is imperative for the sector to come together and tackle these challenges head-on. For further information, refer to the Charities Commission's press release, which provides a concise summary of the findings.