Introducing a New Stakeholder Class: APEs (Part 1)

Time to Differentiate Activist Policy NGOs from Civil Society

German translation

The evolution of Non-Governmental Organizations (NGOs) as a stakeholder class has undermined our perception of what they do, how they are funded and where their activities are scrutinized. Most people still think of NGOs as organizations of volunteers committed to feeding the hungry, housing the homeless and protecting the vulnerable. But what about the lobbyists and lawyers acting under the NGO banner unilaterally trying to interrupt policies and regulations that, in doing so, will make life more expensive and less convenient for those vulnerable people NGOs were meant to protect?

Many of these large NGO organizations have abused their non-profit status to move large volumes of campaign funding around (without any demand for transparency), work as lobbyists (although they refer to it as “advocacy”) and pretend to represent civil society (while no longer keeping memberships or dialogue with society). With budgets often in the tens of millions presented on a simple annual balance sheet, most NGOs have gone beyond the original nomenclature. In any rational world, these activists are not NGOs.

It’s time for a new stakeholder class or category to stop the political abuse of the title: Non-Governmental Organization.

In my last article in the Firebreak, I translated 551 questions from the CDU-CSU German parliamentary inquiry into NGO funding and transparency. One question the parliamentarians routinely asked of each politically motivated NGO receiving German government funding is how their NGO compares to other non-profit organizations like food banks or the Red Cross. This is what most people think an NGO is (volunteer-based, humanitarian civil society organizations helping populations that fall through the cracks of government support). So these divisive political protest movements, hiding behind the NGO title, have been undermining the reputation of legitimate NGOs. This first part differentiates APEs from NGOs. Part 2 will look at the rules and codes this new stakeholder class will need to respect.

The groups the German parliamentary inquiry were questioning were large international organizations with massive lobbying budgets, think tanks and umbrella networks that re-grant funds to their interest groups (on behalf of foundations and other interest groups). While some of these institutions were incensed to have their status as NGOs questioned, hiding behind the benefits of a confused public perception, such political activists and protest groups should not be classed with humanitarian organizations like food banks, homeless shelters or disaster relief organizations. They are, simply put, not NGOs.

By defining a new category within the stakeholder arena, we can better situate the place these activist groups represent and the rules of the game they need to respect. At present, most policy issues or regulatory consultations are divided by certain groups: government, industry/business, NGOs and the academe/research communities. The NGO category should be divided into “Non-Governmental Organizations” (the civil society groups commonly seen to be supporting the vulnerable populations in the field) and a new category we could call “Alternative Policy Enterprises” or APEs for short.

Alternative Policy Enterprises (APEs)

Alternative Policy Enterprises are politically-driven groups that operate outside of government or regulatory structures (ie, they are not elected officials accountable to the public), hence offering “alternative” voices in the regulatory process. They are focused on policy, regulations and governance issues rather than supporting populations in need in the field (thus the term “policy”). And they are “enterprises” or businesses managing significant budgets that need to be scrutinized in the same way as industry budgets are.

For APEs, policy wins (as in changing regulations) are the key objective. They are often driven by political dogma, protest campaigns and a drive to change regulations to reflect their idealized worldview. Greenpeace, a classic APE, continues to campaign against nuclear energy, GMOs and conventional farming even though there is convincing evidence that the consequences of their strategies is seriously harming humanity and the planet. They take their victories back to their funders in hope to increase revenues. In a clear distinction from NGOs like medical relief organizations and women’s shelters that try to make the world better, APEs concentrate on winning in the political arena (whatever the costs).

Some would argue that it is important to change policies to improve the world, protect the public and save the environment, but as these activist campaign organizations evolved, they lost important, experiential skillsets. Most APEs are run by lawyers, consultants and policy experts who have little knowledge of what happens in the field.

Examples of APEs

Policy-driven NGOs

Given the power of the dominant sustainability narrative over the last 25 years, when people think of NGOs, they often consider environmental NGOs like Greenpeace, Friends of the Earth, Environmental Working Group, Environmental Defense Fund, World Wide Fund for Nature, Natural Resources Defense Council... The campaigners click PowerPoints in expensive suits rather than planting trees; they lobby on policy issues rather than supporting nature clean-up operations; and in some cases, spend more on fundraising than on programs. They are commercial organizations selling products, logos, labels or partnerships in order to fund their global brand growth. Similar practices are seen in NGOs managing human rights, animal rights, health, labor and development issues where the political rhetoric is more anti-capitalist than pro-society or pro-development.

Foundations, Trusts and Regranting Funds

Foundations are no longer identified as philanthropic bodies distributing funds to support vulnerable populations, alleviating poverty in developing countries and funding the arts, education and research. The Firebreak has been examining the trend in “professionalizing” philanthropy, with external consultants and fiscal sponsors managing funds and running campaigns to maximize the impact per dollar. Some fiscal sponsors, like Effective Ventures, have fund managers who have developed algorithms to determine the best bang for the buck (minus commissions of course). Foundations also take money from other donors, anonymize it, bundle it up with other programs or foundations and develop deep-pocket campaign strategies. Given the volume of foundation giving (following the growth in the number of tech billionaires), the fiscal sponsors have needed to be more creative, setting up further regranting organizations (baby foundations) to spread the funds and influence longer and wider.

Media Organizations

Journalism and reporting used to be a profession, with skills and codes of conduct. I taught my last course to journalism students twelve years ago. Today journalism is closely tied to activist campaigns and special interest groups. Investigative (freelance) journalists write more grant applications than articles. The Firebreak has shown how foundations are now directly funding campaigns in news organizations like the Guardian or the New York Times, turning their reporting into products integrally tied to activist agenda. There are now discreet fiscal sponsors set up by multiple foundations to fund and train journalists to report on their interests. The media is no longer the Fourth Estate – it is an APE.

Transnational Organizations, Agencies, Institutions

Many UN bodies from UNICEF to the WHO to the FAO act more like activist groups, concentrating on fundraising from foundations and individual donors, running campaigns and promoting their networks on policy debates. The political ambitions of actors involved in WHO agencies like the International Agency for Research on Cancer (IARC) (closely tied to another APE, the Ramazzini Institute), or their Non-Communicable Diseases Unit (following their Lancet program campaigning to control the Commercial Determinants on Health - CDoH) make their activities resemble activist NGO campaigns to try to influence government policies (defined superficially as “members”). Other groups like the World Economic Forum, the OECD or the World Trade Organization also fall under this category although they could be closer to another APE category of think tanks and research institutes.

Universities, Think Tanks and Research Institutes

Universities and opportunistic researchers have set up tax-deductible non-profit entities on campus to attract funds, policy discussions and influence. Take Vermont’s Bennington College. An adjunct who had left her job at the EPA set up Beyond Plastics via a tax deductible account at Bennington (where administration charges usually take 30% off of all external funding grants). Bloomberg Philanthropies pretends to fund Bennington College when his millions in donations are earmarked for the radical campaigns of the anti-plastics movement. Bloomberg plays the same game at Bath University, funding an anti-vaping campaign behind the scenes. The Firebreak also investigated how four professors set up labs at their universities (calling them partners) to channel dark money for the Heartland Health Study. The debate today in the US to remove university tax deductible status reflects these types of activist shenanigans.

Trade Associations and Trade Unions

Activists have always argued that industry trade associations are not legitimate NGOs. True – they are APEs, active in policy debates and representing their stakeholders’ interests (just like the activist campaign groups are doing). By changing the nomenclature to focus on what they are doing rather than how some opportunists want to see themselves, it becomes clear that trade associations and policy-driven NGOs are two sides of the same coin (and should be subject to the same rules and codes of conduct). Trade unions likewise represent their members on policy issues although they have lost influence under the present stakeholder dialogue divisions dominated by policy NGOs with deeper pockets. In an APE structure, with more controls on the manipulation and abuse activist NGOs have extended, trade unions should be able to regain some of their voice in the policy process.

Non-Governmental Organizations

The term NGO should only be reserved for those humanitarian organizations operating in the field, proactively answering needs where governments have failed to act. That is the “Non” in Non-Governmental. This returns the stakeholder group to its original identity, away from the politics and protests and closer to the objectives of support and service. In restricting policy-driven activist campaigners (see Part 2), foundations will hopefully return to providing more funding and opportunities for the legitimate NGOs.

• Improving diets and sanitation in developing countries is not as sexy as saving the planet from catastrophic climate change;

• ensuring clean drinking water and access to affordable energy gets lost in the big picture campaigns against chemicals and fossil fuels.

• providing medicines and vaccines in developing countries would be easier if activists in the WHO and certain NGOs would lift their dogmatic embargo against working or communicating with pharmaceutical companies.

APEs have distracted the funding world from the pragmatic NGO solutions in the field, channeling much-needed humanitarian funds toward their global protest campaigns targeted at policymakers.

As Bjorn Lomborg has consistently argued over the last 25 years, also via his Copenhagen Consensus Center priorities, our limited funds should go toward improving water, sanitation, nutrition and access to simple medicines and vaccines that the NGOs in the field are fighting for, rather than being wasted on useless climate campaigns that are sucking up billions in funding while redirecting misguided policymakers through a well-executed lobbying strategy.

Separating the APEs from the NGOs should hopefully highlight the differences and allow pragmatic leaders to abandon the absolutist activist dogma and go for the quick, easy improvements that will make a greater difference for the people and planet.

There are also many types of organizations that fit under this more limited NGO class.

Civil society groups supporting the vulnerable

Vulnerable populations is a wide category but organizations that support the homeless, the poor, those in distress, those in need of relief, aid, food, mental and physical health support ... can legitimately be considered as NGOs. These humanitarian organizations aim to improve conditions, alleviate suffering and respond to crises. They are usually not political or policy-driven thus they often less vocal and too often under-represented in dialogue and decisions on funding.

Service clubs

Every day in every community, there are volunteers from service clubs caring for the elderly, supporting people with intellectual disabilities, donating and handing out food in shelters, paying tuitions to gifted young students and using their professional skills in clubs to improve life in their communities. Service clubs like the Lions, Rotary, Kiwanis... have been supporting their communities for more than a century. The FT had declared Lions International as the best managed NGO in the world. But as activist groups have sucked much of the oxygen out of the room with their well-marketed “End of Days” campaigns, funding and engagement in service clubs has declined to the point where the service clubs are often dismissed as social clubs for old people.

Conservation groups

I feel I live in the best commune in the world. Conservation groups are constantly developing nature trails, renovating water systems, promoting wildlife habitats and managing waste projects. The ecologists (the experts in the field) built an impressive floodplain that doubles as a park. Conservation groups are leading the charge in protecting biodiversity, planting trees, cleaning up beaches... While environmental APEs complain how the planet is burning and barren (as they fly first class to their next meeting), conservationists are working to restore or enhance our natural heritage.

Faith-based organizations

Churches, mosques and synagogues play an important role not only in a public’s spiritual life, but also in supporting the local communities, providing food and shelter, supporting groups in need at levels which governments are unable to meet. Religious organizations are often the first point of contact for need and support in communities both locally and globally; their facilities serve as shelters and sanctuaries; and their funds can be spread across global networks faster than any government aid program ever could. Without much promotion or demand on others, faith-based organizations get the work done.

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There are, of course, some grey areas where NGOs in the field have policy offices or where APEs have projects that do advance the situations of vulnerable people. Groups like Médecins Sans Frontières or Oxfam use their experience on the ground to advance policy solutions (and are usually more respected in regulatory arenas than the plain vanilla APEs … except when their directors are behaving badly). As the two categories start to be consistently applied, the different organizations should fall within their better defined roles and responsibilities.

So What !

Many activists would argue that this distinction is unnecessary and unwarranted (and just another attempt to denigrate people working hard to protect civil society). In the last Firebreak article on the analysis of German government funding of political NGOs, the strong reaction by certain activist groups trying to defend their NGO status was telling. The campaign groups benefit highly from being classed as NGOs. But …

• should these political activists and lobbyists enjoy the same benefits, given how different they are to the humanitarian groups doing the hard work in the field?

• Should groups earning 100s of millions of dollars be free from tax obligations or strict accounting requirements?

• Should these APEs not be held to the same transparency rules because, in pretending to be NGOs, they hide behind a trust halo?

• Should politically-motivated activist groups benefit from government funding?

They are not NGOs and should no longer be entitled to enjoy the benefits without any obligations or responsibilities. These are the points to be considered in Part 2 of this analysis.