In the last few decades, recurrent scandals have involved not only the business sector (e.g. the Enron and Parmalat collapses), but also several non-governmental organizations (NGOs) that were supposed to be engaged in charitable initiatives -- e.g. the U.N. Oil For Food Program or the U.N. sex scandals in Sierra Leone, Liberia and New Guinea and financial abuses and mismanagement at United Way of America. As a consequence, individuals have lost confidence in many institutions, even those claiming to have only humanitarian purposes.

While there is no ‘silver bullet’ that will prevent all questionable practices in organizations, transparency -- defined in the business sector as the degree of completeness of information, provided by each company to the market, concerning its business activities (Vaccaro, 2006) -- has been recently advocated as being an important ethical practice able to improve trust and confidence between a firm and its stakeholders (e.g. Vaccaro, 2006; Vaccaro and Madsen, 2006). This increasing societal interest in transparency has been acknowledged by firms around the world. Indeed, Kaptein (2004) has recently showed that the most cited ethics principles in the codes of conduct of multinational companies have to do with transparency, honesty and fairness with the respective frequencies of 55, 50 and 45 percent.

In this context previous studies have showed that information and communication technologies (ICTs) can provide a valuable support to those firms interested in improving their transparency level (Tapscott and Ricoll, 2003; Vaccaro and Madsen, 2006a). In particular, internet-based technologies can assist a firm in increasing the amount of available information concerning its business practices and to create a direct relationship with geographically dispersed individuals.

Despite the rising societal expectations of higher levels of organizational transparency overall and the new opportunities offered by ICTs, current literature has analyzed the perspectives related to this issue primarily in business organizations. With this paper, the authors will analyze the ethical perspectives related to transparency and the related role of ICTs in NGOs. In particular we will address two questions: What are the main ethical challenges that NGOs face in the development of more transparent relationships with society? What is the impact of ICTs on the transparency of NGOs?

In order to reach these research objectives we present two case studies of European NGOs that have extensively adopted and that currently exploit ICTs in support of their activities. They are the Italian and the Portuguese Association of blind people. We present empirical evidence based on a one-year study during which we gathered extensive data from four main sources: direct observations of the web sites, interviews, internal documents and finally, publicly available reports (e.g. reports of trade unions, market studies, etc.).

We show that transparency is intended in the two NGOs as an important ethical value both in their relationship with society as well as in the management of internal resources and activities. In particular, the development of transparent relationships with society is understood as a way to show to benefactors that donations are appropriately disbursed to pursue the humanitarian objectives stated by the NGO. Moreover, we find that in both NGOs higher levels of transparency in the internal relationships are acknowledged as an ethical approach to manage human resources, to solve problems and to   make important decisions. But, improvements of an NGO transparency are not always ethically acceptable. Indeed, various ethical and organizational forces can affect the transparency level of an NGO. We identify five main forces that have a significant bearing upon the level of NGO operational transparency: privacy, security, financial supporters (donors), competing institutions and beneficiaries.

Both of the European case studies that are presented in this paper suggest that improvements in the transparency level of an NGO can raise other ethical and managerial concerns both inside the organization as well as in its relationships with society. For example, the spread of extensive and detailed information regarding NGO activities may incur a violation of the privacy rights of employees and/or beneficiaries and such a violation would be considered a breach of ethical management. By the same token, security concerns can impinge upon the level or transparency that an NGO might achieve and limit the spread of information especially with regard to financial operations such as the transfer of financial payments to individual employee or manager’s bank account. Our results also show that both European organizations carefully control the spread of information regarding their current activities in order to avoid that stakeholders, with their different objectives and needs, will pressure them to show favoritism toward one set of beneficiaries over another. Moreover, the threat of potential and existing rival NGOs can have an affect on the transparency level of such organizations in how they manage their relationships with society. A significant insight of this first part of the work, then, regards the importance of the selection process of the type and kind of information that should be transparent inside and outside the organization and the related role played by the aforementioned forces.

This paper also shows that ICTs play a twofold role in this context. First, the availability of inexpensive and instant media that arises thanks to ICTs force individuals and groups employed by an NGO to improve the transparency of their activities. Second, whenever higher levels of transparency are requested both inside and outside an organization, ICTs are adopted to pursue transparency improvements. We show that this twofold role provided by virtual technologies turns in a circle of “better opportunities” and “higher expectations” that spurs NGOs toward ever higher levels of transparency both in the management of their internal activities and in their relationships with society.

 This paper contributes to the literature in several ways. First, based upon Vaccaro’s (2006) and Vaccaro and Madsen (2006) models, we extend the understanding of ethical and socio-economical concerns related to transparency to the particular context of NGOs. Second, the paper provides an analysis of the contributions and the new perspectives offered by ICTs for the improvement of NGO transparency both in the relationships with society and in the management of internal activities. In this regard, it demonstrates that ICT is a “transformative technology” (Kling, 1991) having the power to change social relationships. Finally, it provides normative recommendations to practitioners and useful insights to scholars for further research.

Kaptein, M. (2004) Business Codes of Multinational Firms: What Do They Say? Journal of Business Ethics, 50, .13-31.

Kling, R.( 1991) Computeration and Social Transformation, Science, Technology, & Human Values 16 (3) 342-367.

D. Tapscott, D. Ricoll. 2003.  The Naked Corporation. Free Press. New York.

Vaccaro, A. (2006). Privacy, Security and Transparency: ICT-related ethical perspectives and contrasts in contemporary firms in D. Howcroft, E.   Trauth , J. I. DeGross (Eds). Social Inclusion: Societal and Organizational Implications for Information Systems, New York, Springer  245-258.

 Vaccaro, A.  and  Madsen, P. (2006).   Firm Information Transparency: Ethical Questions in the Information Age, in: Social Informatics: An Information Society for all?, In Remembrance of Rob Kling (ed. J. Berleur, M. I. Nurminen, and J. IMPAGLIAZZO)  Series: IFIP International Federation for Information Processing, New York, Springer, 145-156.