Series: The Accountability of Corporate Accountability International « | Richard Telofski on "The War on Capitalism"

Corporate Accountability International Rates Low on Accountability Reporting

This entry is part 1 of 3 in the series The Accountability of Corporate Accountability International

Corporate Accountability International (CAI) is a non-governmental organization (NGO) that “demand(s) direct corporate accountability to public interests.” Indeed, in their “Standards of Political Conduct for Corporations,” CAI says that corporations must “be more transparent about their activities” and calls for “independent oversight” of corporations. Some of the companies CAI has targeted in the past are Mc Donald’s, Burger King, KFC, and Nestlé.

Those mission statements certainly make sense given the name of this organization, don’t they? And this $3.7 million dollar per year operation goes to great lengths to support that mission. I’ve seen extensive documentation of their campaign efforts given in their annual reports and newsletters and you can see it there too. But what I haven’t seen in those reports and newsletters, nor will you, is information detailing the accountability or transparency of Corporate Accountability International itself. Ironic isnt’ it?

It’s ironic that an organization calling for the accountability of other organizations makes little to no effort to provide information about their own accountability to act in the public interest. I’m speaking of the public interest which they declare to protect as shown on page 32 (PDF version) of Corporate Accoutability International’s booklet “30 Years of Setting the New Standard.” On that page is the quote “we must continue to adjust and act – always representing the needs of people worldwide.”

Such a claim is, of course, not unusual for an NGO. It’s pretty much boilerplate. We expect NGOs to make those types of claims, but few, if any, actually back up their claims with information on their own accountability. I have written much on the subject of the accountability and transparency of NGOs. No NGOs that I have researched meet a high standard in this area and Corporate Accountability International is no exception. Let me explain my findings, or I should say lack of findings, for you, starting at the macro-level.

What I mean here by the macro-level is the employment of a larger organization through which NGOs can report their accountability and transparency. Sort of a “monitor of monitors,” if you will. Such an organization exists. I’ve written about it before on this blog. It’s called the Global Reporting Initiative. As I’ve written before:

“The Global Reporting Initiative (GRI) ‘is a network-based organization that produces a comprehensive sustainability reporting framework that is widely used globally. . . . GRI’s core goals include the mainstreaming of disclosure on environmental, social and governance performance.’ Via the GRI, many corporations, labor, academic, and professional organizations report to the world their positions on environmental, social, and governance (ESG) issues. To improve this process for NGO (non-governmental organization) reporting, during May 2010 the GRI created the NGO Sector Supplement, which was a framework modeled on other GRI report structures, affording NGOs a way to better report their accountability and sustainability positions to their stakeholders.”

The

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Corporate Accountability Intl. Stretches a Claim

This entry is part 2 of 3 in the series The Accountability of Corporate Accountability International

Corporate Accountability International (CAI), a Boston-based NGO, makes the following claim on PDF page 9 of their publication “30 Years of Setting the New Standard.”

Members range from doctors to students to teachers to members of faith communities and provide 90 percent of our funding.

This claim gives the impression that CAI is 90% supported financially by individuals and not by organizations. Certainly, that’s an admirable position for an NGO to be in. Such financing adds to the much coveted “grassroots” caché. But is the claim true? Is CAI actually 90% supported by individual donors?

If you’re thinking “I suppose it’s not true, otherwise why would Richard be writing about this?”, then you’re right. Since companies have their claims challenged frequently, I thought I’d be different and challenge a claim of an NGO that doesn’t get as much oversight.

The CAI claim of 90% individual donor support is not accurate. Let me explain how I discovered this.

How I Discovered This

As I’ve noted in my previous post about Corporate Accountability International, this organization has published a listing of their donors. So, I used this information to test the accuracy of their 90% claim. The list of donors I chose as a sample to analyze appears on PDF page 11 of CAI’s 2010 annual report. The donor list contains names of individuals and foundations and corresponds to CAI’s 2009 fiscal year.

The contributions of individuals are private information that is not required to be released to the public. But, the contributions of foundations are public information and can be seen on the donating foundation’s Form 990, a publicly-available tax return document required for annual filing by non-profit organizations in the United States. Foundations qualify as non-profit organizations.

The 2010 annual report’s list of donors is broken down into contribution ranges. The first range contains donors contributing over $5,000. The second range contains donors contributing between $1,000 and $4,999. There are other ranges, but their contribution ranges are smaller. Since I was just trying to get a “ballpark” estimate on whether the 90% claim was true, I chose to concentrate on the first two ranges only. And anyway, after examining the total list I found that most of the foundations donating to CAI fell within the first two ranges, so that was another reason to just concentrate on only those two ranges.

In the two ranges on this list I identified 30 foundations for research. I used Guidestar.org to access each foundation’s Form 990. (Guidestar.org is a great free resource for this type of information.) Here’s what I found.

What I Found

Of the 30 foundations in the first two ranges on the donor list, there were 14 for which I could identify no donations to CAI. This lack of information was due to mainly two reasons. First, for some of the foundations shown in the donor list I simply could not find any Form 990s for the organization’s name as shown. Second, for some of the other foundations, I found

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Is CAI As Widely Supported As They Say?

This entry is part 3 of 3 in the series The Accountability of Corporate Accountability International

Today’s post continues from my previous post, “Corporate Accountability International Stretches a Claim,” where I demonstrated that in 2009 the NGO Corporate Accountability International (CAI) received 80%, or less, of its funding from individuals. This was in contradiction to a claim by CAI that it received 90% of its funding from individuals.

In this post, I’ll take the examination of CAI’s funding a bit further. Today’s look at CAI funding will be focused on the concentration of the remaining 20%, which is donated by organizations. Further research shows that three-quarters of that 20% (i.e., 15%) came from only two organizations.

One of those contributing organizations, the Richard and Rhoda Goldman Fund, in 2009 donated $300,000 to CAI. Click here to see the documentation, then scroll to page 22 on the PDF. The other contributing organization, the Deborah Rose Foundation, in 2009 donated $250,000 to CAI. Click here to see the documentation, then scroll to page 14 on the PDF.

Please consider that for fiscal year 2009, CAI brought in a bit over $3.7 million in revenue and when the simple arithmetic is done (($300,000 +$250,000) / $3.7 million = 14.86%), it’s clear that CAI received a significant portion, about 15%, of its funding from only two sources.

This finding further adds to the doubt expressed in “Corporate Accountability International Stretches a Claim“ that CAI, an influential NGO, is as widely-supported as perhaps they would like the public to believe.