Category: Newsletter

NNNGO Newsletter on Understanding the Companies and Allied Matters Act – September, 2019

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Constitutions help set the rules guiding the operation of nonprofits. They are important because they establish procedures that everyone can rely on and give a level of certainty about how the organisation should be run; the rules and processes provided in the constitution binds the board, the organisation and its members. Legally, a nonprofit’s constitution is what the Corporate Affairs Commission (CAC) uses to determine its object and decide if it is indeed, a nonprofit.

The first thing nonprofits need to understand when setting up their organisation or applying formally to the Corporate Affairs Commission is to ensure that their board meets either physically or online to discuss the constitution and agree to its adoption; the minutes of this meeting must be documented for future purposes.

When drafting a constitution, nonprofits should ensure that their constitution states the name or title of the organisation, clearly articulates the aims/objects(charitable purpose) of the organisation, clearly sets out the role/powers of the board indicating their job descriptions, appointment/tenure of office and replacement of trustees, how meetings of the board are called and held and what would happen if the organisation must wind up.

At this point, it is important for the prospective board(trustees) to read the constitution and accept responsibility through a signed document for leading the governance of the organisation and ensuring its effectiveness.

It is highly recommended that nonprofits do not copy and paste their organisational constitution to ensure that the constitution and governance documents accurately reflects their organisations’ peculiarities, situations that are unique to how their organisation operates or will operate; this constitution should contain rules that the particular nonprofit understand and will be able to follow.

Ultimately, nonprofits are required to have in place a constitution that governs its operations and safeguards it for efficient and effective running of day to day activities.  

This newsletter is supported by the Commonwealth Foundation. However, the ideas and opinions presented in this document do not necessarily represent those of Commonwealth Foundation, NNNGO or any other organisations mentioned. 

Pursue Equitable Partnerships and Solidarity – Istanbul Principe VI (September, 2019)

Partnerships among CSOs and various stakeholders are vital to cooperation, collaboration and problem-solving as all these are built on trust, mutuality, accountability and solidarity.

In a bid to pursue equitable partnerships and solidarity, there is a need for CSOs to see themselves as partners rather than competitors. This translates to a commitment to goals, efforts, and problems of other development actors in order to facilitate effective collaborations and information sharing which allows for local, national and global development.

It is important to note, however, that openness among all stakeholders; government, private sector, civil society, and the citizens will minimize the rate of conflicts while ensuring equitable partnerships and solidarity.

The sixth Istanbul principle of development effectiveness states thus – “CSOs are effective as development actors when they commit to transparent relationships with CSOs and other development actors,freely and as equals, based on shared development goals and values, mutual respect, trust, organizational autonomy, long-term accompaniment, solidarity and global citizenship”.

CSOs are encouraged to collaborate with other organisations who share their goals in order to maximize resources to achieve bigger impact. Even though the challenges of partnerships cannot be overlooked, CSOs must develop strong systems of conflict resolution to address disputes and issues that may arise during collaborations.

NNNGO Newsletter on Understanding the Companies and Allied Matters Act – August, 2019

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Nonprofit mergers are becoming a common trend in many countries and are now a topic of discussion among nonprofit leaders, board and funders. Mergers provide an avenue to preserve and strengthen needed service provided by nonprofits to diverse communities.

The Part F of the Companies and Allied Matters Act recognizes mergers; paving the way for nonprofits with similar objects and aims to merge under terms and conditions prescribed by the Corporate Affairs Commission. Lessons from studies and research have shown that mergers; improve image, reputation and public support for nonprofits, increases financial stability and efficiency of operations.

Merging might also help address issues of duplication of efforts and avoiding solvency especially with the difficult economic climate and the fact that the funding terrain for nonprofits is adversely affected.

With the passing of the amended Part F of CAMA, we anticipate an increase in the consideration for mergers by nonprofits to develop greater organizational efficiencies relating to programming, administrative capacity and financial sustainability.

Nonprofit considering mergers should ensure that they fuse with organisations that have similar mission and vision as them, make use of experts in the merger process and seek specialized knowledge on what the structure or emerging organisation, function and legal aspect of the merger would look like.

Nonprofits should also ensure that funders involved in the merger are given the opportunity to give input into the planning; the merging process should be seen as a collaborative one by identifying potential mutual gains that could be realized in the merger. 

This newsletter is supported by the Commonwealth Foundation. However, the ideas and opinions presented in this document do not necessarily represent those of Commonwealth Foundation, NNNGO or any other organisations mentioned. 

The Practice of Transparency and Accountability- Istanbul V (August, 2019)

Transparency and accountability are pivotal to achieving an effective civil society. Transparency refers to being honest and open; by implication, civil society organisations are expected to be clear enough for private and public scrutiny. Accountability is the ability for CSOs to willingly answer and take responsibility for their actions (decisions, activities or policies) and results. This is central to discussions relating to problems in non-profits as they are the two main pillars of good corporate governance and generally guide the way NGOs are operated, regulated or controlled.

Inline with fostering transparency and accountability, there is the need for CSOs to put in place internal self-regulatory mechanisms that serve as a check to their various activities, this is reflected in their governance strategy and structure, human resource and management, project management, monitoring, evaluation and reporting, and their financial management and sustainability.

The measures include – complying with registration and reporting requirements, adopting a core vision, values and mission, electing a board to guide its mission and review its performance, publishing annual reports, documenting administrative procedure, documenting project work plans and budgets, having a monitoring and evaluation system in place, providing sound account of fund management(recording all financial transactions with relevant receipts and supporting documents); putting systems in place to prevent fraud -such as regular audits,two signatures to account; constituent/ stakeholder feedbacks; among others.

CSOs are accountable to the government, donors, beneficiaries (people), partners, mission, board, staff and their fellow CSOs. This fosters responsiveness to the needs of their communities, the people they work with and other stakeholders engaged in development. Hence, proper accountability measures facilitate increase donor and citizen support.

Through advocacy, CSOs have played a critical role in promoting transparency and accountability within the government and the general society which has yielded positive results. However, they have been encouraged to improve their transparency and accountability mechanisms especially due to the increased rate of money laundering and terrorist financing activities that CSOs can be vulnerable to. To maintain public trust, CSOs need to work on improving their level of transparency and accountability.

NNNGO Newsletter on Understanding the Companies and Allied Matters Act – July, 2019

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An important step towards financial growth and the promotion of transparency and accountability within a nonprofit organization is strong financial management. Nonprofit organisations are expected to keep a tight record of their financial and accounting operations as this improves their documentation processes and helps to take stock of their spending. 

Under the Companies and Allied Matters Act, CAMA, nonprofits have an obligation to the Corporate Affairs Commission, CAC, to correctly keep records that explain how the organization spends and receives its money or other assets (day to day transactions). When nonprofits show records of how it runs; it helps the organisation demonstrate to regulators that it is actively operating and working towards its objectives and remains eligible as a registered nonprofit. This practice also helps to show whether or not the organisation is in good financial health and is being run efficiently.   

Nonprofits are to ensure that they keep operational records which will ideally be stated in the statement of accounts prepared by the bank; doing this shows that the organisation is operating as a nonprofit and meeting its obligations under the part F of CAMA and with relevant authorities, stakeholders and donors. Though this process might be delegated, it is the responsibility of the Board to ensure that the organisation’s accounting records are kept and prepared according to relevant accounting principles adopted by the organisation.

The law requires that nonprofits have preserved accounting financial records for a period of six years from the date of the organisation’s inception for effective transparency and accountability processes.

To adhere to this requirement, nonprofits are required to ensure that financial reports, receipts of transactions and all evidences of payments are correctly recorded, allow for true and fair statements prepared  and audited by an audit firm for large organisations while smaller nonprofits can prepare a statement of affairs (a profit and loss account). This document is vital to the process of filing annual returns with the CAC. 

This newsletter is supported by the Commonwealth Foundation. However, the ideas and opinions presented in this document do not necessarily represent those of Commonwealth Foundation, NNNGO or any other organisations mentioned. 

Promotion of Environmental Sustainability (ISTANBUL PRINCIPLE IV) July, 2019

The environment is considered the most important of the three pillars of sustainability, perhaps because the social and economic pillars are largely dependent on the existence of a functional environment. The inability to keep environmental issues in check weakens the other pillars of sustainability, therefore, it is safe to say that working towards a stronger and sustainable environment is key to ensuring a better quality of life, globally.

“Environmental sustainability is concerned with whether environmental resources will be protected and maintained for future generations”, implying that while humans engage in various activities to meet their needs and make life enjoyable, they consider environmental protection and desist from acts that cause damage to the environment or deplete resources that cannot be renewed.

In promoting environmental sustainability, civil society actors should ensure that in the course of balancing local and global efforts to meet basic human needs, the natural environment should not be destroyed or degraded as keeping the environment safe in order to sustain future generations is a commitment that everyone needs to be part of. Civic actors must, in actions and speech, encourage sustainable living- actively involving in the maintenance of factors and practices that contribute to the quality of the environment on a long-term basis.

When all the three pillars of sustainability are strengthened, people live in a system where high-quality life is the norm. They have a clean healthy environment, a satisfactory level of economic well-being and a robust level of social fulfillment.

CSOs are effective as development actors when they develop and support policies that promote environmental sustainability and encourage more sustainable environmental practices. Such as- moving toward renewable energy (like solar)instead of relying on non-renewable energy sources (like coal and power plants)which create pollution and alter the earth’s atmosphere.

A common approach needs to be agreed and; the people and the government should be aware of the damages their actions can inflict on the environment and the precautionary measures that need to be taken. This will go a long way in protecting both the social and economic aspects of society.

NNNGO Newsletter on Understanding the Companies and Allied Matters Act – June, 2019

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In a nonprofit organisation, managing a bank account can be simple or complex depending on the size of the organisation, the net worth and assets possessed by the organisation.

By law, a nonprofit organisation is mandated to have a bank account from which all financial transactions relating to the organisation would be made. This bank account is strictly for the organisation and separate from the personal account of the founder or staff of the organisation. This is particularly important as it is part of transparency and accountability processes towards the financial growth of the organisation.

An incorporated trustee runs the risk of being dissolved if it is observed by a bank that the organisation operates a dormant account as defined under the relevant banking regulation. The length of time before a bank account goes inactive in Nigeria is 12 months and is classified dormant if it remains inactive for another 12 months; the bank then notifies the Corporate Affairs Commission (CAC) to take further actions requesting that the said nonprofit organisation provide evidence of its activities with an ultimatum of 15 days.

Failure to respond satisfactorily within 15 days of request may lead to the dissolving of the organisation by the commission. Before accounts are reclassified, the banking institution will notify said organisation, 3 months before an account is reclassified as dormant.

Dormant accounts are evidence of no activity for a long period of time. A dormant bank account signals to regulators and the public that the organisation is no longer in existence. Nonprofits not operating their bank account for up to 5 years at a stretch may send a signal to CAC processes for revocation of registration.

To safeguard funds in the account where an organisation has not responded in 15 days, the law provides for the money to be declared/or brought to the attention of the CAC who then sets up processes of transferring the money to other nonprofits with similar purpose upon the approval of the minister.

It is advisable that a nonprofit organisation with a dormant account sends a notification stating the reason(s) for having a dormant account to the CAC to avoid the assumption that the nonprofit organisation is no longer in operation which could further lead to “de-listing” of the organisation from the list of registered organisations with the commission.

This newsletter is supported by the Commonwealth Foundation. However, the ideas and opinions presented in this document do not necessarily represent those of Commonwealth Foundation, NNNGO or any other organisations mentioned. 

Citizens’ Empowerment, Democratic Ownership and Participation (Istanbul Principle III) June,2019

Article 21 of the Universal Declaration of Human Rights (1948) states that “everyone has the right to take part in the government of his country, directly or through freely chosen representatives”. Thus, the onus lies on citizens to participate in the election process (by voting and campaigning for candidates) and holding elected officials accountable, in order to actively participate in a democratic society.

For democracy to be representative, the citizenry needs to be informed and politically active –Citizen participation in democracy provides private individuals an opportunity to influence public decisions and to be a component of the democratic decision-making process. Such a relationship between the state and her citizens is enhanced through participation and accountability to foster democratic ownership of public resources.

Poverty is more than just a lack of resources; it is a lack of empowerment – Hence, CSOs need to champion the cause of social, economic and political empowerment of the citizenry. They have a role to play in promoting grassroots participation in politics through multi-stakeholder dialogue, capacity development/ public enlightenment campaigns and citizens mobilization. This will help amplify the voices of citizens to hold the state institutions and service providers to account.

CSOs bridge the gap between the state and individual citizens – Overtime, NGOs have played a role in advocacy and empowerment. They have been actively intervening in democracy-building especially in mobilizing and supporting social movements. Also, they play a pivotal role in building capacities of citizens in raising national issues.

CSOs are effective as development actors when they support citizen empowerment, democratic ownership and participation through creating spaces for engagement to influence planning, budgeting and policy making processes for inclusive grassroots participation.

NNNGO Newsletter on Understanding the Companies and Allied Matters Act – May, 2019

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The new amendment to the Part F of the Companies and Allied Matters Act (CAMA) supports the suspension of an organisation’s board of trustees, in cases where there is perpetration of misconduct and fraudulent management of organisational affairs.      

The suspension of trustees can only be made legal after a petition has been made to a court of law and evidences presented to the court by one-fifth of the organisation’s members. The Corporate Affairs Commission (CAC) then enforces the court’s judgment of suspension after the individuals have been found guilty.  

The law states that in such cases, an interim manager could be appointed to manage the affairs of the organisation, pending when all matters are resolved. It becomes necessary to appoint an interim manager to ensure the protection of the organisation’s interest and physical properties of a nonprofit organisation. In these cases, the powers and duties of the board of trustees shall be transferred and performed by the interim manager to the exclusion of the trustees under the supervision of the CAC.  

It is important to note that the law does not tolerate deliberate and unsubstantiated accusations and petitions of misconduct or fraudulent dealings by Nonprofits. Nonprofits are advised to avoid disputes and issues that can bring discord within their organisation and the wider nonprofit community at large. 

To achieve the avoidance of organisational discord, it is advised that nonprofit organisations ensure that their operations and financial management activities are guided by the values of ethics and culture of transparency and accountability. 

This newsletter is supported by the Commonwealth Foundation. However, the ideas and opinions presented in this document do not necessarily represent those of Commonwealth Foundation, NNNGO or any other organisations mentioned. 

Promoting Women’s and Girls’ Rights Through Gender Equality and Equity (May, 2019)

Promoting Women’s and Girls’ Rights Through Gender Equality and Equity

In order to achieve Goal 5 of the Sustainable Development Goals, women must be able to influence the socio-cultural, political and economic policies that relate to their issues through various forms. Issues which include but are not limited to; ending all forms of discrimination and violence against women; eliminating all harmful practices (such as child, early and forced marriage and Female Genital Mutilation (FGM)); empowering mothers; giving proper value to ‘women’s work’ involving women in politics; gender mainstreaming; among others.

In line with the second Istanbul principle, Civil Society Organisations (CSOs) have a role in advancing women’s rights to promote socio-economic and political participation while supporting women’s efforts to realize their individual and collective rights, participating as fully empowered actors in the development process. Hence, the need to embody gender equality and equity while promoting women’s and girls’ rights. 

In Nigeria, CSOs have been working in synergy with the government at various levels on gender mainstreaming and campaigning against inequalities to end all forms of discrimination against all women and girls everywhere. To this end, efforts have been made by the government in conjunction with CSOs to put in place necessary mechanisms to ensure gender equality and equity by curbing gender discrimination and violence. 

Some of the outcomes include the adoption of a framework and plan of action for the National Gender Policy in 2006 to reduce cases of Gender-Based Violence (GBV); a project to stop child marriages in Nigeria which was launched in Abuja on November 29, 2016, known as the “National Strategic Plan to End Child Marriage in Nigeria” the Violence Against Persons Prohibition Act of 2015, which prohibits FGM, harmful widowhood practices,harmful traditional practices and all forms of violence against persons in both private and public life. 

Furthermore, some states in Nigeria have enacted laws and created offices in response to GBV, such as, the Lagos State Domestic andSexual Violence Response Team (DSVRT), established in 2014; and the Ekiti state Gender-Based Violence (Prohibition) Law, 2011 which covers diverse types and forms of violence. 

To ensure speedy dispensation of justice, Lagos State Government in January 2018, inaugurated four special courts solely for the prosecution of sexual offenses and corruption cases. Two courts will adjudicate on special offenses (economic and financial crimes), while the two others will try sexual offences. 

The Federal Ministry of Women Affairs and Social Development is charged with the responsibility of working with relevant stakeholders, particularly CSOs to ensure Nigerian women are involved in the national development processes. 

CSOs have played even more important roles in achieving gender equality and empowering women and girls especially in advocacy and awareness on GBV. As a follow-up, they provide support for victims of domestic violence, organize training programs for female lawyers to defend women’s rights on domestic violence in court, empower women through various skills acquisition to actively participate in economic activities and exercise their economic rights and lots more.

Currently, historical and structural inequalities that have allowed oppression and discrimination to flourish are being exposed like never before. However, despite these efforts, gaps in gender inequality still exist in Nigeria. A lot has been done but a lot more needs to be done.