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Non Governmental Organization Setup

Kakakhel Law Associates | Non-Governmental Organization (NGO) Setup - Pakistan

A Non-Governmental Organization (NGO) is a non-profit, voluntary citizens' group organized at local, national, or international levels. These organizations are task-oriented, driven by people with common interests, and perform a variety of services and humanitarian functions. NGOs play a crucial role in bringing citizens' concerns to governments, monitoring policies, and encouraging political participation at the community level.

NGOs provide analysis and expertise, serve as early warning mechanisms, and help monitor and implement international agreements. Many NGOs are organized around specific issues, such as human rights, environmental protection, or health.

A Non-Governmental Organization (NGO) is a legally constituted entity created by private individuals or organizations, with no participation or representation from the government. Even when NGOs are funded entirely or partially by governments, they maintain their non-governmental status by excluding government representatives from membership. While most NGOs operate at the grassroots level, engaging directly with communities, others focus on policy analysis, early warning systems, and the implementation of international agreements.

The World Bank defines NGOs as "private organizations that pursue activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social services, or undertake community development." It adds that NGOs are typically value-based, relying on charitable donations and voluntary service. While the sector has professionalized over the years, altruism and voluntarism remain fundamental principles.

Terms Used for Non-Governmental Organizations In addition to "NGO," various alternative terms are used, including:

Independent Sector Volunteer Sector Civil Society Grassroots Organizations Transnational Social Movement Organizations Private Voluntary Organizations Self-help Organizations Non-State Actors (NSAs)

Freedom of Association

The Constitution of the Islamic Republic of Pakistan, 1973, guarantees the fundamental rights of citizens, including the right to form an Association. Every citizen has the right to form Associations or Unions, subject to reasonable restrictions imposed by law in the interest of morality or public order.

How Non-Governmental Organizations Are Registered

In Pakistan, NGOs can be registered under different structures depending on their operations:

Can NGOs Make Profits?

While Non-Governmental Organizations (NGOs) are not intended for profit generation, they can create a financial surplus. However, unlike companies that distribute profits as dividends, NGOs cannot distribute surplus to members or founders. Any surplus generated is typically reinvested into the organization’s activities.

Other Terms Used for Non-Governmental Organizations

NGOs are often referred to by various names, including:

Typical Forms of Non-Governmental Organizations

Advocacy NGOs:

These organizations primarily focus on advocacy or campaigning around specific causes. They do not engage in program implementation. For example, PETA advocates for the ethical treatment of animals but does not run animal shelters.

Consultancy / Research Organizations

These NGOs focus on social and developmental research, as well as consultancy.

Training / Capacity Building Organizations

In the NGO sector, "training" is often referred to as "capacity building." Some NGOs focus exclusively on building the capacity of other NGOs.

Networking Organizations

These NGOs provide vital networking opportunities for others in a specific field, such as the Association of Voluntary Agencies for Rural Development (AVARD), which networks NGOs working in rural development.

Mother NGOs

These NGOs function as both recipients and distributors of funds. Large NGOs, such as CRY and Concern India, receive funds and also disburse them. Their role is to identify projects, monitor, evaluate, and build the capacities of participating NGOs, rather than implementing projects themselves.

Grassroots Organizations

These NGOs work directly with communities, focusing on local development and empowerment.

City-Based Organizations

These NGOs limit their operations to specific cities.

National Organizations

These NGOs have a national presence, such as CRY, Pratham, and Concern India.

International Organizations

International NGOs are part of global networks, such as CARE India, which is integrated into Care's global operations. Like Mother NGOs, they receive and distribute grants.

Self-Help Groups

Though not typically classified as NGOs, self-help groups are often formed by community beneficiaries—typically women—who join together to achieve common goals.

Religious NGOs

A significant portion of NGO funding is directed toward religious-based organizations.

Some Prominent International Non-Governmental Organizations (NGOs)

These include various types of NGOs based on their focus, structure, or geographic scope:

NGOs can vary in their methods and activities. Some act primarily as lobbyists, advocating for policy changes, while others focus more on direct implementation of programs. For example, Oxfam, an NGO focused on poverty alleviation, provides vulnerable communities with the tools and knowledge needed to secure food and clean drinking water.

United Nations and Non-Governmental Organizations (NGOs)

The relationship between NGOs and United Nations (UN) agencies depends on their goals, mandates, and activities. Over 1,500 NGOs with strong information programs on issues of concern to the United Nations are associated with the UN's Department of Public Information (DPI). DPI helps these NGOs to access and share critical information, assisting the public in understanding the United Nations' global objectives.

This partnership is essential for creating a bridge between the United Nations and the global community, enabling grassroots advocacy, and promoting global awareness on important issues such as human rights, environmental sustainability, and peace.

World Association of Non-Governmental Organizations (WANGO)

The World Association of Non-Governmental Organizations (WANGO) is an international organization that unites NGOs worldwide to advance peace and global well-being. Founded in 2000, WANGO provides a platform for NGOs to connect, collaborate, share best practices, and multiply their contributions toward solving humanity's fundamental challenges. WANGO supports NGOs working toward universal peace, justice, and well-being for all people, offering mechanisms for communication, partnership, and advocacy. It is considered one of the leading global bodies for NGOs committed to these ideals.

Public Relations of Non-Governmental Organizations

Effective public relations (PR) are crucial for NGOs to meet their goals and gain support. Foundations and charities often employ sophisticated PR campaigns to raise funds and advocate for their causes. NGOs use standard lobbying techniques to influence government policies, raise awareness, and mobilize public support for social and political outcomes.

These PR efforts are particularly important for interest groups, as they can significantly impact political decisions and outcomes. NGOs frequently use media, social platforms, and public events to highlight their causes and engage supporters.

Management of Non-Governmental Organizations (NGOs)

Two management trends are particularly relevant to NGOs:

1. Diversity management is crucial in organizations working in multicultural environments. It focuses on managing cultural differences within the organization. For instance, Northern NGOs (those based in developed countries) often face challenges when working in Southern countries (developing countries). Personnel from wealthier countries may encounter completely different approaches and mindsets when conducting developmental activities in the target country. Successful diversity management requires sensitivity to these differences and the development of cross-cultural communication and understanding.

2. Participatory management is a key organizational style typical of NGOs. This approach emphasizes inclusivity in decision-making, where all members of the organization, from field workers to upper management, are seen as valuable sources of knowledge and skills. The idea behind this is that to develop and strengthen the organization, individuals must actively participate in the decision-making process. This is linked to the concept of a learning organization, where continuous learning, collaboration, and innovation are encouraged.

Legal Status of Non-Governmental Organizations (NGOs)

NGOs do not generally fall under international law like states or nations. However, there are some exceptions:

The International Committee of the Red Cross (ICRC): The ICRC, due to its work related to the Geneva Convention, holds a unique position and is subject to specific matters concerning international law.

European Convention on the Recognition of the Legal Personality of International Non-Governmental Organizations (1986): This convention sets a common legal framework for the establishment and operation of NGOs in Europe, providing a standardized approach to their legal recognition. It ensures that NGOs can operate and engage in activities across borders while maintaining their legal status.

Article 11 of the European Convention on Human Rights: Protects the right to freedom of association, a fundamental principle for NGOs, ensuring that individuals and groups can freely form and join NGOs for various causes.

Role of Non-Governmental Organizations (NGOs) in Global Affairs

The key ingredients that make or break an NGO/NPO, of course, are its programmes and projects. It covers the issues and themes that the NGO/NPO addresses, the target areas or communities that it works in, funding available and the activity's partners.

These are influenced by, among other things:

While it is critical that a new NGO/NPO ensure it is properly registered with the public authorities of the country, it is of even more importance to 'register' with its target community - in terms of ensuring acceptability, building trust, programme and project effectiveness, and bringing about real change.

Status of Non-Governmental Organizations in Pakistan

Non-Governmental Organizations also called as non profit organizations or charitable Institutions. Constitution of Pakistan, 1973 considers it the fundamental right of every citizen to form Associations. It is right and freedom of the citizens of Pakistan to form Associations. Non-Governmental Organizations can be registered under the Companies Ordinance, Trusts Act, Societies Registration Act and Income Tax exempts such Associations from any sort of tax.

Registration of Non-Governmental Organizations under The Companies Act, 2017

Procedure for registration of Non-Governmental Organizations under Sec. 42 of the Companies Act, 2017 and Companies (General Provisions and Forms) Rules, 1985 is given as under. A license will be issued to the NGO's under the Companies Act as it will be registered as a Company with limited liability without the word "Limited", "(Private) Limited", or "(Guarantee) Limited". These Companies applies or intends to use its profits for the promotion of its object and prohibit the payment of any dividend to its members.