Following the "Raising Children" campaign, a non-profit expert discusses solutions to close the loopholes.

Although non-profit and charitable organizations have been present in Vietnam for over 30 years, many people still do not fully understand the operating mechanisms and governance standards of this sector, making it difficult for them to identify unusual signs from the outset.

One of the activities supporting disadvantaged children by Saigon Children's Charity - Photo: Saigon Children's Charity

Amidst debates about transparency and governance surrounding numerous "childcare" projects and charitable activities, Tuoi Tre Online has gathered opinions from experts and those with years of experience in the non-profit sector on this issue.

Transparency goes hand in hand with auditing.

From the perspective of an international charity operating in Vietnam for over 30 years, Damien Roberts, CEO of Saigon Children's Charity, identifies ensuring transparency as one of the pillars for building the organization's credibility and sustainability.

According to Roberts, independent auditing is the most important tool for proof. “Auditing acts as a 'third party' with expertise and credibility, confirming that the figures published by the organization are accurate and reflect the true state of operations,” he said.

This also provides a basis for organizations to be more accountable to the public, especially as public opinion increasingly demands higher standards of responsibility and transparency.

Saigonchildren undergoes annual independent audits, with KPMG Vietnam as the auditing firm. Simultaneously, the organization publishes full financial reports and annual reports, updating the results of each program to its partners and sponsors. For specific projects, if requested by the sponsor, Saigonchildren is willing to collaborate on separate audits to increase assurance and verification.

In addition to auditing, a transparent system can be further strengthened by internal controls and independent oversight mechanisms, ensuring that all expenditures and activities are verifiable and traceable. All fundraising and program implementation processes are within the current legal framework for non-profit organizations in Vietnam.

Besides transparency, the CEO of saigonchildren also emphasized the essential principle of "respect" when social organizations work and are accountable to all stakeholders.

With children as its beneficiaries, saigonchildren strictly adheres to principles of child protection, privacy, identity, and personal image, requiring all staff, volunteers, and partners to sign a commitment to protect children when participating in the program.

With partners and sponsors, the organization maintains transparency and close collaboration throughout each stage of the project, proactively providing timely updates on results, reports, and any changes related to funding commitments.

"And the authorities, we respect and strictly adhere to current legal regulations, and proactively coordinate closely during the implementation process to ensure legality and compliance with local policies," Robert added.

Personnel costs are necessary, but they must be transparent.

Operating costs, including staff salaries, are also a concern for many people regarding charities or NGOs , starting with the notion that "charity doesn't need salaries" or "why use fundraising money to pay staff salaries?".

Regarding this matter, Robert explained that in the case of saigonchildren, the organization will have a team of volunteers – a group of personnel that is indispensable in social activities.

However, he also emphasized that for an organization to operate effectively and ensure transparency, it needs a team of full-time, specialized personnel. These are key positions related to decision-making, finance, reporting, operations, and oversight…

With years of experience working at several domestic and international non-governmental organizations, Mr. Nguyen Dinh Duc, lecturer at the Faculty of Economic Law, University of Economics and Law (Vietnam National University Ho Chi Minh City), said that paying benefits, including salaries, to employees of non-profit organizations is a normal practice in Vietnam, as non-governmental organizations have been operating in the country for over 30 years.

Accordingly, the design of policies for workers and volunteers in these organizations falls under two main groups: sponsors and management. Depending on the revenue generation mechanism, such as receiving stable funding from the government or private funds, or relying on community contributions, each organization will have its own way of developing policies.

According to Mr. Duc, operating costs could be 10-20% deducted from contributions. "But we can't use the excuse of fearing others might be upset by 10-20% to cut corners on transparency in how the money is used. The important thing is to explain how this 10-20% is being used," Mr. Duc stated.

"In short, any allocation of funds for personnel in an activity, project, or organization must be communicated to and agreed upon by the donors. The unauthorized use of funds that have been allocated for a specific purpose to pay for personnel is not common practice in organizations or non-profit groups," Mr. Duc affirmed.

How do you manage interest income?

In the event that the fund generates profit during its management, saigonchildren states that all profits/losses are transparently accounted for in the annual public financial reports submitted to the regulatory authorities in the UK and Vietnam. These amounts mainly come from bank deposit interest or exchange rate differences, and are listed as a revenue item of the organization.

Mr. Roberts emphasized that the profits cannot be used arbitrarily but must adhere to the registered operational objectives. Depending on the case, the profits will be allocated to activities consistent with the mission of supporting children, or retained as a reserve to increase financial viability for future programs.

Due to the rapid disbursement of funds, the amount of interest accrued annually by the organization is not large, accounting for only 1% to less than 2% of total revenue.

With sponsors, saigonchildren states that it always maintains transparent communication regarding disbursement progress so that they can adjust their funding plans accordingly. For large grants, the organization will discuss directly with sponsors how to handle any resulting profits or losses, ensuring consistency and trust throughout the entire fund management process.

NGHI VU

Source: https://tuoitre.vn/sau-nuoi-em-chuyen-gia-to-chuc-phi-loi-nhuan-noi-ve-giai-phap-bit-lo-hong-20251212000407517.htm