A non-governmental organization (NGO) is a non-profit, citizen-based group that functions independently of government. NGOs are organized on local, national, and international levels to serve economic, social welfare, and civic purposes. Despite their independence from the government, many NGOs receive significant funding from government entities.
Key Takeaways
- A non-governmental organization (NGO) is a non-profit, citizen-based group that functions independently of government.
- NGOs are organized on local, national, and international levels to serve economic, social welfare, and civic purposes.
- Despite their independence from the government, many NGOs receive funding from local, state, and federal governments through grants, contracts, and cooperative agreements.
Watch Now: What Is an NGO?
Understanding NGOs and Government Funding
NGOs are private organizations, managed by private individuals and operated independently of government.
As of 2021, there are about 1.5 million NGOs in operation in the United States, representing a wide variety of causes. Some NGOs focus on developmental projects, such as clean water while others promote awareness of specific causes, such as gender equality.
Many NGOs receive funding from local, state, and federal government entities through grants. A grant is a financial award given to an organization with a specific purpose. Grants help provide funding for medical research, economic development, educational advances, and various projects that provide public services. Grants are essentially gifts that do not need to be repaid.
Other forms of funding for NGOs include:
- Annual membership dues or fees
- Donations from individuals
- Donations from charitable foundations, which are funded either by public donations or private donors, such as a corporation, an individual, or family
- Revenue or income from the sale of goods and services
- Contracts and cooperative agreements with governments
Special Considerations
Government funding of NGOs may provoke controversy when public officials and/or constituents differ about the NGO’s goals or the purposes of the funding. Some NGOs prefer not to be identified or associated with the government and eschew funding from any government or national or international governmental organization.
For example, the environmental NGO Greenpeace does not take any funding from the government or corporations. Greenpeace is prohibited from being involved in politics, by virtue of being registered as a charity.
Examples of NGOs and Government Funding
Examples of NGOs that currently receive government funding, or that have received government funding in the past, include:
Doctors Without Borders
Doctors Without Borders is an NGO that provides medical assistance and access to medicines to those in need throughout the globe, which includes fighting malnutrition, HIV/AIDS, Malaria, and many other medical issues.
The vast majority of the revenue is raised through donations from individuals, corporations, and foundations. The organization receives some government funding internationally but limits that funding to less than 20% of the total amount of funds raised. Doctors Without Borders has not received any funding from the U.S. government since 2002.
American Association of Retired Persons (AARP)
The American Association of Retired Persons (AARP) is an organization that helps people age fifty and older by providing education and information. Some of the issues that AARP focuses on include financial education, caregiving for seniors, and fraud protection.
AARP receives some grant funding from the federal government through the AARP Foundation, which helps to fight poverty for senior citizens. Otherwise, the organization receives the vast majority of its funding through membership dues, donations, and advertising revenue from its publications. AARP also earns royalty income by allowing third-party firms, such as financial institutions to use the AARP brand name.
World Wildlife Fund (WWF)
The World Wildlife Fund’s mission is to conserve nature and promote the diversity of life on Earth. The issues being addressed include creating renewable energy, creating sustainable food systems for people, conservation of forests, and ensuring that there’s an adequate amount of freshwater. In 2021, 28% of the WWF’s funding came from individuals, 29% from foundations, 3% from corporations, while only 9% came from government grants.