When most academics raise the question of accountability “to whom,” they note its complexity due to the different stakeholders with which NGOs must deal. Accountability relationships are problematic because NGOs are expected to be accountable to multiple actors: upwards to funders or donors, downwards to beneficiaries, internally to themselves and their missions, and horizontally to other NGOs (Christensen & Ebrahim, 2006; Edwards & Hulme, 1996; Ebrahim, 2003a; 2005; Kearns, 1996; Lindenberg & Bryant, 2001; Najam, 1996).

Upward accountability to donors primarily evaluates the use of funds. Downward accountability to beneficiaries responds to the groups that receive the NGO’s services and assesses how they are being delivered (Ebrahim, 2005, 2003a, b; Edwards & Hulme, 1996; Lloyd, 2005; Najam, 1996; Urquía-Grande et al., 2017; 2022). There is also internal accountability to the NGO staff, who answer for the organization’s responsibility and its mission. Finally, NGOs’ horizontal accountability to other NGOs enables comparison among them (Ebrahim, 2003a; Ebrahim, 2010; Edwards & Hulme, 1996; Sowa et al., 2004). Thus, NGO accountability needs may vary depending on the stakeholder being considered (Brown & Dillard, 2015; Kingston et al., 2019).

NGOs tend to prioritize their upward accountability to demonstrate results to donors to justify their donations. However, this pressure on short-term results makes it difficult to implement long-term projects that might be more relevant to their optimal performance (Christensen & Ebrahim, 2006; Ebrahim, 2003a, 2009; Edwards & Hulme, 1996; Kilby, 2006; van Zyl & Claeyé, 2019; Wallace et al., 2006). In addition, some studies in the literature emphasize that the pressure to present adequate results to donors may also reduce the NGO's transparency in reporting failures and undesired results, and thus its ability to learn and be more effective (Agyemang et al., 2009; Ebrahim, 2003b; O'Dwyer & Unerman, 2007; Schmitz et al., 2012; van Zyl & Claeyé, 2019).

Regarding for what the NGO is responsible for, although financial issues primarily define accountability in business firms, NGO accountability focuses more on whether they make proper use of their financial resources, that is, how they perform their social work and what are the results they achieve in trying to accomplish those goals (Ebrahim, 2003b; Ebrahim et al., 2014; Fremont-Smith, 2004; Hansmann, 1996; Moore, 2000; Saxton et al., 2014).

Distinguishing between the dimensions of financial accountability and performance accountability is thus critical in NGO, as many scholars have identified (Avina, 1993; Brinkerhoff’s, 2001; Brody, 2002; Connolly & Hyndman, 2004; Cutt & Murray, 2000; Ebrahim 2003a; Edwards & Hulme, 1996; Frumkin, 2006; Goodin, 2003; McDonnell & Rutherford, 2018; Najam, 1996; O’Dwyer & Unerman, 2007; Saxton & Guo, 2011). Financial accountability proves whether the NGO is accountable for the money it raises from various sources, whereas performance accountability evaluates the results and impact of the NGO with respect to its goals and mission-driven objectives.

Although these two categories are well recognized in the literature, multiple definitions and differences in the concepts have made it difficult to consolidate a homogeneous concept of accountability for NGOs. All show consensus on the distinction between accountability for "finance" and accountability for "performance". Academics also consider performance accountability as more important for NGOs, since NGOs should be accountable to stakeholders not only for financial sustainability but also, and more importantly, for the social impact of their activities as defined in their mission. The reality may be different, however.

Accountability is the basic principle of responsible practice for any institution, public, private or NGO (Edwards & Fowler, 2002), but who is asking the NGO to be accountable. The NGO’s capability to satisfy the requirements of all its stakeholders depends on its ability to formulate accountability systems that account, both internally and externally, for dimensions of economic and social commitment. Due to the complexity of this accountability, NGOs need more complex mechanisms that include not only formal procedures but other more flexible processes that bring them closer to their stakeholders (Costa et al., 2011; Ebrahim, 2003a; Unerman & O’Dwyer, 2006). However, almost all of the accountability mechanisms used by NGOs are adaptations of those used by for-profit companies, which on the one hand, have the resources to complete reports, certifications, or codes of conduct, and on the other hand, financial results are usually enough to validate their performance.

We defined our research criteria as NPO OR non-profit OR charity* OR NGO OR non-for-profit OR Nonprofit” to collect all nomenclatures used for these types of organization in the literature. We added the Boolean operator “AND” in the search string to associate these terms with “Accountability*,” so as to include all concepts related to “accountability” that could be queried. We added the “donor” or “stakeholder” terms with the Boolean operator AND to narrow the investigation to accountability to stakeholders. In a second query we changed the “donor” or “stakeholder” to “mechanism” to identify the articles related to accountability “how”. We applied all those terms to the "abstract" field to search for all English-language articles that treat the concept of NGO accountability to donors. The main research areas were related to Public Administration, Business Finance, Social Issues, Management, Economics and Social Work. The total search resulted in 226 articles of which 177 are related to accountability to stakeholders/donors and 49 to accountability mechanism.

We then examined all titles and abstracts of the articles and excluded those that were not related to accountability issues or were very specific to locations or organizations, that could limit or represent a bias in the identification of the research trends. After excluding those studies our sample for the systematic review included 134 articles. The studies date from 1995 to 2022. Out of the 134 articles identified, 37 used the term non-governmental organization and/or NGO, while the remaining articles used variations of the term nonprofit, including nonprofit organization (NPO), not-for-profit organization (NFP), charity, religious organizations and service club. Figure 1 details the selection and exclusion processes.

In order to refine the articles that address the topic of our study and to identify the key issues from the NGO donor accountability perspective and possible research gaps, we performed a co-ocurrence and bibliographic coupling bibliometric analysis using VOSviewer software version 1.6.16 (0) (van Eck & Waltman, 2010).

Keyword co-occurrence analysis shows the relationship between keywords that appear together in a recurring way in some parts of queried articles and in different articles. It detects how often those terms (keywords) are included in the sample and how close the two terms are, that is, the time they appear together in different articles. Bibliographic coupling examines the number of references that two articles have in common. If two articles cite a third, then the first two are bibliographically coupled. This means that, the more references they share, the more similar their research topic (Arroyo et al., 2022).

The interactions formed by the application of these techniques are presented in network maps. Graphically, each node represents a term (keyword or article, depending on the analysis) that belongs to a cluster. Larger nodes correspond to more significant terms than smaller nodes, and the closer one node is to another, the more related they are (even if the nodes are not in the same cluster). Finally, the lines show the links between nodes (Van Eck & Waltman, 2010).

For the keywords co-ocurrence analysis we considered the keywords, provided by the authors, that occurred at least twice. Initially, there were a total of 381 keywords, of which 63 occurred at least twice. They were grouped in nine defined clusters all related to each other. Figure 2 shows the visualization map.

In Cluster 1 (red), the terms financial reporting, compliance, disclosure, effectiveness and transparency appear together with the keywords charity, non-governmental organization, nonprofit organization and not-for-profit. The studies in this group address issues related to accountability “for what” topic by discussing the relevance of financial reporting and how the organizations disclosure them (Cordery et al., 2019; Keating & Frumkin, 2003). Articles in this cluster that include the term non-governmental also address the organization's transparency and reputation that could be established for its accountability (Gent et al., 2015).

Cluster 2 (green) groups accounting, beneficiary accountability, case study, education, regulation, stakeholders, along with ngo, non-profit and public sector. Studies in this group are associated with accountability “to whom” question considering the different needs in relation to accountability information of the different stakeholders (Cordery & Baskerville, 2011; Yesudhas, 2019) and how they respond to the accurate information provided by the organization (Feng et al., 2016) without distinction among NGO or NPO.

Cluster 3 (dark blue) includes development aid, downward accountability, felt accountability, felt responsibility, microenterprise, upward accountability, ngos and ngos accountability. Again, the main topic of this group is related to accountability “to whom” subject. In this cluster most of the articles refer to NGOs and discuss the problem regarding accountability to different stakeholders and the effects that prioritizing accountability to donors (upward accountability) produce on the organization (Dewi et al., 2019; Murtaza, 2012) suggesting solutions to balance the accountability to donors and beneficiaries (downward accountability) (Chu & Luke, 2022; O'Dwyer & Boomsma, 2015).

Cluster 4 (yellow) gathers, donors, financial accountability, perceptions, voluntary disclosure, nonprofit organizations and charities. Articles in this cluster discuss the issues of “to whom” the nonprofit should be accountable for. Different perspectives about the greater accountability to donors instead of beneficiaries in NGOs are discussed and recommendations are suggested to balance both (AbouAssi & Trent, 2016; Connolly & Hyndman, 2017; Goncharenko, 2021; Kingston et al., 2019; Uddin & Belal, 2019).

Cluster 5 (purple) presents evaluation, internal development, organizational learning, outcome measurement, performance measurement, reporting and nonprofits. This group of articles is related to the topic of accountability “how” and addresses the need to establish mechanisms and frameworks, especially those related to performance measurement that could help to organizations to strengthen the relationship with their beneficiaries (Benjamin, 2008; Dar, 2014).

Cluster 6 (blue) includes accountability, governance, mission, performance, stakeholder salience religious organization and nonprofit. In this group, the discussion is about how organizations are accountable and the mechanisms they use for presenting their results (Ebrahim, 2005) and the effect on donors in the case of NGOs (Goncharenko; 2019; Yasmin & Ghafram, 2019).

In Cluster 7 (orange) the terms instrumental accountability, legitimacy, self-regulation, transnational communities, nonprofit accountability, and nonprofit governance. The articles in this cluster address the need to establish mechanisms that help organizations to be accountable. Those who deal with NGOs raise the option of self-regulation as an accountability mechanism for NGOs (Burger, 2012; Deloffre, 2016) or even join voluntary accountability groups (Tremblay-Boier et al., 2016) to overcome the standard accountability mechanism.

Cluster 8 (brown) gather the terms civil society, fundraising, non-profit organization, social media, and stakeholder theory. This group addresses issues less related to the other clusters. The topics deliberated in this cluster refer to NGOs and its fundraising (Zhou, 2019) and the influence and relationship of NGOs with civil society (Harsh et al., 2010; Oppong, 2018).

Cluster 9 (pink) includes the terms social accounting, social capital, trust, non-governmental and organizations. In this group, the importance of accountability and the way in which it is presented is related to the trust that the donor places in the organization, named as charity, NGO or NPO (Guo et al., 2022; Hyndman & McConville, 2018; Yates et al., 2021).

We selected bibliographic coupling by document with at least five shared references to guarantee the research topic is similar. Of a total of 134 articles, 114 of them shared at least 5 references and formed 6 cluster linked to each other. Figure 3 presents the visualization map generated.

The results found in bibliographic coupling are in line with the research avenues found in keyword analysis. Although in the case of keywords there is a greater number of clusters, since some articles are in more than one cluster due to they refer several keywords.

Articles in Cluster 1 (red) conceptualize about the challenge nonprofit accountability represents in relation to accountability “for what” and accountability to “whom” The articles explore accountability through social analysis of relationships between individuals enacted through social interaction, and options to improve the issues accountability represents (Ebrahim et al., 2014; Hielscher et al., 2017; Yates et al., 2021).

In cluster 2 (green) the authors address the relevance of NGO disclosures to NGO stakeholders. The studies analyze the effectiveness of NGO accountability and transparency disclosures—via social media, websites, or watchdog organizations—in attracting donations. Interestingly, different studies have found that donors often do not consult to watchdog ratings or NGO disclosures when making their donation decisions. Instead, they appear to assess the effectiveness and trustworthiness of NGOs through other means, such as familiarity, word of mouth, or the NGO's visibility in the community. The challenge thus seems to be to provide the information that users want, such as organizational effectiveness, not only use of funds the NGO received (Connolly & Hyndman, 2013; Gálvez-Rodriguez et al., 2016).

In Cluster 3 (dark blue) we found articles that study the effect of NGO performance and accountability on the NGO itself. Those articles discuss the negative effect of pressure on NGO performance measurement and accountability information on the NGO. The results seem to show that, the greater the pressure, the worse the NGO’s performance (Goncharenko, 2021; O’Dwyer & Boomsma, 2015). Analyzing the effect of volunteers on downward accountability, Dewi et al. (2019) observe that having volunteers can improve beneficiary accounting by reducing the distance between the NGO and its beneficiaries.

Most of the articles in Cluster 4 (yellow) examines accountability processes and mechanisms making distinction and clarifying the relationship between the accountability processes and the relationship with the different stakeholders. The topic of NGOs continuing to prioritize upwards accountability, despite NGOs’ intentions to change that trend is also revised (Benjamin, 2008; Murtaza, 2012; Yesudhas, 2019).

Analysis of the articles in each cluster shows that Cluster 5 (purple) gathers articles that primarily address regulation of NGOs’ financial disclosures as a means of improving accountability to donors. These articles discuss the importance of accreditation and regulatory compliance and the influence of NGOs’ organization and executives on that process. Heightened scrutiny of accountability, transparency, and ethical behavior are now part of the everyday language of NGO stakeholders. This scrutiny also enables NGOs to differentiate themselves from other NGOs and to strengthen their bonds with donors (Edwards & Hulme, 1996; Ospina et al., 2002; Schmitz et al., 2012).

Cluster 6 investigate the complexity of and the interaction between the accountability needs of the stakeholders in the context of nonprofit performance (Wellens & Jegers, 2014), the limited knowledge of the relative importance of different stakeholder and whether the information disclosed by the nonprofit meets their needs. Connolly & Hyndman (2017) also investigate the interaction between the accountability needs of donors and beneficiaries in the context of NGO performance. Despite the claims in the literature, they found that, upward accountability may facilitate the NGO’s downward accountability process.

Donors, through their monetary donations or volunteer work, provide the resources that NGOs have to do their work. This dependence on donor contributions influences the prioritization of NGOs' accountability towards them. Bias toward upward accountability affects not only the beneficiaries and their communities but also other types of relationships targeted by the NGO (Schmitz et al., 2012). Besides, the effect for that prioritization sometimes makes it difficult for NGOs to execute projects. Focusing on short-term issues to demonstrate results to donors makes it problematic to implement long-term projects that might be more relevant to their performance (Ebrahim, 2009; Christensen & Ebrahim, 2006; Ebrahim, 2003a; Edwards & Hulme, 1996; Kilby, 2006; Van Zyl & Claeyé, 2019; Wallace et al., 2006).

The accountability to donors implies that NGOs need to publish information for donors that could limit the possibility of making other types of reports that are also necessary to know the NGO. Such practice may introduce a certain bias by restraining the scope of failures and therefore concealing the need to be more effective (Agyemang et al., 2009; Burger & Owens, 2010; Ebrahim, 2003b; O’Dwyer & Unerman, 2007; Schmitz et al., 2012). Reports preparation for donors also incurs in a higher administration cost for the NGOs, which in turn impacts negatively on donors’ demand for low overhead cost (Calabrese, 2010; Cnaan et al., 2011; Dietz et al., 2017; Feng et al., 2016; Ito & Slatten, 2020).

In view of the criticism of prioritizing upward accountability, some authors have presented alternatives to improve NGOs’ accountability process. Hielscher et al. (2017) propose that accountability must be founded on a comprehensive governance approach that analyzes all relationships with NGO stakeholders. These authors show that improving accountability in NGOs requires identifying the underlying competence dilemma in the NGO and focusing on collective self-regulation as a solution. Agyemang et al. (2009), Edwards and Fowler (2002), Kilby (2006), O’Dwyer & Unerman (2010), and van Zyl and Claeyé (2019) propose that beneficiaries should participate in the NGO’s accountability process by establishing a dialogue with them to assess how their needs are being met. Ebrahim (2003a,b; 2005), Christensen and Ebrahim (2006), and Costa et al. (2011) propose that nonprofits’ accountability should be based on the organization’s mission. Such change could avoid the problems NGOs face in responding to upward accountability to donors and downward accountability to beneficiaries. It would save NGOs from the danger of making accountability relationships with donors primary, since NGOs should be firm in their mission and thus also in their commitment to beneficiaries. Schmitz et al. (2012) proposed that solution is to share more relevant information with the beneficiaries and be more transparent in the communications, without clearly specifying how this could be done.

In the more recent literature, other authors, seek to eliminate the negative bias in donor accountability. Connolly & Hyndman (2017) investigate the interaction between the accountability needs of donors and beneficiaries in the context of NGO performance. Despite the claims in the literature, they find that donors, while seen as prominent stakeholders in NGOs, cede power to beneficiaries. Accountability to donors, therefore, does not necessarily preclude accountability to beneficiaries. On the contrary, upward accountability may facilitate the NGO’s downward accountability process. Similarly, O'Dwyer & Unerman (2007) show that donors also want to help NGOs improve accountability to beneficiaries. Dewi et al. (2019) observe that having volunteers can improve beneficiary accountability by reducing the distance between the NGO and its beneficiaries. Options such a felt responsibility to beneficiaries, in line with the organization’s mission, has also been identified as a mediator to balance both upward and downward accountability (Chu & Luke, 2022; O'Dwyer & Boomsma, 2015). Although these ideas are not common in the literature, they certainly have interesting implications for overcoming the limitations posed by bottom-up responsibility in NGOs

The earliest studies on this subject distinguish between short-term functional accountability, which accounts for the use of resources and immediate impact; and strategic accountability, which accounts for the impact of one NGO’s actions on other organizations and on the environment in general (Avina, 1993; Edwards & Hulme, 1996; Najam, 1996). Ebrahim (2003a) and O’Dwyer & Unerman (2007) follow this differentiation between functional and strategic accountability.

In a following study, Cutt and Murray (2000) defined procedural accountability, as a basic level common to all organizations, that includes the organization’s accomplishment of processes and procedures. The second level, consequential accountability, is explicitly related to achievement of organizational objectives according to their mission and operational methods. Based on these definitions, the authors establish that the NGO’s financial statements simply describe the various sources of funding the organization uses and provide information at the basic procedural level but do not determine the impact of executing NGOs’ programs (consequential accountability).

Continuing with the differentiation of two types of accountabilities, Saxton and Guo (2011) follow Brinkerhoff’s (2001), define accountability for finance as related to financial resources and accountability for performance which seeks to demonstrate performance, considering the NGO’s mission objectives. Accountability for performance involves demonstrating the NGO’s progress toward its goals and holding it accountable for the agreed-upon performance objectives and achievement of its mission.

Subsequent studies (Brody, 2002; Connolly & Hyndman, 2004; Frumkin, 2006; Goodin, 2003; McDonnell & Rutherford, 2018) persist in identify two types of accountabilities with the same differentiation between financial and performance accountability, denominated fiduciary accountability and performance accountability. Fiduciary accountability depends on the credit and trust that organizations deserve. Performance accountability has two sub-dimensions: process responsibility and substantive responsibility. The first sub-dimension refers to the NGO’s organization and management and the second to how the results of NGOs’ activities relate to their objectives.

In summary, although there is not a single classification, there is a consensus among the scholars that accountability “for what?” must distinguish between financial and performance results. Performance accountability is more relevant for NGOs since they should be accountable to donors and other stakeholders not only for financial sustainability but for the social impact of their activities as defined in their mission. However, although the most significant aspect of NGOs is how they accomplish their social mission, still financial accountability gets extra attention (Cordery et al., 2019; Keating & Frumkin, 2003).

Nevertheless, there are scholars who discuss the negative effect of pressure on NGO performance measurement and accountability information on the NGO. The results seem to show that, the greater the pressure, the worse the NGO’s performance. Ebrahim (2003a) disagrees with the assumption that the more rigorous the performance measurement, the better. The time required to measure performance means that other activities must be stopped or delayed, so this accountability represents an opportunity cost for the NGO. He thus proposes focusing on measures that are really relevant to the NGO, not measures that are countable. Such practice would focus the NGO’s work more closely on its beneficiaries, whose interest is not in being informed but in being served. O’Dwyer and Boomsma (2015) found that accountability was fading as government accountability requirements became stricter and more demanding. In addition, since literature has proven that donors do not rely on standard accountability information in their donation decision (Connolly & Hyndman, 2013; Gálvez-Rodriguez et al., 2016; McDougle & Handy; 2014; Saxton et al., 2012; Szper & Prakash, 2011), it seems counterintuitive to spend money on reports that donors are not going to use.

Finally, there is a less studied area in the NGOs accountability which is that it can help to build donors’ trust. Through the information that NGO disclosures, NGO can reinforce its legitimacy and transparency, standing out from other organizations and thus attract a greater number of donors (Gent et al., 2015; Goncharenko, 2019; Guo et al. 2022; Hyndman & McConville, 2018; Yates et al., 2021).

Ebrahim (2003a, 2005), defines accountability tools as instruments or techniques nonprofits use to show accountability. Tools include financial reports, disclosures, and performance evaluations, repeated over time, and aimed primarily at donors. Other tools that nonprofits use are management practices that strengthen an organization’s focus on its mission, that ensure that the institution's core values, and mission are upheld and respond to donor concerns. He also points out that nonprofits tend to focus more on short-term accountability, in part because of the push for accountability upwards, rather than for the more strategic, long-term processes that form the core of nonprofits activity.

In the case of NGO, accountability mechanisms are used primarily to show donors that financial resources were used as intended and that the NGO's actions achieved the expected impact (Ebrahim, 2003a; Najam, 1996; O'Dwyer & Unerman, 2007). Upward accountability makes NGOs more active in reporting, auditing, and monitoring activities to demonstrate their performance (Christensen & Ebrahim, 2006; van Zyl & Claeyé, 2019). No such clear mechanisms exist, however, to evaluate NGO performance.

To overcome this constraint some authors propose “self-regulation” as an accountability process that NGOs perform by developing standard codes of behavior and performance. Self-regulation aims, on the one hand, to improve the NGO’s image despite a public scandal and, on the other, to protect the NGO from particularly restrictive regulations (Schweitz, 2001). Although government oversight (especially through reporting) may be appropriate for building public trust, self-regulation serves as a mechanism thus improves accountability processes to donors, beneficiaries, and the NGO itself (Burger, 2012; Ebrahim, 2003a; Hielscher et al., 2017; Stoezer et al., 2021). Costa and Andreaus (2014) propose a conceptual model that provides a mechanism to assess both functional and strategic accountability, its effectiveness and efficiency, and to drive behavior through feedback and readjustment. Another proposal is to join accountability clubs that incorporate mechanisms that monitor compliance and help maintain the necessary standards for the organization (Gugerty, 2009; Tremblay-Boire et al., 2016; Yates et al., 2021). Murtaza (2012) and Yesudhas (2019) stress that, despite NGOs’ aspirations for more meaningful and integrated accountability, they prioritize accountability to boards and donors and provide weak accountability to communities. To change this practice, the authors recommend developing an accountability mechanism and practicing transparency to empower beneficiaries. They do not, however, specify clearly how this change could be achieved.

Yet it is not only the limitations implied by the current mechanisms for adequate accountability in NGOs. The reporting process and communication require, a higher number of NGO staff personal to perform the process and thus higher overhead costs. This requisite creates a contradiction, due to the need to report low administrative expenses, as some NGOs lack a decent infrastructure to prepare the reports. Small NGOs are barely able to function as organizations, let alone serve their beneficiaries (Calabrese, 2010; Cnaan et al., 2011; Dar, 2014; Ito & Slatten, 2020; Liket & Maas, 2015).