There is much talk - rightly - about improving development effectiveness. In Bill Easterly's excellent book The White Man's Burden, he points out that many aid organizations have multiple objectives without accountability, lack a culture of measurement and focus on high visibility activities rather than those with greater pay-offs - e.g. AIDS treatment rather than prevention. An August 15 editorial in the Financial Times (full text available at CGD) made the same point about the need for more measurement of development effectiveness.
A lot of measurement in the aid business focuses at the country level. For example, the interesting rankings recently published by the Center for Global Development include a component on aid volume from each of 21 countries, which is then adjusted for quality factors, such whether it is tied. There are exhortations from many commentators, such as Jeffrey Sachs, for countries to increase the amount of aid given as a percentage of GDP.
But aid is delivered by organizations, rather than countries. The variety of organizations (public, private, NGOs) and of financing types (grants, soft loans, commercial financing) involved in the aid business means that it is somewhat simplistic to group everything under 'aid'. What about benchmarking organizations - to see how focused they are, how they measure themselves, etc.?
It is worth noting an effort that the microfinance organization CGAP carried out three years ago. They persuaded 17 bi/multilateral donor organizations to subject themselves to a peer review process, which led to several changes in those organizations in the way they support microfinance. One example: the European Commission, which had huge credit lines to microfinance, has moved out of funding credit lines into capacity building work. This is exactly the kind of lower visibility but higher impact work favored by Easterly. At the follow-up Better Aid for Access to Finance meeting in October, look for the heads of those 17 organizations to endorse a Quality of Aid in Microfinance Index - a move that should increase transparency in this field.
And the agencies on the ground, whether multilateral, bilateral or civil society, must be held accountable. That’s what’s been missing. That’s the job of the delegates to this conference: holding people and organizations accountable.