DETERMINANTS OF FINANCIAL SUSTAINABILITY OF PAKISTANI NGOs

Abstract

Purpose Non-governmental Organizations (NGOs) play a valuable and unique role in the development and growth ofthe developed and developing states. The NGOs sector is majorly dependent on donations, which raises a big question on their strategic and financial sustainability. To understand the status of financial sustainability of NGOs in Pakistan the following research has been conducted. The purpose ofthis study was to find out the factors affecting the financial sustainability ofLocal NGOs in Pakistan. Methodology & Design The quantitative method was used in this study for the data collection and research is based on secondary data which was collected from the financial reports of the local NGOs. The research design that is adopted in this study is explanatory research that is used to define the cause-and-effect correlation between the two variables. This research makes the use of panel data procedures in the dataset. The sample size of this research encompasses on 13 local NGOs in Pakistan. Findings The findings ofthe study are that local NGOs in Pakistan are not financially sustainable and depended on donor funding. The study shows that income diversification and donor relationship management are statistically significant with each other expect own income generation. Limitations There are some limitations ofthe study is that there are also many more sub factors through which we can measure financial sustainability oflocal NGOs more precisely such as consider number ofincome sources to measure more exactly income diversification, strategic alliance generation, and number ofreturn donors and donors funded projects in donor in own income relationship management. Recommendations in Pakistan should take crucial steps to diversify The study recommended that local NGOs their income sources, expand different resources of own income generation and are being capable of under the priorities of donor’s and regulate their foundation procedures, systems,and activities in such a way that enable them to attract more benefactors and become sustainable