Influence of online transparency on efficiency. Analysis of spanish NGDOs

Abstract

This study examines (a) whether nongovernmental development organizations (NGDOs) disseminate relevant information for their stakeholders through their web pages, information that after being reviewed and evaluated by external organizations such as the Spanish Coordinator of Development NGO or Lealtad Foundation, allowed these NGDOs to obtain a seal of transparency and (b) whether their level of transparency influences efficiency. To determine online transparency, web pages of seal-approved NGDOs were reviewed to assess the availability of relevant information. This paper uses data envelopment analysis to assess the efficiency using an input orientation. To determine the influence of online transparency on efficiency, an ordinary least squares regression was used. Results show that while increased transparency has a significant effect on efficiency, the level of information disclosure of NGDOs through their web pages has considerable room for improvement. Improved transparency leads to best practices and increased competition in obtaining financing and support from society. To improve transparency in the nonprofit sector, external organizations have created a series of seals to certify that an organization complies with the basic principles of transparency. In addition, new technologies make it easier for organizations to disseminate information quickly and economically. This article contributes to the literature regarding web use of NGDOs to disclose relevant information and analyzing the influence of online transparency on organizational efficiency.