International Disability Alliance embarks on transformative reforms to strengthen leadership, governance & accountability

By IDA

 - September 3, 2024

Over the past 9 months The International Disability Alliance (IDA) has undertaken a series of significant reforms aimed at strengthening its leadership, financial management, governance and accountability. This process was in response to a comprehensive review commissioned by the Swedish International Development Cooperation Agency (Sida) in late 2023 and conducted by KPMG, which  identified major financial management and governance concerns within the International Disability Alliance (IDA). We are not able to publish the report itself, but some of the key findings were as follows:

  1. Financial irregularities: The review identified a significant amount of financial irregularities. These include unsupported bonuses, payments for untaken leave, and questionable costs for the Executive Director (ED), with a systematic lack of Board approved policies.
  2. Lack of transparency: The report indicates a persistent lack of transparency regarding HR decisions and financial practices. The IDA Board was reportedly kept in the dark on crucial financial decisions, raising concerns about fiduciary responsibility.
  3. Mismanagement and abuse of power: Multiple testimonies indicate instances of bullying, harassment, and misuse of authority. The report suggests that this behavior fostered a culture of fear and retaliation, particularly when financial decisions were challenged.
  4. Governance failures: The concentration of decision-making power among a few key individuals, combined with inadequate documentation and procedural breaches, has compromised the independence and effectiveness of the IDA Board. The report highlighted the risks of conflicts of interest and manipulation of meeting minutes to legitimize questionable decisions.

In response to the report IDA made significant changes in its leadership and governance, which IDA announced earlier in the year, and embarked on a wider process of reform. This included an independent internal control review conducted by Ernst & Young (EY),  to assess and guide the ongoing reform initiatives within IDA.

The EY review identified several critical areas where improvements were considered essential:

  1. Governance and organizational structure: The review highlighted governance risks, particularly due to overlapping roles within the Board and the General Assembly, and the absence of independent board members. Concerns were also raised about the lack of clear accountability and potential conflicts of interest.
  • IDA response: IDA has started enhanced board training and improved documentation processes. IDA is in the process of evaluating its governance framework and considering a range of potential changes to its Articles of Association, noting the suggestions in the EY report to separate decision-making and oversight functions, consider introducing independent board members, and enhance accountability through fixed term limits for board members.
  • Financial management: The review noted issues around financial stability, leading to operational challenges. High overhead costs and financial risks related to foreign exchange management were also identified.
    • Response: IDA has implemented cost-cutting measures, reduced overhead, and adjusted its budget strategy. The organization is actively working to diversify funding sources and restore donor confidence through transparent financial reporting and tighter budget controls.
  • Compensation and reasonable accommodation (RA) Policies: Concerns were raised regarding the absence of a formal remuneration committee and inadequate documentation of Reasonable Accommodation allowances and executive compensation decisions.
    • Response: IDA is formalizing its compensation procedures by establishing a remuneration committee with independent members. A Reasonable Accommodation policy was adopted on 27 May 2024 and will be implemented alongside a comprehensive HR policy update to ensure fair and transparent compensation practices.
  • Risk management and accountability: The absence of a functioning Senior Management Team and outdated risk management practices posed significant risks to IDA’s operations.
    • Response: IDA has a restructured organizational chart, with key senior management roles filled to match the IDA’s needs for the future and ensure strength and resilience in leadership and operations. The risk management framework is being entirely redesigned with Board oversight and independent guidance.
  • Procurement and anti-corruption measures: While procurement practices were generally found to be in place, the review emphasized the need for improvements in anti-corruption policies and reporting channels.
    • Response: IDA is tightening its anti-corruption measures by updating policies and introducing stricter controls and reporting mechanisms. Training and awareness initiatives will be rolled out to reinforce these practices across the organization.

    IDA remains committed to fostering a culture of transparency, inclusivity, and accountability as it navigates these reforms. These changes are critical to ensuring that IDA can continue its vital work advocating for the rights and inclusion of persons with disabilities globally. We appreciate the support and trust of our partners as we take these necessary steps to strengthen our organization. This process is ongoing – we are making good progress and it is important that we take the time needed to ensure that IDA meets the highest possible standards in all aspects of its mission, operation, and governance.

    The reforms are part of IDA’s broader “Fit for Purpose” program, which focuses on enhancing various operational areas through structured initiatives across Finance, Human Resources (HR), and Governance. This program is divided into key workstreams, each targeting specific outcomes crucial for the organization’s strategic alignment and operational efficiency.

    Fit for Purpose program

    The "Fit for Purpose" program launched by the International Disability Alliance (IDA) is a comprehensive initiative aimed at reforming and strengthening the organization’s governance, financial management, human resources, and overall operational efficiency. This program is a direct response to the findings from the KPMG report and an Ernst & Young (EY) internal control review, which highlighted critical areas requiring improvement.

    Key aspects of the program include:

    1. Governance reforms:

    • Establishment of key committees such as the Finance and Risk Committee and the Remuneration Committee.
    • Introduction of independent board members and implementation of fixed term limits for board members.
    • Enhanced training and structured listening exercises to better inform governance policies.

    2. Financial management:

    • Strengthening financial oversight with revised delegation of authority and updated financial policies.
    • Implementation of cost-cutting measures to reduce dependency on core funding and manage financial risks effectively.

    3.  Human resources:

    • Standardization of recruitment processes and a revised performance management system.
    • Implementation of new Reasonable Accommodation policies to ensure fair and transparent compensation practices.

    4.  Risk management and anti-corruption measures: Introduction of stricter anti-corruption controls and reporting mechanisms to reinforce integrity across the organization.

    5. Monitoring: The program is organized into a phased timeline with specific deliverables tracked through a detailed scorecard. This ensures that critical changes are introduced in a manageable and timely manner.

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