Principles and Standards of INGO Fair Reward
Purpose: There is increasing focus within the international aid and development sector on the importance of fair reward, and demand for a common set of reward-related principles and standards for organisations working in the sector. Reward is particularly challenging for international aid and development organisations due to the legacy of how the work has historically been structured, the breadth of locations in which the work is located (often conflict or crisis), and the changing nature of those engaging in the work now being drawn from global, rather than higher-income, contexts. This evolution requires a reconsideration of how INGO reward is structured.
The focus on fair reward aligns with the United Nations’ Sustainable Development Goals, specifically SDG8 – decent work and economic growth, which calls for “equal pay for work of equal value”, SDG10 – reduced inequality, which calls for “equal opportunity and reduced inequalities of outcome”, and SDG17 – partnerships for the goals, which calls for enhanced cooperation between stakeholders to help meet the goals. It also aligns with the Core Humanitarian Standard on Quality and Accountability, in particularly Standard 8 – “staff are supported to do their job effectively, and are treated fairly and equitably” and Standard 3 – “humanitarian response strengthens local capacities and avoids negative effects”.
These Principles and Standards of INGO Fair Reward are designed in order to help organisations develop a shared understanding of what fair reward means for the sector. This document outlines a series of standards as minimum requirements which are underpinned by 5 core principles. The standards and principles have been collaboratively developed by a working group of 25 INGOs. It is intended that agreeing to these principles and standards demonstrates an organisational commitment to fair reward. They are aspirational in nature and do not reflect the assessment of whether existing reward structures are fair. Organisations that agree to commit to the principles and standards will include a public commitment on their website and will participate in an annual peer evaluation process.
Throughout the document we define reward as the total reward package an employee receives, including base pay, allowances and benefits, as well as access to non-financial rewards such as career development and leadership opportunities. We recognize the core goal of reward is to attract, retain and motivate the right talent at the right point in time, and to do so in ways that enable the organisation to achieve its core aims in a financially sustainable way.
Stakeholders to this document include (and are not limited to) beneficiaries, donors, funders, employees, partners, suppliers, and unions.
Principle 1: Ethical Reward – Reward policy is fully aligned with the organisation’s mission and values
Standard 1a: reward policies are free from bias and discrimination, and decisions made irrespective of personal characteristics;
Standard 1b: reward policies and practices should not undermine or distort the local market;
Standard 1c: the INGO sector should be leading the way in good reward practice, and as such encourages and promotes the use of the Principles and Standards of Fair INGO Reward amongst all stakeholders.
Principle 2: Transparency – reward is offered in a way that is transparent, evidence-based and easy to understand
Standard 2a: reward policy is present;
Standard 2b: reward policies and practices are available for all staff to access;
Standard 2c: process behind, and components of, reward policies and practices are clearly explained with a commitment to being applied consistently.
Principle 3: Equity – reward given to different employees is fair, consistent and justifiable
Standard 3a: all jobs are appropriately graded to reflect required technical knowledge, skills and experience;
Standard 3b: reward policies are designed to enable necessary variation depending on local contextual factors, such as in hardship locations, fragile states or absence of necessary skills;
Standard 3c: there is a commitment to policies being applied systematically.
Principle 4: Sustainability – a) cost of reward reflects stewardship of donor funds, and as such is justifiable to donors while ensuring long-term organisational financial viability; b) reward levels ensure sufficient wages for all employees in all countries
Standard 4a: reliable salary benchmarking data are used when setting reward;
Standard 4b: reward policies and external factors are reviewed periodically to ensure fairness is maintained.
Principle 5: Compliance and Risk – all reward policies and practices meet local and international legal and regulatory requirements, while also respecting broader organisational social responsibility
Standard 5a: compliance with legal context in all countries of operation and responsiveness to any changes to that context;
Standard 5b: commitment to understanding tax obligations and providing mechanisms for workforce compliance.