Study: Majority of foundations need to improve transparency

Many foundations incorporated in Malaysia still need improvement on their transparency, frequency and credibility in communicating to the public, a Wiki Impact study has found.

According to the “Transparency Score of Malaysia’s Foundations” report for 2023, only 42 foundations out of the 1,710 surveyed achieved an A rating which is a score of 75 percent and above.

Out of the 42, only 12 earned a 100 percent score.

Among the foundations that received a perfect score were Yayasan Johor Corporation, Yayasan Khazanah, Yayasan Selangor and Yayasan Sime Darby.

Notable foundations that received a 75 percent score included MyKasih Foundation, Yayasan Dakwah Islamiah Malaysia (Yadim) and Yayasan Chow Kit.

“These foundations set a high standard for transparency and accountability, fostering trust with stakeholders and promoting community support through ethical practices and open communication.

“However, there remains significant room for improvement, as 65.03 percent of foundations analysed had insufficient information and received zero ratings,” the report read.

It also stated that nearly half of the foundations are located in the Klang Valley.

Of those surveyed, 65.61 percent have functioning websites and 39.30 percent maintain a social media presence.

Elaborating on the social media presence, only 27.13 percent of those surveyed made posts within the last three months.

“Only 2.11 percent released financial reports within the past five years, and 3.27 percent published impact reports in the same timeframe,” it added.

Transparency vital for donors, beneficiaries

Wiki Impact co-founder Terence Ooi stressed the need for foundations to embrace transparency by opening up about their operations and finances, among others.

“This will help assure their donors, beneficiaries and the public that they are accountable and committed to achieving their mission,” he said.

Ooi added that transparency not only prevents misuse of funds but also promotes ethical practices and ensures that non-profits fulfil their social responsibility.

“This strengthens their credibility and reputation, leading to increased support and a positive impact on the community.”

Ooi acknowledged that under the law, foundations are not required to disclose their annual, financial and impact reports; their board of directors; financial statements or amounts disbursed.

“However, this report seeks to recognise foundations that over-communicate and develop a shared public narrative.

“By doing so, we hope foundations will be more inclined to communicate the good work they do.”

Wiki Impact: 64pct of foundations score poorly on transparency

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