Regulating Small and Medium Charities: Does It Improve Transparency and Accountability?

What is it about?

This paper considers the impact of a light- handed enforcement regime on small and medium charities’ reporting. It analyses the financial reporting practices of such charities registered with the New Zealand charities regulator. It predicts how the regulator’s activities might impact charities' future reporting practices .

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Why is it important?

Internationally, there has been a steady increase in the number of countries instigating charity regulation. Theory suggests that regulation reduces information asymmetry, protects (or encourages) a competitive market, and leads to better distribution of resources. But regulation comes with costs. This paper assesses what happens when a regulator tries to reduce costs and asks whether this 'light-handed approach' actually helps to achieve regulatory goals.

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