Accountability follows the money : the intermediary paradox and the structural limits of southern-led development

The international aid system continues to struggle to meet its localization targets, including the Grand Bargain’s commitment to channel 25% of humanitarian funding to local actors. One reason for this shortfall is that localization is often defined primarily by an organization’s geographic origin, thereby equating a Southern identity with structural independence. This thesis challenges that assumption through an empirical study of BRAC, the world’s largest Southern-origin nongovernmental organization (NGO). While BRAC Bangladesh has achieved a high degree of financial sovereignty, generating approximately 90% of its budget domestically, its East African operations remain heavily dependent on European development finance institutions. To understand why, I ask: Why does the BRAC model function as a grassroots catalyst in Bangladesh but operate as a structural intermediary in East Africa? To address this question, I develop the concept of the Intermediary Paradox, a condition in which a Southern-origin organization functions as a Northern-accountable intermediary in international contexts. Drawing on Resource Dependence Theory and Institutional Isomorphism, the study demonstrates how reliance on external sources of capital encourages Southern organizations to adopt Northern administrative and governance frameworks. This process contributes to ‘policy decoupling’ and reinforces the ‘Southern Comprador’ dynamic. Methodologically, the research combines fifteen semi-structured interviews with a forensic analysis of corporate annual reports, donor agreements, and organizational documents. The findings suggest that meaningful localization requires a fundamental shift from measuring geographic identity to fostering financial autonomy. Drawing on the experience of BRAC Bangladesh, I argue that the localization agenda is more likely to succeed when the international aid architecture prioritizes the development of self-sustaining financial models for local organizations. Building secure and independent revenue streams are a critical mechanism for enabling local actors to withstand geopolitical volatility and achieve long-term organizational sustainability.