In our last article, we explained what the term due diligence means. Before awarding you a grant or even considering you for one, most donors will do their due diligence to find out if your NGO is trustworthy and healthy and thus a good partner.
But if you know one of them is coming up, how can you prepare for it? In this article, we give you some tips so your NGO is ready.
Most donors that give only small grants will do a very simple due diligence. They will definitely check your online presence though. If you have a website, be sure that it is up to date and explains your work clearly. Double check if every project or work area that you mention in your proposal is also clearly mentioned on the website. If you reference an old and successful project in your application, but this project has not made it yet to the website, the donor might grow suspicious. Make sure your website looks professional and inviting to inspire confidence in your organization.
The same goes for every other online presence, particularly on social media. It does not look good if your Facebook profile has not been updated in months or if the last pictures are from the office party instead of your project work. If you have social media profiles, make sure that they send the message you want them to send in the moment that a potential donor will probably check them.
It is always a good idea to ask an outsider to check your online presence from time to time. Sometimes you are too close to it to see the entire picture and things that are missing or could be represented in a better way might be more obvious to an outsider.
Many donors will ask to see your registration documents, your tax exemption or even your tax returns. Make sure at the time of your application you have all these documents available and in order. If a potential donor requests certificates and they are outdated or not available, you will definitely leave a bad impression. Double check before you send a proposal out, so you are sure that everything is looking good.
Depending on the size of the grant you apply for, due diligence can be exhaustive. Some donors want to have detailed access to financial and operational information about your NGO to be able to judge your stability. Be ready to grant access and have everything in order. Particularly your financial information needs to be transparent and logical to not raise any red flags with the donor. Be ready to grant access to all your documentation and to the people that deal with them to install trust in the donor.
If you keep all these tips in mind, your NGO should be ready for a donor to do their due diligence. In the end, transparency helps both sides to build a stable and good relationship with each other.
Eva is based in Germany and has worked for nearly a decade with NGOs on the grassroots level in Nepal in the field of capacity development and promotion of sustainable agricultural practices. Before that, she worked in South America and Europe with different organizations. She holds a Ph.D. in geography and her field of research was sustainability and inclusion in development projects.
