Due diligence is a procedure that requires a thorough review of possible contributions or investments. Due diligence includes going beyond the surface to gather evidence of organization claims like contract copies, performance tests and market research data. The goal is to identify and reduce the risks that Deal Flow Management could adversely affect the business.
Recent scandals have damaged several charitable organizations’ reputations highlighting the need for thorough due diligence. Media have criticized universities in US and UK which named buildings after people who were found guilty of crimes. They also lost substantial contributions to philanthropy.
But, critics say that a too strict approach to due diligence can deter donors from giving generously. This argument argues for a balance approach that focuses on identifying reputational risks but doesn’t impose unreasonable large limits on a donor’s privacy rights.
It’s a due diligence or fundraising procedure it’s vital to have a central secure and secure platform that can organize and share information with various stakeholders. This will enable you to quickly locate the documents you require and speed up the time needed to find important agreements. Virtual Data Rooms (VDR) are an extremely popular tool for organizing and collecting due diligence information as they offer the ability to host index and share confidential documents with multiple users in a central location.
In addition to VDR and due diligence, a common process of fundraising and due diligence should be able incorporate public data from the internet in order to support the identification and assessment of reputational as well as operation risks. This vast collection of publicly accessible data covers everything from news articles to corporate blogs, databases, and grey literature. A central, efficient and flexible data collection process that integrates this information available to the public can enhance the efficiency of your efforts and help you avoid costly errors.