In one of my earlier jobs, when I raised an objection to something wrong being done, one of my colleagues had adviced, “If you want to advance in your career, you need to keep your middle-class values aside.” I tried to do it too but in the end, decided that those values are the principles I live by and I don’t need to give it up for anyone. To the firm’s credit, I was never discriminated for being honest and I continued to keep my middle-class values.
When it came time for me to move on and I was looking for opportunities in the development sector, I met with Venkat Krishnan who founded GiveIndia. It just took one meeting for me to know that this organisation demands honesty and integrity not only from its own self but also from each one of the 200+ partners we work with. At that time, about 7 years back, GiveIndia was just beginning to visit each one of the organisations listed on the platform. I joined as a volunteer to do audits in the South and then eventually took over as the lead for the team which held the responsibility for due diligence for all partners.
Building a framework for the online donor
Our GiveAssured Norms are built keeping in mind the individual donor. Much like SEBI regulations that go beyond the statutory requirements of corporates, our norms have been built to ensure that NGOs are credible beyond the laws of the land. We understand that donors could come from any part of the world and could also give to any corner of the country. How does one then think about due diligence which will ensure that every last rupee of a donor sitting remotely is utilised and reported for.
To this let me add some complexities – NGOs come in different scale of operations, have varying operating models, use different accounting mechanisms and of course are spread across 23 states.
Our foundations of the norms are fairly straightforward – a donor should not give more than what the NGO needs, at any given point one should be able to track the monies channelled to the programs and there should be complete control over the implementation of the programs on the ground. Common sense, you would say. Building a framework keeping the diversity of operations across different causes is where the complexity starts.
Due Diligence at GiveIndia – glimpse into our operations
Each one of our partners has been visited and not just once. During each visit, we understand and evaluate their operations, processes and systems as well as their financials. By financials, it’s not just their audited financials but going through their books and each line item entered. We sit with the accountants and ask them to open up their book of accounts showing us how income and expenses are recorded, understanding the trend of costs and designing the programs based on actuals. Partners are free to ask for less than what they spend but not more.
We also check how the NGO implements, monitors and tracks the beneficiary and program level information. This is critical because the operating data tying back into the financials ensures credibility at an organisation level. In order to ensure that there is capacity for the organisation to absorb the funds, we also check for identification and allocation mechanisms for beneficiaries. For organisations that provide one time benefits like rations to elderly or school supplies to students, we additionally ask them to share a waiting list of people with names and addresses who will be provided with the benefit. The total ask for an organisation is capped based on the list shared.
While all of these are done before an organisation is signed up, we also need to ensure that the partners will continue to remain accountable once signed up. In order to do this, we plan for visits and independent verifications every year. Given our spread of 200+ partners across 23 states, this is a large logistical exercise undertaken around March of every year for the following year. Time, resources and monies are identified to complete these visits. We meet beneficiaries reported back to donors randomly and without prior intimation to the NGO. This allows us to confirm – without the NGO’s interference – that the last mile implementation is carried out.
There are some sensitive cases like HIV patients where we do our visits with prior intimation of 1-2 hours since there are social stigmas associated with such people. We try our best to not affect the lives of the people served in their own communities.
Continuous learning from the field operations
Over the years and after hundreds of visits and verifications, we have learnt and built into our systems and processes nuances which help us flag serious deviations which indicate a lack of accountability. Our simple black and white process is that if there are such deviations, we will not bring or retain the organisation on the platform.
There was one such organisation I had visited sometime back. While talking to the accountant, he showed me the registers in which they maintain their accounts. The organisation receives a government grant but the values in the register were not matching the sanction letters issued. On digging deeper, it turned out that they maintain two books of accounts – one for the government and one for other donors. We deem such visits as failures and do not bring them on board.
This is not to say that the process is watertight. GiveAssured is built to mitigate the risk of default to as great an extent as possible. As technology improves and policies allow for better traceability of monies, we continuously review and update our norms to bring greater accountability to the donors. Our default rate today is less than 1% and we will strive to make every effort to keep it within these limits.