In order to really Bloom where we are
planted...besides having a personal relationship with God through His
son Jesus Christ, we would or should desire to be good stewards of all
He has given us. So before sending your check to a charity we should
have a good system for checking out how trustworthy stewardship wise
they also are.
Due Diligence Checklist
From The Eternity Portfolio: A practical guide to investing your money
for ultimate results.
Permission given to
use by author Alan Gotthardt
Met with him in Atlanta last year. 2013
Alan is updating his
book and there will be a revised edition in the fall of 2014!
Richard’s comments
are in RED.
This book specifically addresses how
to be a good steward and using God’s money wisely in a non profit Christian
ministry. However, these ideas can be applied to a secular investment also. Some
of the points do NOT necessarily apply to a business investment.
These principles apply to making
substantial investments in an organization, whether it is in the 100’s,
thousand’s or millions of dollars!
Again, the comments in RED are
solely Richard Dassow’s and NOT Alan Gotthardts.
When you’re considering whether to fund a specific
organization, there are many issues to consider. Here’s how to get started!
Review marketing/collateral
information such as the organization’s website, brochures, annual reports, and
presentations.
If possible, conducted a site
visit or vision trip to examine the operation firsthand.
For large gifts, meet with
leadership to better understand who they are and where the organization is
headed.
Have they approached
you for an investment or did you search them out? What are your goals and
motivations in making an investment in this organization?
Either through a face-to-face
meeting, telephone call, or collaterral information, try to get a sense for the
following:
1. ORGANIZATIONAL
ASSESSMENT
A. PURPOSE
1. What is the mission of the organization?
How clear is the mission statement?
Has there been mission drift?
What
specifically are the major problems/issues it is trying to address?
How clear is the mission statement? Has there been mission
drift?
A good resource
is Mission Drift
What is their Vision? It is different than their mission
statement!
Have you checked out their website?
Is their Vision, Mission and Strategy clearly stated on
their website?
Is it easy to find?
Do they have a Twitter and Facebook page?
Do they have a BLOG?
Check frequently to see what they are doing!
What specifically are the major problems/issues it is
trying to address?
Do they have a TWITTER page?
If so, follow them...see who they
are following.
What and how often do they tweet?
Do they have a blog?
How often do they post an
update?
Are their staff on Linkedin?
If so, connect
with them.
Are they using social media effectively?
2. What makes this organization unique?
Using principles of Good to Great, have they established a clear
need? Is the organization Passionate about what they are doing? Their mission.
Is the Ex. Director passionate? What are
their resources? How is Need, Passion and Resources combined for exponential
growth? Do they have the right people on the “bus”, the wrong people off the
“bus” and the right people in the right seats?
3. What is
the scope of the organization’s activities (local, regional, global,
country-specific)?
4. Are
there well-developed, high-level goals that have been established to mark
progress and give guidance to staff and donors?
How do they measure performance?
B. PEOPLE
1. How well do I know the leadership?
Are
they visionary? Capable of leading? Passionate about the mission? Do they value
relationships?
Is the Ex. Director
passionate? What are their resources?
How is Need, Passion and Resources combined for exponential growth? Do they
have the right people on the “bus”, the wrong people off the “bus” and the
right people in the right seats?
Is there a list of the staff and Board of Directors on
their website?
If you are on LINKEDIN, it is easy to check them out!
Even "connect" with them! If you do connect, does that help you
feel a part of their "team"? Is it important? Important for you?
2. What qualifications do those in leadership have?
3. Does the
board of directors represent a cross section of skills and qualifications
needed to successfully guide an organization of this type? Is there a job
description for the board members?
Is the board limited to policy making or do they do a lot of the
work? If so, is this good or bad?
Are
the board members investing financially in the ministry in a significant way? Do we know what
percentage of the total funds come from board members? How important do we
think that is?
4. Do the
staff members understand the organization’s missions and exhibit a genuine
concern for their area of ministry? Do they seem content and motivated? How do I know this?
Have I talked to them? Taken some of them to lunch? Is this important? Why?
C. PHILOSOPHY
1. How
receptive is the organization to feedback and questions?
Do
leaders appear transparent about problems, successes, and failures? Are staff interested in even talking to us? How important is
that to us? Obviously with a small donation it may not be important,,, but if
we have a significant financial investment to make it is or should be! Can we
make a designated or restricted gift…and work with them in the planning?
How about accountability? Can we structure the funds to be released
as progress is being made? Are they open to this? How involved to we wish to
become?
2. How are
donors treated? Is there a demonstrated accountability for the faithful use of
funds? How are volunteers recruited, trained, and utilized?
3. Does the
ministry seek to create leveraged results for the kingdom (i.e.,
multiplication)?
4. Do there
seem to be any “integrity fault lines” running through the different aspects of
the ministry? It’s fund-raising? Programs? Communications?
D. PROCESS
1. Is there a
written strategic plan for the ministry?
A 5 and 10 year plan?
2. As it carries out its mission, how is the
organization
perceived within the community?
3. What are
some of the new initiatives or activities the organization is undertaking? 5, 10, 15 year plan.
4. Where
does the financial support come from? A small group of major donors or a broad
audience? How willing are they in sharing this?
5. Are thee
audited financial statements?
6. Does the
organization appear to be staffed appropriately to execute the mission? Good to Great
concepts?
E. PERFORMANCE
1. How does
the organization measure its progress toward accomplishing the mission?
Are
there specific targets and objectives for the leadership as well as staff
within the organization?
2. Does the
organization communicate regularly and effectively with the donors? What is the
frequency?
3. Is the
organization accomplishing its mission?
11. `PROJECT ASSESSMENT
If we
are investing in a specific project.
A, ORGANIZAITONAL
FIT
1. Does
this particular project address one of
the core objectives of the ministry? In other words, is it part of a focused,
concentrated effort toward accomplishing the organization’s purpose, or does it
go outside of core competencies and mission?
2. Is this
project or activity already being conducted successfully by another
organization, and if so, are there reasons to duplicate?
3. How much of
the funding is already committed?
B. PROJECT REVIEW
1. Is this
a onetime investment for a project that will become a self-sustaining activity?
2. Other
than in the area of funding, where are the faith hurdles? In other words, where
must God supernaturally create the results for the project to be successful?
3. Do the
financial projections seem reasonable? Are they too optimistic? Do they leave
anything out? Is there a plan for contingencies?
4 Are
there specific, measurable objectives to be accomplished?
5. How will
progress be reported?
III. FINAL ASSESSMENT
1. Have I
(we) spent sufficient time seeking God’s will through prayer Bible study, and
wise counsel? Do I (we) have any wrong motives or conflicts of interest that
should prevent this investment?
2. Assuming
all indications are positive, are there any nagging questions or concerns that
should be resolved?
3. Whether
or not this appears to be a great opportunity, do I (we) feel specifically led
to be involved at this time?
Have I
(we) asked the 4 questions from Ben Carson’s book: TAKE THE RISK; Learning to Identify, Choose, and
Live with Acceptable Risk.
From The Eternity Portfolio: A practical guide to investing your money
for ultimate results.
Additional Resources:
Take the Risk: Learning to
Identify, Choose and Live with Acceptable Risk.
Money, Possessions, and
Eternity, Randy Alcorn.
