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How donors use Due Diligence to identify corruption risks

Through targeted information collection, Due Diligence by development agencies can highlight corruption risks involving potential partners at an early stage. However, Due Diligence can prove difficult to implement, particularly among small NGOs unfamiliar with such requirements and formalities. Due Diligence must therefore balance the need for transparency with the reality on the ground.

Also available in French
25 September 2022
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How donors use Due Diligence to identify corruption risks

Main points

  • Reliable partners are essential to ensure that donor-supported projects are delivered in line with contractual commitments.
  • Due Diligence is a critical tool in any effort to combat corruption, as it allows donors to spot corruption risks involving a potential partner at the earliest possible stage.
  • Donors are bound by a best-efforts obligation and must therefore prove that they made every effort to obtain information about a potential partner in connection with a project. The availability of such information often depends on the knowledge of field staff and research conducted on the web or using dedicated systems.
  • The information collection stage may reveal red flags, which must be investigated and mitigated where necessary, eg more stringent anti-corruption clauses and audits during project delivery.
  • Due Diligence is particularly well-suited to partners with well-developed internal structures for sharing necessary information, but its reporting requirements can prove burdensome for local NGOs unaccustomed to such formalities. Donors may also be called on to inform and educate partners who see Due Diligence as an ‘abuse’ of transparency.
  • Due Diligence alone is not enough to prevent all corruption risks and must be incorporated into a broader framework.

Cite this publication

Autran, C.; Musso, S.; (2022) How donors use Due Diligence to identify corruption risks. Bergen: U4 Anti-Corruption Resource Centre, Chr. Michelsen Institute (U4 Issue 2022:11)

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Camille Autran
Sophie Musso


All views in this text are the author(s)’, and may differ from the U4 partner agencies’ policies.

This work is licenced under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International licence (CC BY-NC-ND 4.0)