Why good governance is so important

Part of the process for all funders when assessing grant applications is to undertake a series of due diligence checks. These checks determine the health, strength and competence of an organisation and show evidence of their ability to use the funding being applied for in a safe, effective and efficient manner.

During the COVID pandemic, we along with other funders relaxed our rules with regard to due diligence checks to get the funding out into local communities as quickly as possible so groups could respond to the need they were seeing. It is now time to tighten up again and we want to be more open and transparent about this process.

We want the groups that will be applying to us in the coming months and years to understand the checks we will be making, particularly at application stage, so that they can ensure they meet our requirements. This is especially pertinent for governance checks as this is the start of your funding journey with us.

We have recognised that we can offer more support to the groups we work with, particularly on our processes and expectations. Earlier this year, we conducted a survey that asked groups to identify the areas of grantmaking they needed the most support with. Advice on monitoring and evaluating a project came out top, closely followed by governance support then writing and planning a good application.

To cover these topics and more, we have created a Grants Toolkit to support groups and will be building this toolkit, with your input, over time.

The Governance section of this toolkit offers advice and guidance and includes our Minimum Expected Standards document.

Minimum Expected Standards is our guide for undertaking due diligence checks on the supporting documentation that we request with an application. The guidance is based on legal requirements, particularly for groups registered with a regulatory body, but also on best practise.

We’ve introduced these standards for a number of reasons:

• We want your group to have the best chance of success, not just with us but with other funders who will also be undertaking similar checks.
• We’ve noticed standards have slipped post pandemic which is understandable given the focus on service delivery.
• Maintaining documentation is a process of continual development so keeping your documents up to date and in line with current legislation shows funders that your organisation is robust and active.
• Funders will be unlikely to move on to the exciting part of your application – reading about your organisation, your aspirations and the opportunities that you and your community have identified – if your organisational governance is poor.
• Undertaking due diligence checks is part of the risk assessment for funders. We want our fund to support your organisation to make a difference to the lives of those you work with. If an organisation has a strong structure and effective policies and procedures in place, it is more likely to deliver a high quality, safe and meaningful service with community at its heart.

We believe that honest and constructive feedback will help organisations unsuccessful in securing grants to improve and strengthen.

Our Minimum Standards are not intended to trip you up or provide another hoop to jump through. They aim to help groups to identify areas of development and offer guidance on where to go for support. This will give future applications an improved chance of success, not just with Community Foundation Wales, but also with funders across the sector.

You can find our Grants Toolkit here.

We’d love to hear from you and gather any thoughts, positive or negative, on the Minimum Standards document and our Grants Toolkit in general.

We welcome your feedback so please let us know if there is anything missing that you would find particularly helpful.

Feel free to contact me via LinkedIn or send an email to andrea@communityfoundationwales.org.uk