Why Compliance Goes to the Heart of What We Do at Good360 - Good360

Why Compliance Goes to the Heart of What We Do at Good360

At Good360, we think seriously about compliance. Very seriously.

Compliance is how we protect the brands of our generous corporate donors. It’s also how we safeguard the reputations of our nonprofit partners as well as our own. It’s in everyone’s interest to ensure that donations are properly collected, stored, and distributed. Badly behaving nonprofit partners can jeopardize the ecosystem for everyone.

Here’s how compliance fits into our unique nonprofit model: We help companies create effective philanthropic programs with donated goods, while supporting nonprofit organizations in their mission to improve their communities. Both of these overarching goals require us to maintain a high level of due diligence.

Our compliance efforts ensure that corporate donations are being properly handled and distributed to people who are truly in need. This gives donors the confidence to hand over the vetting process entirely to Good360 so that they can give to a large variety of nonprofit organizations without having to individually screen every group and monitor every donation.

We mitigate the risk that donated goods will end up being sold in secondary markets, given away to raise funds for the nonprofit, or otherwise used in a way that’s not intended by the corporate donor.

By donating their products to Good360, our donors are, by extension, trusting us to be good stewards of their brands and corporate reputations. So we are hyper vigilant about making sure that donated products are being used in a way that reflects well on the brand and the company.

Here are the steps that we take to ensure compliance:

Verify nonprofit status: We confirm that every nonprofit member is a 501(c)(3) organization that’s registered with the IRS. Nonprofit status must be verified both upon initial application and each year as part of our annual review process. In some cases, non-501(c)(3) organizations like schools are allowed to participate, provided that they adhere to additional restrictions and vetting.

Approve financials: We require applicants to submit financial documentation that is transparent and demonstrates how their programs are funded. Additionally, we check at least once a year to ensure the organization has submitted all necessary financial information to the IRS.

Review mission: Each applicant must provide an overview of their mission and how they achieve it. We use this information to ensure that the organization’s mission doesn’t conflict with either our policies, or the requirements or reputation of corporate donors.

Maintain strict guidelines: All of our nonprofit partners sign an agreement to adhere to our Product Use Guidelines. These guidelines require that donated products cannot be sold, traded, bartered, given to volunteers or staff as gifts, or used in conjunction with any fundraising event. This allows companies the option to investigate the applicability of the enhanced tax deduction that is sometimes available for product donations.

Pursue additional vetting: We conduct additional scrutiny as nonprofits increase their donation requests. If a request appears out of the ordinary or doesn’t seem to fit the organization’s mission, we will follow up with questions. We also conduct spot checks of documentation, and may make in-person visits to better understand how a nonprofit operates and how it’s using the products that it obtains through Good360.

Our compliance team also provides internal weekly reports on nonprofit activity, immediately investigates reported or suspected failures to comply with regulations, closely monitors eBay and other venues for possible donation resale, and takes other security measures as needed.

Under our product use guidelines, donations may not be:

  • Sold at thrift stores, flea markets, yard sales, on eBay or other internet sites
  • Bartered or otherwise transferred in exchange for money, property or services
  • Given to another nonprofit organization or other entity, unless provided written permission by Good360
  • Stored at a personal residence (including a home-based business)
  • Used in conjunction with any fundraising activities, silent auctions, or as prizes.
  • Given to nonprofit board of directors, officers, directors, employees, or volunteers for personal use, reimbursement or as a thank you for their services.
  • Given away in exchange for cash “donations”

Given our robust efforts to educate our nonprofit partners and enforce compliance, violations of our guidelines are rare. When they do occur, we take swift action to correct it. More often than not, the violation is inadvertent and it’s just a matter of making sure that the nonprofit has a better understanding of our guidelines.
We reserve the right to revoke the membership of any nonprofit who is unwilling or unable to follow these rules. We also offer custom compliance regulations for companies that have specific rules for using their donations.
Compliance is at the very heart of what we do at Good360. Our entire model relies on trust. Our corporate donors trust us to properly vet nonprofits and make sure that donations are being put to their best use. We trust our nonprofit partners to comply with our rules and use those donations to improve their local communities. It’s this trust that allows our ecosystem to prosper, benefiting people in need around the world through the delivery of hundreds of millions of donated goods each year.

Lenore Freeman
lenore@good360.org