Beyond the Checklist:

Why Due Diligence Drives Real Impact

Redefining Due Diligence 

When you think about due diligence, what comes to mind? Perhaps endless document reviews, financial audits, or compliance checklists—the standard procedures investors use to verify claims before making decisions. But IAP’s due diligence goes beyond ticking boxes or validating spreadsheets. It’s about discovering authentic impact, building business capacity, and establishing partnerships that transform both enterprises and the communities they serve.  

Where Impact Gets Real: Beyond the Paperwork 

Understanding true inclusiveness requires hearing directly from People Living in Poverty (PLIP) about how businesses integrate them into their operations. Direct engagement uncovers impact that no application could adequately capture. When our teams speak with customers, suppliers, and community members, we discover the real transformation happening on the ground—or sometimes, the gaps between promises and reality. 

In Ethiopia, a farmer shared how one company’s service transformed his family’s life:

“Thanks to this service, my kids are now regularly attending classes. Before, my kids and my wife had to spend hours shelling maize, which took a lot of time and significantly disrupted their school schedule. Now, with the threshing service, they have more time for their education and other important activities.” 

Another woman described new income generating opportunities: “This company gave us a home-based business that fits perfectly into our daily lives, allowing us to make use of castor leaves that have been abundant but unused for decades.” 

These conversations validate whether businesses truly integrate PLIP into their value chains—the core principle that defines authentic inclusive enterprises. Without these direct voices, we cannot verify if companies are genuinely inclusive or simply claiming to be. 

Turning Scrutiny into Strength 

Our deeper conversations with business leaders uncover a welcome side effect: the due diligence process created space for companies to identify opportunities for strengthening their operational systems. The rigorous evaluation provided a framework for businesses to assess and improve their own governance and procedural foundations. “The IAP process enabled us to identify our weaknesses and strengths, and how we can better improve as a firm in governance, systems and procedures,” reflected one company CEO from Zambia. “The exposure was excellent for our growth and for us to be investor ready.” 

Another business director from Uganda explained:

“The due diligence process helped us put systems in place that we used to ignore since our company was still young, like having proper staff contribution systems and other elements that seemed less relevant at our current stage of growth.” 

Even applicants that did not pass the due diligence found unexpected value in the process. A founder from Zambian noted: “We were very weak in governance, systems, and procedures based on the due diligence parameters. Interacting with the IAP team was eye opening, and we promise to work on weaknesses to be able to participate in future challenge funds.” 

Building Trust Through Transparency 

Due diligence deepens the relationship with businesses, moving beyond initial applications to establish meaningful partnerships throughout the IAP programme and beyond. By understanding specific needs in governance, financial management, and operational procedures during assessment, we design targeted technical assistance from the programme’s start rather than generic support that may miss the mark. 

This approach transforms the traditional funder-business relationship. Rather than a one-way evaluation process, due diligence becomes an open dialogue where companies share their challenges and aspirations, while the IAP team gains genuine understanding of each enterprise’s context. When funding decisions are made, both sides already know what to expect from the partnership.  

Ensuring Readiness, Enabling Impact 

Due diligence does more than select the right partners: it ensures IAP doesn’t simply fund businesses—we partner with enterprises genuinely ready to transform lives whilst having the capacity to manage that transformation responsibly. By understanding both impact potential and technical assistance needs from the outset, we build the foundation for sustainable growth that benefits businesses, communities, and the broader inclusive business ecosystem. 

Through meaningful assessment and developmental support, due diligence becomes the foundation for lasting change among the 4 billion people at the base of the economic pyramid.