Giving Wisely: Best Practices for Due Diligence in Philanthropy

Pamela Hawley, founder of UniversalGiving, explains why meaningful philanthropy takes more than good intentions. She highlights the importance of strategic giving, nonprofit vetting, donor trust, and responsible due diligence—encouraging donors to evaluate a nonprofit’s finances, leadership, compliance, overhead, and impact. By emphasizing the importance of independent third-party vetting, Hawley shows how donors can give with greater confidence, clarity, and accountability.

When Pamela Hawley was a child visiting Mexico with her family, she encountered a scene that would alter the course of her life.

She had been walking through a vibrant marketplace filled with music, food, and colorful Mexican wares when her curiosity led her down a nearby cul-de-sac. What she saw there stood in stark contrast to the beauty and energy of the marketplace: children who were poor, dirty, begging, and physically maimed.

The experience left a permanent impression.

“I remember the word ‘unacceptable’ coming across my mind in capital letters,” Hawley recalled. “It was something I could never turn away from again.”

That moment became the beginning of a lifelong calling. Hawley went on to volunteer locally in East Palo Alto, helping distribute food, translating Spanish, and serving in communities close to home. Over time, her service expanded internationally, taking her to places such as El Salvador, Cambodia, Uganda, and Mexico, where she worked alongside communities facing natural disasters, health crises, violence, poverty, and instability.

Eventually, those experiences led her to found UniversalGiving, a Tech for Good nonprofit designed to connect people with vetted opportunities to give and volunteer around the world. But Hawley’s mission has never been simply to encourage generosity. Her deeper work is helping people give wisely.

The Difference Between Generosity and Strategic Giving

Many people want to do good. They feel moved by a cause, a story, a personal experience, or a need in their community. Hawley believes that impulse matters. Giving should come from the heart.

But heart alone is not always enough.

Hawley compares charitable giving to investing. When people make financial investments, they often study the company, review its leadership, examine its performance, and consider whether it aligns with their goals. She believes donors should bring a similar level of care to philanthropy.

“You can absolutely give and volunteer from the heart,” Hawley explained. “But why not also get to know the nonprofit? Why not study their materials? Why not spend time with them?”

For Hawley, strategic giving does not mean removing emotion from philanthropy. Instead, it means combining compassion with wisdom. Donors should ask what moves them personally, but they should also ask whether the organization they support is credible, transparent, effective, and aligned with their values.

This is especially important when giving internationally, where donors may not be able to visit the nonprofit easily or understand the local context firsthand.

Asking Better Questions Before Giving

Hawley encourages donors to begin with the heart, but not end there.

A person may feel called to give because of a family experience, a personal loss, a community concern, or a moment of awakening similar to the one Hawley experienced in Mexico. But once that desire to give emerges, donors should begin asking deeper questions.

Who leads the organization?
How long has the leadership been in place?
What is the organization’s story?
What is its culture?
How does it operate day to day?
How does it treat the people it serves?

Hawley emphasized that donors should look beyond the executive director or CEO. They should try to understand the broader team, the organization’s ethos, and the people actually doing the work.

“People are what make organizations run,” she said.

That principle applies whether the nonprofit is local or international. Even when donors cannot physically visit, Hawley noted that technology makes it possible to meet leaders, attend virtual conversations, review public materials, and better understand the people behind the mission.

When Generosity Misses the Mark

One of Hawley’s most important messages is that generosity can be sincere and still be ineffective.

Good intentions do not automatically produce good outcomes. A donor may care deeply about a cause but still give in a way that is poorly researched, misaligned, or unsustainable.

To avoid this, Hawley recommends that individuals and families identify their top giving criteria. These criteria become a kind of “true north” for philanthropic decisions.

For some donors, the priority may be financial stewardship. For others, it may be measurable impact, such as meals served, students educated, or families housed. For others, it may be the transformation of one life or one community.

UniversalGiving helps families and philanthropic partners clarify those priorities through its philanthropy services. Hawley explained that families often need help understanding not only the parents’ giving goals, but also the interests and values of the next generation.

In this way, giving becomes more than a transaction. It becomes a reflection of values, stewardship, and legacy.

The Common Mistakes Donors Make

One of the most common mistakes Hawley sees is assuming that a large or well-known nonprofit is automatically the best choice.

A strong brand does not always guarantee strong stewardship.

Hawley encourages donors to look more closely at expenses, leadership, impact, and transparency. She noted that some nonprofits may spend money in ways donors would not expect or support. That does not always mean an organization is doing something wrong, but donors should be willing to ask questions.

If information is not readily available, donors should ask for it.

A strong nonprofit should be able to explain how it uses funds, what impact it creates, and how it responds to challenges. And if it cannot, that may be an opportunity for the organization to improve its own systems and communication.

Hawley also encourages donors, when possible, to speak with people who have directly benefited from the nonprofit’s work. If a home was built, how did that experience go? If a child received access to education, what changed? If a community received support, what was the result?

Numbers matter, but stories matter too.

Why Vetting Matters in International Giving

UniversalGiving is especially known for its emphasis on vetting. Pamela Hawley created the UniversalGiving Quality Model after years of working on the ground in communities around the world, where she saw firsthand that donors needed trust and security before they could confidently give.

The model began with six stages, including areas such as finances, anti-terrorism, and mission alignment. Today, it has expanded into a 24-stage process used to evaluate nonprofits with greater rigor. That vetting process is designed to provide what Hawley calls a “stamp of endorsement” — an independent review that helps donors, companies, wealth management firms, and foundations understand whether an organization meets appropriate standards.

For donors giving internationally, Hawley believes third-party vetting is essential. “If you are not able to go around the block and visit the nonprofit in person, then you need more than basic due diligence,” she said. “You need an actual official stamp of vetting.”

UniversalGiving works with individuals, corporations, wealth management firms, high-net-worth donors, billionaires, and foundations that want to evaluate nonprofits before giving. The organization offers different levels of vetting, including Classic, Premium, and Ultimate, and can customize the process depending on the donor’s needs.

As part of that process, UniversalGiving prepares rigorous written reports, often ranging from eight to 20 pages depending on the nonprofit and the scope of the review. Each report includes agreed-upon vetting categories, written analysis, recommendations, ratings, and a summary of strengths, areas for improvement, and red flags.

Hawley explained that the reports are organized to make concerns clear. Standard findings appear in regular text. Areas needing improvement are marked in yellow. Serious warning signs are marked in red. The final recommendation may advise whether a donor should move forward or avoid supporting a particular organization.

Donors are not required to follow UniversalGiving’s recommendation, but they gain the benefit of a third-party perspective backed by years of experience. That experience matters. Hawley said UniversalGiving has seen issues ranging from fraud and terrorism concerns to poor management, weak compliance, and organizational culture problems.

Sometimes the issue is not malicious intent. It may simply be poor training, weak financial systems, or inadequate governance. But even when there is no bad intent, those weaknesses can still affect whether donor funds are used responsibly. For Hawley, vetting is not about discouraging generosity; it is about helping generosity move forward with greater confidence, clarity, and trust.

What Donors Should Look For

When evaluating a nonprofit, Pamela Hawley recommends that donors look closely at several core areas: finances, leadership, compliance, risk, overhead, and impact. These questions are especially important in global giving, where donors may not be able to visit the organization in person or see its work firsthand.

First, donors should understand how the organization uses its money. How does the nonprofit spend its funds? What percentage goes to programs, operations, fundraising, or overhead? Is the donor comfortable with the organization’s financial priorities? Hawley noted that some donors become concerned when overhead exceeds 20%, while others prefer to see it closer to 10% to 12%. At the same time, she cautions that overhead should not be judged too rigidly, because some nonprofits are more people-intensive than others. The key is not simply whether overhead is high or low, but whether the spending is reasonable, transparent, and aligned with the organization’s mission.

Second, donors should evaluate leadership and culture. Who is leading the organization? What kind of team surrounds that leader? Does the mission appear to be reflected not only by the CEO or executive director, but also throughout the staff and board? For Hawley, leadership is not just about one person at the top. A trustworthy nonprofit should have a culture of responsibility, clarity, and alignment across the organization.

Third, donors should consider compliance and risk. UniversalGiving vets both staff and board members, not just executives, because risks can move in and out of an organization through leadership connections, board relationships, weak oversight, or poor internal controls. Sometimes the problem is not intentional wrongdoing; it may be a lack of compliance, weak financial management, or insufficient training. But even when there is no bad intent, those issues can still affect whether an organization is able to operate responsibly.

Finally, donors should look carefully at impact. A lack of clear impact can be a significant red flag. Hawley believes impact should be communicated in two ways: through numbers and through stories. Donors should look for measurable evidence, such as how many people were served, how many meals were provided, or how many families were helped. But they should also look for real human stories that show how lives were affected.

Why Volunteering Changes the Donor

For Hawley, one of the best ways to become a wiser giver is to volunteer.

Volunteering allows donors to see an organization in motion. It reveals what annual reports cannot: how the nonprofit responds to pressure, how it treats people, how it solves problems, and how it adapts when something unexpected happens.

Hawley offered a simple example. Suppose a nonprofit is serving food and 50 extra people suddenly arrive. Does the organization panic? Does it turn people away? Does it go to the freezer, cook more food, buy more supplies, or create a solution?

“You want to work with operators who can respond in an unknown moment,” she said.

That kind of insight does not come from a brochure. It comes from being on the ground.

UniversalGiving brings volunteering and giving together because Hawley believes the two reinforce one another. People who volunteer often become more connected, more informed, and more committed donors.

She shared the story of a mother and daughter who volunteered through UniversalGiving at a medical clinic in Haiti. The experience, the mother later told Hawley, changed their relationship.

That is part of Hawley’s broader vision. Giving is not only about helping others. It also changes the giver.

Building a World Where Giving Is Part of Everyday Life

At the heart of UniversalGiving is a simple but expansive vision: to create a world where giving and volunteering are a natural part of everyday life.

For Hawley, philanthropy is not reserved for institutions, foundations, or the ultra-wealthy. It is something individuals, families, companies, and communities can practice with intention.

But meaningful giving requires more than generosity. It requires discernment. It requires humility. It requires a willingness to listen, learn, evaluate, and engage.

Hawley’s message is especially relevant in a world where donors increasingly want impact, but may not know how to assess it. Her work through UniversalGiving offers a bridge between the heart of philanthropy and the discipline of responsible stewardship.

Good intentions may open the door to giving. But strategic giving, careful vetting, and personal engagement help ensure that generosity truly makes a difference.

 

Pamela Hawley Interview Transcript

Alan Olsen:
Welcome to American Dreams. My guest today is Pamela Hawley. Pamela, welcome to today’s show.

Pamela Hawley:
Hello, Alan. Thank you so much for having me.

Alan Olsen:
Pamela, I’d love to briefly revisit your background for listeners who may be new to your work. Could you share the journey that led you to found UniversalGiving and devote your career to helping people give and volunteer around the world?

Pamela Hawley:
Thank you so much. I started UniversalGiving after a very important experience in Mexico with my family.

We were on vacation, having a great time, and we were in a marketplace filled with music, beautiful food, and all of these wonderful wares from Mexico. I was always a very curious child, so I started walking down the street. I walked down a cul-de-sac and saw a very different picture: children who were maimed, without legs, dirty, poor, and begging.

It was so different from what I had just experienced. I was shocked. I remember the word “unacceptable” coming across my mind in capital letters. It was something I could never turn away from again.

After that experience, I started volunteering in the backyard of East Palo Alto, handing out food, translating Spanish, and learning Spanish. That eventually led to serving all over the world through volunteer trips. Over time, that inspired me to use technology for good. UniversalGiving is a Tech for Good nonprofit, and we match people with the right volunteer opportunities and the right opportunities to donate.

Alan Olsen:
I love your model with UniversalGiving and how you give people the opportunity to be involved in philanthropy.

Many people want to do good, but they do not always know how to do it wisely. In your experience, what is the difference between generosity and strategic giving?

Pamela Hawley:
That’s a really good point, Alan.

It always amazes me that when people make investments, they take time to review those investments. They look at the company, examine it carefully, and strategically decide whether they are going to invest.

I believe the same thing should happen with giving and volunteering.

You can absolutely give and volunteer from the heart, and that is an important component. But why not also get to know the nonprofit? Why not study their materials? Why not spend time with them?

You can do that before or after you give, because sometimes giving is of the heart and happens in the moment. Maybe a friend asks you to give, or maybe there is a benefit. But the more we get to know our nonprofits, understand them, and figure out how we can help them through both time and money, the more effective we can be.

That is what UniversalGiving is about. We want to make sure people are really thinking about how they are giving and volunteering, both with their money and their time.

Alan Olsen:
When someone feels moved to give, what are the first questions they should ask before choosing a cause or an organization?

Pamela Hawley:
I do think it is important to follow your heart. A lot of people have very good instincts about where they might want to give.

It might be that a family member was affected by something. Maybe you saw something on the street, as I did, and it became a life calling. So, yes, follow your heart.

But one of the questions you really want to ask is about leadership. You want to look at the leadership of the organization. How long have they been there? How committed are they? What is their story?

As a philanthropist, you have a story within you about why you want to give and why you feel moved to give. Maybe something happened to your child. Maybe there is a need in your community that you want to fulfill.

But you also want to get to know the leadership of the organization, and not just the executive director. You want to understand how the organization works. Get to know some of the staff. Attend some of their events, not only the big benefits, but also the day-to-day activities.

Get to know the people. People are what make organizations run.

If the organization is international, you can still do that. We are fortunate to have tools like Zoom, and you can also visit them on the ground. You can also read what their leaders have written online. But I would say the most important thing is getting to know the people, because people are what run the organizations.

Alan Olsen:
I love that. It really is all about people.

One of the movements we are seeing in leadership is helping people go from good intentions to meaningful and measurable impact. How do you help individuals measure the effectiveness of their giving?

Pamela Hawley:
UniversalGiving created the first Quality Model, which is trademarked. It is the UniversalGiving Quality Model, and it vets nonprofits through a 24-stage process.

When I first came back from volunteering on the ground after the earthquake in El Salvador, I had also worked with victims of the Pol Pot regime in Cambodia, many of whom had lost limbs because of buried landmines that had not been uncovered. I had worked in HIV in Uganda and domestic violence in Mexico.

When I was on the ground, Alan, I kept thinking, “How am I going to get people to want to give unless they feel trust and security?”

When I came back, I thought about how to create a stamp of endorsement, a quality model that shows a nonprofit has been verified.

When we started, the model had only six stages. We looked at finances, anti-terrorism, mission alignment, and other key areas. That became our first stamp — our first vetted logo that we placed on each nonprofit we vetted.

Now we have 24 stages.

Today, when we work with donors, we often work with wealth management firms. Their clients have earned significant money and want to be generous and give back. They might have a $1,000 donation or a million-dollar donation, but they want to know it is going to the right place.

That is where we come in. We provide that stamp of endorsement and vetting. Donors can choose from three different levels: Classic, Premium, and Ultimate. They can also customize the process and say, “I would like these specific areas to be vetted and measured.”

Having a consistent stamp of endorsement is important. Our team is used to vetting organizations again and again. We have seen so many different scenarios. This is not one-off vetting. We have years of experience seeing how nonprofits measure up, where they need to improve, and which ones should be avoided.

Alan Olsen:
Can generosity ever be ineffective, even when the heart behind it is sincere?

Pamela Hawley:
Yes, I think it can.

As donors, we need to understand our top criteria for making effective philanthropic decisions. At UniversalGiving, we help with that through our philanthropy services.

We work with families and help them understand the parents’ desires in giving, as well as the children’s desires. Then we help them identify their top three criteria.

For some people, the criteria may be finances. For others, it may be impact — how many meals are served, how many youth are helped, or whether even one individual life is changed.

Coming up with those top three reasons — your true north, your guiding point — is very important. There is a lot of noise and a lot of different ideas out there, but as an individual, you need to take ownership and identify the top three criteria that will guide your giving.

UniversalGiving’s philanthropy services help run those sessions and guide people through that process.

Alan Olsen:
What are some of the common mistakes people make when they give, especially when trying to help communities or causes they are not personally familiar with?

Pamela Hawley:
One big mistake is not looking more closely at expenses.

There are nonprofits that have chartered jets, for example. I think it is important to look at how organizations are spending their money. You cannot always find that out from a regular document. Sometimes you need to ask for more information.

When you go to a nonprofit, do not be afraid to ask for more information. They should have it. And if they do not, that is a great lesson for them to learn — that they need to have more information prepared and available. It only strengthens the organization.

So I would say one important thing is getting to know the finances more deeply.

It is also important, when possible, to talk to people who have been affected by the nonprofit. If a home was built for someone, how did that go? If a child was able to go to school who otherwise would not have been able to, what was that experience like?

See if you can talk to the people who have actually been affected by the nonprofit.

One of the biggest mistakes is simply looking at a huge brand name and assuming everything is okay. That is not always the case.

Alan Olsen:
UniversalGiving places a strong emphasis on vetting nonprofit organizations. Why is vetting so important, especially in international giving?

Pamela Hawley:
If you are not able to go around the block and visit the nonprofit in person, then you need more than basic due diligence. You need an actual official stamp of vetting.

UniversalGiving has been doing this for 25 years. We have seen almost everything — fraud, terrorism, lack of positive management, and issues related to organizational culture and leadership.

We also include issues like the Me Too movement as part of our vetting process, where we evaluate management inside the organization.

You want an official vetting stamp from a third party that does this professionally. That helps you feel secure about what you are doing abroad, especially if you cannot go there yourself.

That is also why UniversalGiving brings volunteering and giving together. We know that people who volunteer are more likely to give. If you can schedule a trip and volunteer through our site, we love that. We have thousands of volunteer opportunities.

It gives you, a friend, or your family the chance to have a life-changing experience. You can help build a home in Uganda, clean up a river, or work on the strategy for a school being started in a community.

It is both strategic and hands-on. When you do that, it is incredibly positive. There is so much learning, growth, and change within yourself.

A woman recently volunteered through our site, and she sent me an email testimonial. She said, “You changed the relationship between my daughter and me. We were not really connecting. We went through UniversalGiving and served in a medical clinic in Haiti, and it changed our relationship.”

So it is not just about giving. It is about volunteering from the heart. It is about seeing other people’s lives, caring about what is happening in the world, and contributing to it. You come back changed.

If you want to get involved in international giving, volunteering first is a great way to get the lay of the land and then be able to donate as well.

Alan Olsen:
I love that.

I want to go a little deeper into the vetting services for nonprofits and philanthropic partners. Can you explain what those services involve and how your team evaluates whether an organization meets UniversalGiving’s standards?

Pamela Hawley:
Sure.

Usually, we work with individuals, corporations, wealth management firms, high-net-worth donors, billionaires, or people who have foundations. They want to vet nonprofits and make sure those organizations are in compliance with their family foundation standards, or simply know that the organization has been vetted.

We go through and create a rigorous report. It can range anywhere from eight to 20 pages, depending on the amount of information available on the nonprofit.

We have prepared vetting stages that the client has agreed upon. Then we provide written analysis under each section. Each section includes a recommendation, and at the end we provide a rating as to whether we recommend they avoid or invest in the organization.

We have worked with companies and donors where we have vetted hundreds or even thousands of nonprofits. We come back with a recommendation.

They do not have to follow that recommendation, but it helps them know whether their decision is being supported by a third-party organization.

At the end of the report, we include a summary. That summary highlights all the positive things about the nonprofit and commends them for the good work they are doing. It also includes a section on areas they need to work on and a section on red flags.

We actually divide the report into regular text, yellow text, which identifies areas to work on, and red text, which identifies major warning signs.

Alan Olsen:
I love that. Few people are out there providing the kind of service you are providing for organizations.

When an individual is looking at a nonprofit’s credibility, transparency, and effectiveness, what should they be looking for?

Pamela Hawley:
First, you want to make sure you are comfortable with the finances. Everyone has a different view of how much a nonprofit should be spending and what it should be spending on.

Some people are comfortable with lobbying. Other people are not. So you want to look closely at how the organization is spending its finances.

Second, are you comfortable with the management team? We do this in investing all the time. We ask, “Who is leading this company?” The same applies to a nonprofit. Who is leading it? And not just the CEO — look at different levels of staff.

You want to feel comfortable with the ethos, culture, and mission of the organization, and you want to see that reflected throughout the organization.

Third, there is an area that is absolutely critical. We defend very vigorously against terrorism, fraud, and financial noncompliance.

One of the things we have seen with nonprofits is that certain risks can move in and out of an organization. Someone could have a terrorist liaison and join the board, then later be off the board. That is why we vet both staff and board members. I think many people miss that. We are not just vetting staff; we are also vetting the board.

Another thing people miss is that the problem is not always an obvious bad act. Sometimes it is a lack of compliance or a lack of understanding about how to do basic, sound financial management.

If an organization does not have that in place, it will not be run well. Sometimes it may not be bad intention. It may simply be incompetence, where additional training is needed.

Alan Olsen:
Are there red flags that donors should look for before giving to an organization?

Pamela Hawley:
Yes, definitely.

One red flag to look for is overhead. If it is over 20%, some donors become concerned. Some of our donors want overhead to be closer to 10% to 12%. That does not always work for every nonprofit, because some nonprofits are very people-intensive, but overhead is something to examine.

You also want to look at impact. The way an organization states its impact should include both anecdotal impact and numerical impact.

Anecdotal impact means real stories of people affected on the ground. Numerical impact means how many people were affected.

For example, I mentioned the story of a mother and daughter going to Haiti and serving in a medical clinic. That is anecdotal. A numerical example would be that UniversalGiving has matched 24,000 volunteers with nonprofits all over the world.

You want to look at numbers in some way, but do not be so rigid that you demand the numbers only in your preferred format. Let the nonprofit tell its story. They started it. They run it. Let’s hear their story.

Make sure you are getting stories from nonprofits, not just numbers.

Alan Olsen:
Good advice.

For someone listening who wants to become a wiser giver, what is one practical step they could take before making their next donation?

Pamela Hawley:
One practical step would be to get involved and volunteer.

Try to be part of what the organization is doing. You will feel it. You will see it. You will experience it. You will see the challenges of the day-to-day and the positives of the day-to-day.

You might see how hard it is to orchestrate something simple, like serving food. What happens if 50 more people suddenly show up? How does the nonprofit handle that?

I have seen innovative nonprofits respond by going to the freezer, cooking more food, buying food at the grocery store, or coming up with other creative solutions. When you see an organization go through a small crisis like that, you get to see how they operate.

You want to work with operators who can respond in an unknown moment. How do they handle something unexpected?

The way you see the unexpected is by being on the ground and volunteering with them. The unexpected is not going to appear in an annual report. You see how they operate when you are working side by side with them — building the home, strategizing about the new school, or serving the community.

So be with them. Spend time with them. Understand them. I think that is a critical criterion that many people do not think about.

If there is a small crisis or something does not go well, how does the nonprofit handle it? Do they simply say, “We ran out of food,” or do they go buy more? Do they cook more? How do they respond?

Get in there. Be by their side. Be part of the solution, and also watch how they handle it.

Alan Olsen:
Pamela, what is the preferred method of contact for individuals who want to engage with or learn more about UniversalGiving?

Pamela Hawley:
The best place to start is our website. We are a Tech for Good nonprofit, and our website is www.universalgiving.org.

UniversalGiving is also on social media. I post a lot on LinkedIn as Pamela Hawley — that is H-A-W-L-E-Y. We are also on Instagram, Facebook, and X.

Please follow us on social media. We are constantly posting about our vetted nonprofits, so you can learn more about them there.

And I would also say, you are always welcome to email me. As CEO, I love to help people.

Alan Olsen:
Pamela, thank you for being with us here on American Dreams.

Pamela Hawley:
Thank you so much for having me, Alan, and thank you for having UniversalGiving and being part of our vision to create a world where giving and volunteering are a natural part of everyday life.