Supplier due diligence is the check, made before award, that a supplier is who it says it is, is not excluded from the contract by law or by your donor, can actually deliver what it has offered with the capacity it really has, and will produce the records your organisation must keep. Registration documents start that check; they do not finish it. A valid licence proves a company exists and may trade. It does not prove the company can deliver 2,000 kits to four provinces in three weeks, and a supplier registration on a UN or donor portal is a roster entry, not an approval of competence.
The UN's Procurement Practitioner's Handbook (opens in a new tab) puts it plainly: before recommending an award, make sure the supplier whose offer is most advantageous is also qualified to carry out the contract, considering its performance record, financial strength, integrity, experience and capacity. The checklist below turns that into questions you can put to a supplier in Afghanistan, and says which answers to verify yourself.
Legal identity and current documents
Ask for the business licence and the tax registration, and look at what they actually say:
- The same entity throughout. The name and number on the licence, the tax registration, the quotation, the contract, the invoice and the bank account to be paid should all belong to one legal entity. A related company with a similar name is a different supplier.
- Valid today. Check the dates on every document. An expired licence, or one whose renewal you have not seen, proves nothing about the present; ask for the current one.
- Activities covered. Whether the licence covers the kind of work you are buying.
- Who may sign. The person who will sign the contract, and the document that gives them that authority.
See the originals where you can, keep copies in the file, and verify with the issuing authority where your organisation's rules require it, before award rather than after.
Exclusion lists and screening
Screen the supplier, and where your rules require it its owners and directors, against the lists your organisation and your donor name. These usually include the United Nations Security Council Consolidated List (opens in a new tab), which brings together everyone subject to Security Council measures, including the 1988 sanctions list; the World Bank's list of ineligible firms and individuals (opens in a new tab) for World Bank-financed work; and your donor's and your own organisation's lists. Lists change, so record the date of each check and the result, and repeat the check when the contract is renewed or extended.
References and similar work
Ask for references for work of the same kind, scale and geography as yours, with a name and a telephone number for each, and call them. Ask the referee what the supplier did itself and what it subcontracted, whether the work finished on time and with complete records, and what happened when something went wrong. Completion certificates or reference letters on the client's letterhead are worth asking for; a list of client names or logos is not a reference.
Ask, too, for a sample of the records the supplier produces, with personal data removed: a waybill, a goods received note, a distribution report or a closeout report from a past assignment. Records are what you will receive, so see them before award.
Capacity it will actually use
Separate what the supplier owns, what it rents or contracts, and what a subcontractor will provide:
Vehicles
Owned or contracted, the classes and how many, and who drives and maintains them.
Storage
Where the goods will be stored, whose premises they are, and under what arrangement.
Staff
Who will manage the assignment, who will be in each province you named, and whether they are permanent staff or engaged for the assignment.
Presence in the provinces
For each province: a permanent office, a coordinator, a partner or subcontractor, or a team deployed when the work starts. All four can work; you need to know which one you are buying.
Subcontractors
Who they are, what they will do, and who answers for their performance and their conduct.
For high-value or strategic contracts the handbook recommends a site visit to the supplier's premises before the evaluation is final; tell all suppliers in the solicitation that one may take place, and record what was seen.
Samples and quality checks
For goods, ask for samples before award and check them against the specification. Ask how the supplier inspects goods from its own suppliers, and what inspection record you will receive at delivery. For services, ask how quality is supervised in the field and how a failure is reported to you.
Conflicts of interest and separation of duties
Ask the supplier to declare any relationship with your staff, with other bidders or with the people who will receive the goods. Ask your own staff involved in the procurement to declare theirs. Keep sourcing, approval and payment with different people, and do not let anyone who has declared a conflict evaluate or approve the offer.
Financial and contract arrangements suited to the assignment
Match the financial check to the contract. The handbook's test is financial capacity appropriate to the value of the contract; ask for the evidence your rules require, and no more. If the supplier will pre-finance purchases, check it can, and write the limits and the payment trigger into the contract. Pay only into an account in the contracting entity's name, and treat any request to change bank details mid-contract as something to verify through a known contact before acting on it.
Evidence, reporting and access
Confirm before award which records the supplier will produce, in which templates and language, and how often it will report. Ask whether your organisation and your donor will have audit access to its records for the assignment, and how long it keeps them. If the assignment involves recipients' or participants' personal data, ask how it is collected, stored, shared and destroyed. And ask how the supplier tells you when access to a location is lost or a delivery will be late, and how quickly.
Conduct and safeguarding
Ask for the supplier's code of conduct, how its staff and drivers are briefed on protection from sexual exploitation and abuse (PSEA) before deployment, how a complaint is raised, and its policy on gifts and facilitation payments. Then make your own code a condition of the contract.
What to ask, and what to verify yourself
| Claim | Ask the supplier for | Verify independently by |
|---|---|---|
| Legal existence | Ask the supplier forLicence, tax registration, authority to sign | Verify independently byChecking dates and names match; the issuing authority where your rules require it |
| Not excluded | Ask the supplier forA declaration | Verify independently byScreening the lists your rules and donor name, on a recorded date |
| Similar experience | Ask the supplier forReferences and completion letters | Verify independently byCalling the referees yourself |
| Capacity | Ask the supplier forLists of vehicles, premises, staff, subcontractors | Verify independently bySeeing them, or a sample, on a site visit |
| Presence in a province | Ask the supplier forWho is there and in what arrangement | Verify independently byAsking a referee who worked there; meeting the coordinator |
| Records | Ask the supplier forA sample with personal data removed | Verify independently byComparing it with what your donor requires |
| No conflicts | Ask the supplier forSigned declarations | Verify independently byYour own staff's declarations; your knowledge of the bidders |
| Financial capacity | Ask the supplier forThe evidence your rules set for this contract value | Verify independently byYour finance team's review |
The checklist
Supplier due diligence checklist
Completed by the requesting organisation before award and kept in the procurement file. Repeat at renewal.
The supplier and the contract
Supplier's legal name
Contract or RFQ reference
Value band and risk, under our rules
Checked byName and role
Date of the check
Identity and documents
| Document | Number | Issued by | Valid until | Original seen? | Name matches? |
|---|---|---|---|---|---|
| Business licence | |||||
| Tax registration | |||||
| Authority of the signatory | |||||
| Other registration required |
Quotation, contract, invoice and bank account in the same entity's name
- Licence covers the activities in this contract
Verified with the issuing authority, where our rules require it
Screening
| List | Searched for | Date | Result | Checked by |
|---|---|---|---|---|
| UN Security Council Consolidated List | ||||
| Donor's exclusion list | ||||
| Our organisation's list | ||||
| Other list our rules name |
References and records
| Referee and organisation | Work and year | Called on | What the supplier did itself | Comments |
|---|---|---|---|---|
- Completion certificates or reference letters seen
- Sample records seen, with personal data removed
Capacity
| Resource | Owned | Contracted | Subcontracted | Seen? | Notes |
|---|---|---|---|---|---|
| Vehicles | |||||
| Storage | |||||
| Managing staff | |||||
| Field staff | |||||
| Equipment |
| Province | Office, coordinator, partner or deployed team | Who | Confirmed by |
|---|---|---|---|
SubcontractorsWho, what they do, who answers for them
Site visitDate, who visited, what was seen
Quality
- Samples checked against the specification
- Supplier's own inspection described, and its record seen
Conflicts and separation of duties
- Supplier's conflict-of-interest declaration signed
Our staff's declarations collected; anyone conflicted excluded from evaluation
- Sourcing, approval and payment held by different people
Financial and contract
Financial evidence seenAs our rules set for this value
Advance or pre-financingRequested or offered; limits written into the contract
- Payment only to an account in the contracting entity's name
- Changes to bank details verified through a known contact
Records, reporting, access and data
- Records, templates, language and reporting frequency agreed
Audit access for us and our donor, and how long records are kept
Handling of personal data agreed, where the assignment involves it
- How and how fast access problems and delays are reported
Conduct and safeguarding
Supplier's code of conduct seen; ours made a condition of contract
- PSEA briefing before deployment, and a complaints route
No gifts or facilitation payments, in policy and in the contract
Result
ResultQualified, qualified with conditions, or not qualified
Conditions or follow-up
Reviewed and approved byName, role, signature and date
If you are checking Zhikal
The same questions apply to Zhikal. Its registration identifiers, including its UNGM vendor number, are on the Experience page with a request route for the documents behind them; a UNGM number is a supplier registration, not a United Nations approval, accreditation or endorsement. Completion certificates, client references and registration, tax and compliance documents are provided to procurement panels on request. The organisation chart shows who leads an assignment and how it escalates, and the coverage page shows which coordination zone each province belongs to and the city it is coordinated from.
Zhikal runs the same kind of check on its own suppliers before it uses them: trade licence verification, capacity assessment, reference checks and conflict-of-interest declarations, as part of its procurement cycle. To ask for documents or references, write to the team in Kabul.
Sources
- UN Procurement Practitioner's Handbook (2006) (opens in a new tab)
Inter-Agency Procurement Working Group, published by the Logistics Cluster. Long-term agreements, supplier eligibility and post-qualification, clarifications during solicitation and evaluation, and due diligence.
- United Nations Security Council Consolidated List (opens in a new tab)
United Nations Security Council. All individuals and entities subject to measures imposed by the Security Council, including the 1988 sanctions list.
- World Bank Listing of Ineligible Firms and Individuals (opens in a new tab)
World Bank. Firms and individuals debarred from World Bank-financed contracts, with the periods of their ineligibility.
External sources are cited for the facts they report and were checked when this guide was last updated. Citing them implies no relationship with, or endorsement by, their publishers.