Public funding cuts keep coming, calls for proposals are becoming more selective, and finance teams spend more time justifying every euro than steering programmes. In this context, more and more NGO and CSO boards are asking a question that was long taboo: should we move closer to another organisation, pool certain functions, or even merge? A recent study by Coordination SUD's OngLab, conducted among leaders of international solidarity organisations, shows that resource pooling and mergers are now among the options seriously considered in response to the collapse of public funding. For a chief financial officer, a finance coordinator or a programme manager, the subject is far from abstract: a merger of associations affects ongoing donor agreements, the audit trail, restricted funds and the continuity of field operations.

This article takes stock of what a rapprochement between international solidarity organisations actually involves: the different possible forms, the financial and contractual stakes, the blind spots in compliance and audit, and the often underestimated work of converging information systems. We will also see how an integrated platform such as Abvius can secure the transition, preserving the traceability that donors require while the organisations reorganise.

NGO mergers: how to succeed in a rapprochement without losing donor trust

Reading time: ~14 min

1. Why rapprochements are accelerating in international solidarity
2. Cooperation, pooling, merger: what are we talking about?
3. The financial and contractual stakes of a rapprochement
4. Compliance and audit: the blind spots of an association merger
5. Merging information systems: the underestimated workstream
6. How Abvius secures an NGO rapprochement
7. The steps of a successful rapprochement
8. Mini FAQ

Why rapprochements are accelerating in international solidarity

The sector is going through a budget contraction without recent precedent. International humanitarian funding fell by roughly 30% between 2022 and 2025, and several major institutional donors have reduced or reconfigured their official development assistance envelopes. In France, international solidarity organisations describe a scissors effect: needs rising in the field, public resources growing scarcer, and compliance requirements that do not shrink.

Faced with these headwinds, the Coordination SUD OngLab study identifies three broad strategies: continue the existing model, adapt gradually, or reinvent oneself profoundly. Among the adaptation levers cited by the leaders interviewed are tightening activities, reducing overheads, diversifying funding — and pooling resources, which can range from simply sharing premises to the full merger of two organisations.

A movement that goes beyond France

The phenomenon is not limited to France. In several European countries, mid-sized NGOs are joining forces to reach the critical mass required by certain funding windows: minimum absorption capacity, an internal audit function, compliance systems (screening, AML-CFT, safeguarding) that a small structure struggles to fund alone. Donors themselves, by concentrating their portfolios on a smaller number of partners, indirectly encourage organisations to group together to remain eligible.

It would nevertheless be reductive to see rapprochement only as a defensive response. Well designed, it can preserve threatened programmes, retain experienced field teams, and offer donors a more robust counterpart — provided you do not lose along the way what makes an organisation valuable: its accountability, its traceability and the trust of its partners.

Cooperation, pooling, merger: what are we talking about?

The term "rapprochement" covers a broad spectrum, from the loosest to the most binding. Clarifying the vocabulary is the first step of any serious reflection, because each form carries very different legal, financial and operational consequences.

• One-off cooperation: two organisations respond together to a call for proposals, set up a consortium with a lead partner, or coordinate their interventions in the same area. Each keeps its legal personality, its accounts and its agreements.
• Pooling: the organisations durably share resources — premises, support functions, a management tool, compliance expertise — through a pooling agreement or a dedicated structure (employers' group, resource-sharing association). Budgets remain separate, but allocation keys for shared costs must be defined and documented.
• Alliance or union: the organisations create a common umbrella entity (network, federation) that carries certain functions — advocacy, fundraising, quality frameworks — while leaving members autonomous.
• Merger: one organisation absorbs the other (merger by absorption) or two structures dissolve to create a new one (merger by creation). There is a universal transfer of assets: assets, liabilities, employment contracts, funding agreements, commitments and disputes pass to the absorbing or new structure.

Choosing the form that fits your situation

Merger is not the mandatory outcome of every rapprochement. A successful pooling arrangement may be enough to restore the economic balance of two structures, and a rushed merger can destroy more value than it creates: loss of long-standing donors, departure of key managers, incompatible organisational cultures. The question to ask is not "should we merge?" but "what degree of integration best serves our respective social missions, and at what transition cost?". It is precisely to answer this question that the rapprochement project must rely, very early on, on reliable and comparable financial data from both sides.

The financial and contractual stakes of a rapprochement

For finance teams, a rapprochement — and even more so a merger of associations — hinges on a few critical files that must be opened from the study phase.

The fate of ongoing funding agreements

This is the most sensitive point. Most grant agreements contain so-called intuitu personae clauses: the donor contracted with a specific organisation, after due diligence, and any change in legal structure requires prior notification, or even written consent. A merger carried out without notifying donors can constitute a breach of contract, opening the way to suspension of payments or recovery of funds. In practice, you need to:

• list all active agreements of both organisations, with their assignment and change-of-control clauses;
• notify each donor in the prescribed form, presenting guarantees of continuity (teams, internal control, financial capacity);
• obtain transfer amendments before the effective date of the merger;
• check the consequences for approvals and registrations (country-of-operation approvals, tax registrations, labels).

Restricted funds, reserves and commitments

The transfer of assets includes that of restricted funds: resources allocated by donors and funders to specific projects remain legally earmarked after the merger. The merger agreement must identify them line by line, and the accounting of the merged structure must allow them to be tracked without interruption. The same applies to off-balance-sheet commitments: promised co-financing, guarantees given, country office leases, multi-year supplier contracts. A cross-audit — each organisation examining the other's accounts, audit reports and disputes — is essential: you do not merely merge assets, you also inherit the partner's unresolved audit findings and potentially ineligible expenses.

The real cost of the transition

The expected economies of scale (support functions, rent, licences) are real but deferred: in the first year, a rapprochement costs before it pays. Legal support, harmonisation of employment contracts, system migration, double accounting close, communication to stakeholders: organisations that succeed budget the transition as a project in its own right, sometimes with the support of organisational strengthening funding schemes.

Compliance and audit: the blind spots of an association merger

An association merger that is successful on paper can fail in front of an auditor eighteen months later. Donors will continue to audit the past expenses of both former structures, under the rules of each agreement, for the whole contractual document-retention period — often five to ten years. Three blind spots come up systematically.

Continuity of the audit trail

Every past expense must remain linked to its supporting document, its budget, its approval and its financial report, even after the dissolution of the entity that incurred it. If the archives of the absorbed organisation are scattered — decommissioned servers, moved filing cabinets, closed mailboxes — the audit trail breaks, and with it the ability to defend the eligibility of expenses. The merger plan must therefore include an archiving workstream: inventory of documents, import of historical accounting data, retention of read-only access to former systems or a complete, indexed export.

Harmonising internal control

Two organisations mean two procedures manuals, two delegation-of-authority schemes, two procurement thresholds, two approval workflows. During the transition period, the risk is to see contradictory rules coexist — or worse, a vacuum: teams who no longer know which threshold to apply or who signs what. Auditors pay particular attention to this, because periods of reorganisation are statistically prone to fraud and errors. The switchover must be dated precisely: until day D, procedures A and B each apply to their own scope; from day D, a single, circulated and signed manual prevails.

Cross due diligence and screening

The structure resulting from the rapprochement inherits the partners, suppliers and sub-recipients of both organisations. Due-diligence obligations (sanctions screening, AML-CFT, safeguarding policies) must be reapplied to the entire consolidated portfolio: a supplier validated by one organisation under looser criteria will need to be reassessed against the common framework. It is also the time to check the compatibility of commitments made to the respective donors, some of which impose stricter clauses than others.

Merging information systems: the underestimated workstream

In most rapprochements, the convergence of management tools is dealt with late, as a technical question. This is a mistake: the information system is where continuity of traceability is actually decided. Three scenarios generally arise.

Keeping two systems in the long run is the default choice — and the most expensive over time: it freezes the merger halfway and complicates every closing. Extending an existing office tool shifts the problem onto the teams, who compensate with consolidation files whose reliability declines over time. Migrating to a common platform requires an initial effort, but it is what makes the rapprochement real day to day: same reference data, same workflows, same data for headquarters and the field.

Importing history without betraying it

A successful migration does not just load opening balances: it imports budgets per agreement, ongoing commitments and financing plans, and keeps organised access to historical documents. Donors do not require the old software to stay switched on; they require every past expense to remain justifiable. A structured export, indexed by project and by agreement, integrated into the new platform or archived alongside it, meets this requirement.

How Abvius secures an NGO rapprochement

Abvius was designed for NGOs, CSOs and international solidarity organisations that manage multiple donor funding streams, with teams split between headquarters and the field. In a rapprochement context, several capabilities of the platform take on particular importance.

• Real-time budget monitoring makes it possible to steer a consolidated scope from the transition phase: each project, each agreement and each entity remains readable separately, while feeding an overall view shared by both management teams.
• The native audit trail timestamps every operation, every change and every approval. Expenses incurred before, during and after the switchover remain documented without a break — a decisive point when donor audits cover financial years straddling the merger.
• Configurable approval workflows translate the new delegation-of-authority scheme into the tool: unified thresholds, roles and workflows apply in practice, rather than depending on the memory of teams.
• Electronic signature streamlines contracting during the transition period — donor amendments, partnership agreements, mission orders — while keeping proof.
• Headquarters-field centralisation prevents country offices from falling behind during the reorganisation: teams work on the same data, including with limited connectivity.
• Automatic donor reporting produces financial reports in the expected formats, agreement by agreement, whatever portfolio each original organisation brings.

In other words, the platform does not decide on the rapprochement — that is a matter for governance — but it secures its execution: compliance and traceability stop being promises made to donors and become properties of the system. To learn more: abvius.org.

The steps of a successful rapprochement

Every rapprochement is unique, but the sector's lessons learned converge on a five-step sequence.

• 1. Investigate before deciding. Formalise a cross-diagnosis: financial situation, portfolio of agreements, disputes, ongoing audits, organisational cultures. Involve the governance bodies on both sides and give yourselves an explicit decision criterion — the best pursuit of social missions, not just the survival of the structures.
• 2. Map donor commitments. List all active agreements, their change-of-control clauses, and the approvals and labels concerned. Establish the timetable for notification and for obtaining amendments, handling first the donors whose consent determines the project's financial balance.
• 3. Budget and fund the transition. Cost the legal, HR, systems and communication expenses; identify recurring savings and their horizon; look for organisational-strengthening support schemes that could co-finance the process.
• 4. Unify procedures and systems on a fixed date. Publish the common procedures manual, the delegation scheme and the target analytical chart of accounts; plan the data migration with import of history per agreement; train headquarters and field teams before the switchover, not after.
• 5. Prove continuity to donors. In the first six months, produce financial reports on time, document the continuity of the audit trail and offer key donors a progress review. A rapprochement is judged on its first closing and its first audit.

Mini FAQ

Do you need donor consent to merge two associations?

Legally, a merger is a matter for the general assemblies of the associations concerned. But contractually, most funding agreements require informing the donor, and often obtaining written consent, before any change affecting the beneficiary's legal personality. Failing to do so exposes you to suspension of payments, or even recovery of funds.

What happens to restricted funds after a merger?

They are transferred with the assets but keep their earmarking: the new structure must use them in line with the original funders' intent and ensure separate accounting tracking. The merger agreement must inventory them precisely.

How long does a rapprochement take?

Generally allow twelve to twenty-four months between the first discussions and operational stabilisation: six to twelve months for study and decision, then an equivalent period for execution — donor amendments, HR harmonisation, system migration and first joint closing.

Can you pool a management tool without merging?

Yes. Several organisations can adopt the same platform while remaining legally distinct: each keeps its accounts and agreements, but licence, training and administration costs are shared, and a possible later merger is greatly facilitated. It is often a pragmatic first step.

Summary

In a sector under lasting financial strain, association mergers and, more broadly, strategic rapprochements have become legitimate options to preserve the social missions of NGOs and CSOs. Their success is not decided only in legal agreements: it depends on the ability to maintain, without a break, the traceability of expenses, the continuity of donor agreements and unified internal control — workstreams where the information system makes the difference between a controlled transition and years of difficult audits. If your organisation is considering pooling or a merger, we can show you how Abvius secures budget consolidation, the audit trail and donor reporting during the transition: contact us, or keep reading our other articles on NGO financial management and compliance.