Enhanced due diligence is a level of scrutiny that goes beyond the standard due diligence process. It is typically used in situations where there is a higher level of risk involved, such as when a company is considering making a significant investment or entering into a business relationship with another party.
The exact components of an enhanced due diligence process will depend on the specific context and needs of the situation, but it may include:
- A more thorough review of the financial records and financial health of the party being scrutinized
- An in-depth analysis of the party’s business operations, including supply chains, business partners, and regulatory compliance
- A review of the party’s management team and key personnel, including their backgrounds, qualifications, and potential conflicts of interest
- A detailed assessment of the party’s risk profile, including legal, regulatory, reputational, and operational risks
- A review of the party’s compliance with laws and regulations, including anti-corruption laws, money laundering regulations, and other relevant standards
- A review of the party’s media coverage and public reputation
- A review of the party’s intellectual property rights and proprietary information
Overall, the goal of enhanced due diligence is to thoroughly assess the risks and potential rewards of a proposed investment or business relationship, in order to make an informed decision about whether to proceed.
This page was last updated on January 2, 2023.