In the words of Mark Mendelsohn, former deputy chief of the Fraud Section of the U.S. Department of Justice:
“Third-party due diligence must be robust, thorough, impeccably documented and preserved.”
Conducting due diligence on third parties and investors, for internal or external purposes, is a key component of an effective risk-based compliance process and a regulatory duty for key players in the fund and financial services industry.
On top of the regulatory and best practice challenges, conducting due diligence is a significant operational undertaking for companies dealing with numerous counterparts.
It is not just a question of designing, creating and sending the questionnaires, it is about following up, reviewing and rating, then multiplying these arduous, unavoidable tasks by the number of counterparts. And let’s not forget that it all needs to be done on an annual basis.
It will come as no surprise that this process is far from efficient (most due diligence are carried out manually using Word or Excel), and companies are in fact faced with serious security issues: lack of a proper audit trail and the dangers of exchanging documents and information via email.
To meet this ever-increasing need for transparency and efficiency, Governance.io offers companies conducting due diligence a 100% audit-trailed and secure digital solution focussing on a state-of-the-art and intuitive user experience for all parties: the company conducting the due diligence and the third party assigned the due diligence.
It seems only appropriate to elaborate on Mendelsohn’s words:
“Third-party due diligence must be robust, thorough, impeccably documented, preserved, easy to conduct, follow up, review and rate.”
To find out more about Governance.io and its online Due Diligence module, click here.