third-party due diligence integrating in-house technology and outside services providers
TRANSCRIPT
Third-Party Due DiligenceIntegrating In-house Technology and Outside Services Providers
Agenda
Brief Introduction of Speakers
Evolving Third-Party Risk Management Standards
Engaging Third-Party Providers
Q&A
Today’s Evolving Standards
Companies are integrating basic to advanced technology platforms to monitor third-party relationships Creates a repository of key, auditable data Maintains approval limits and accountability Back-end risk methodology to assign risk ratings Contract database that maintains integrity of document versions
showing of risk analysis Integration of guidance when to engage an outside due diligence
provider
Sample Technology Workflow
Engaging Third-Party Providers
Providers:
Build upon work already completed by in-house systems to avoid inefficient duplication of work
Enhance in-house due diligence by extending its reach to hard-to-find records and human intelligence
Communicate findings clearly with a defined scope of work to help you internalize our work
Cost-Effective Scope of Work
Level 1: Public Records / Database Research Suitable for low- to medium-level risk targets Verification of bona fides disclosed in the Questionnaire Thorough review of publicly available documents such as corporate records,
court records and local media Tailored scope to suit in-house pricing needs and avoid duplicative work
Level 2: Human Source Inquiries Suitable for medium- to high-risk targets
Ongoing Role In-house teams need to refresh due diligence periodically Costs can be kept down by going to the same outside provider every two years
rather than engaging someone new each time
When Intelligence Matters
Significant questions are unanswered in the public. Examples:
Is the ongoing investigation/litigation involving our potential agent likely to lead to any risk-relevant actions or sanctions?
A tabloid described our agent as a corrupt arms dealer, but he says that it’s not true and he’s never been convicted of wrongdoing.
Is the John Smith cited on the OFAC list the same John Smith we’re engaging? It’s a common name and there’s limited public information.
Is our agent going to fall out of favor with when the government changes after the election, and what would that mean for our business?
Human Sources
Thorough Level 2 due diligence includes speaking with knowledgeable sources from three broad angles:
Government sources with knowledge of past or current investigations and official actions
Industry sources that are familiar with subject’s reputation within the field
Professional sources such as business consultants, lawyers and journalists that have researched the subject before or can provide broader context
Questions?
Michael Harrington Greg Shultz, Managing Director
www.thecompliancetable.com
mintzgroup.com