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Diligence

for Asset Owners

Diligence lays the foundation for successful investing and should be implemented in all phases of the investment cycle.

To be effective, diligence programs must be relevant, operational, dynamic and practical.

Our experienced professionals provide specific governance, risk and compliance diligence services designed to minimize the risk of loss, maximize risk opportunities and drive stakeholder value—we will:

  • Develop robust, risk-based diligence programs designed to meet regulatory requirements, board oversight responsibilities and strategic business objectives
  • Diagnose existing diligence program activities to ensure they are relevant, cost-effective and aligned with organizational goals
  • Incorporate existing and new regulatory requirements, as well as industry best practices, so that your diligence program meets stakeholder expectations.

 

Proprietary Services
ACTIVUS Fundraising Manager
Diligence Services for Asset Owners

Before asset owners can make initial and ongoing investments, they must determine whether prospective asset managers have effective governance, risk, compliance and operational capabilities. Unfortunately, manager fundraising periods often overlap creating time constraints for asset owners seeking to conduct diligence reviews before committing long-term capital. Our professionals can ease the pressure during multi-manager fundraising processes—we will:

  • Customize diligence requests to incorporate new regulatory developments and emerging risks
  • Review diligence responses to identify inaccurate, false or misleading information
  • Identify potential sources of legal, compliance, operational and reputational risk among asset managers
  • Perform remote and onsite diligence reviews of asset managers and asset consultants
  • Detect gaps in asset manager programs relating to governance, risk management, compliance and operations
  • Evaluate disclosures across stakeholder categories to identify inaccurate, false or misleading statements, including those that may be inconsistent with the asset managers’ written policies and procedures
  • Ensure diligence reviews are consistent with your internal compliance and audit program requirements.
ACTIVUS Diligence Manager
External Manager Diligence Verification

Inadequate or limited diligence of third-party asset managers is a leading cause of failed investments. Although many factors lie outside the control of asset owners, ongoing diligence should not be one of them. After all, asset managers may fail to respond to specific information requests or they may provide information that is incomplete, inaccurate or materially false. As former heads of legal, compliance, risk management and internal audit functions, our experts have experience both requesting diligence information and responding to investor information requests—we will:

  • Help you understand the key legal, compliance, governance and operational risks associated with certain asset managers based on the nature, size and complexity of their fund activities
  • Develop due diligence questionnaires (DDQs), annual compliance certifications and other diligence documents tailored to specific asset classes and manager categories, including multi-asset and complex fund managers
  • Incorporate new regulatory developments and emerging risk topics into diligence requests
  • Identify gaps, inconsistencies and inaccuracies in manager responses to diligence requests
  • Implement a consistent diligence program across asset classes
  • Diagnose the governance, risk, compliance and operational capabilities of new and emerging fund managers
  • Evaluate the governance, risk, compliance and operational capabilities of asset consultants to determine whether investment recommendations are consistent with your organization’s investment objectives and restrictions
  • Perform diligence on existing and prospective asset managers during manager fundraising periods and assist organizations in deciding whether to invest or re-invest with specific managers.

 

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