The Importance of Regulatory Due Diligence in M&A Transactions
Compliance with regulations is more crucial than ever before as the global business landscape continues to evolve and the complexity. It is imperative to be thorough when seeking investment, funding or partnerships. This https://fitboardroom.com/esg-due-diligence-in-investment-planning/ will ensure that your business is compliant now and in the future.
Regulatory due diligence is a method of evaluating, monitoring and ensuring compliance with laws as well as regulations. It covers a broad range of topics, including legal compliance, environmental practices, corporate governance, data privacy and more. It can be used to assess a target’s ability to adapt and improve its technological capabilities.
It’s a must for any M&A transaction to have this. According to research by MetricStream, the rate of failure for deals in the world is anywhere from 70% to 90% with issues with regulatory regulations, geopolitical uncertainty and poorly-planned acquisitions being among the top three reasons. Being vigilant in the regulatory realm can help reduce these risks, thereby increasing the likelihood of a successful outcome.
Due diligence on regulatory compliance is required in conjunction with commercial and financial M&A due diligence to limit the risk. Failure to identify compliance issues can result in significant fines and lost profits, and a damaged reputation. This could even lead to the possibility of a criminal conviction in some instances. It is important to be proactive and select a solution that lets you conduct due diligence and regulatory screenings across different jurisdictions. Nexis Diligence+ ™ integrates an integrated business intelligence platform as well as anti-money laundering service (AML), anti bribery and corrupt (ABC), and the forensic services into one source.
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