Because the World Needs a New Way to Conduct Due Diligence

Conforming to regulatory obligations is becoming increasingly complex for enterprises around the world, which has significantly increased the need for new approaches to compliance and the way that due diligence is conducted.

This blog will delve into the catalysts behind the new era of due diligence, focusing on the power of automation, scalability, and the prospect of compliance creating value, as opposed to detracting from it.

Demands for a New Due Diligence

Evidently, the old, manual, way of doing due diligence is no longer working well enough to meet industry standards. Traditional due diligence is immensely time-consuming. That in itself is reason enough to aspire for a new way of keeping complaint. However, saying that, let's play devil’s advocate for a second. Perhaps you have all the time in the world to conduct your due diligence, but this does not address the other major problem with manual due diligence: human error.

Without question, manual processes are much more prone to human error. No matter how conscientious your employees may be, mistakes are bound to happen due to the sheer number of touchpoints involved in manual due diligence. The result? Missed red flags, inaccurate risk assessments, and, thus, increased risk exposure. Even the most meticulous attention to detail can’t be sustained indefinitely. This reflection brings us to the future of due diligence – the key pillar being automation.

Customizable Automation

Various studies have shown time and time again that automation can save organizations hundreds of hours in work by automating otherwise manual functions (such as data gathering, updating with new regulations, streamlining workflows etc.).

In addition to time (and money) savings, automation removes the human error attributed to manual compliance processes, all the meanwhile protecting sensitive data and keeping business up to date with changing regulations.

The cherry on top of automation is customization. Automation is ‘all talk, no walk’ without being able to tailor it to your unique business needs, e.g. the sequence of process steps, what goes for manual review or not, how and when to reach out to the UBO or client for renewal – the list goes on! As such, automation is by no means the opposite of customization.

Further advantages of automation is that it allows your due diligence process to match the pace of emerging and constantly evolving threats, meaning that you can proactively identify and manage potential risks before they become significant problems. Without tedious administrative tasks slowing you down, your compliance lifecycle will become more proactive, as opposed to reactive – keeping hefty legal and financial consequences as a result of non-compliance at bay.

Scalable Due Diligence

Without question, an effective due diligence tool must be scalable, as well as seamlessly integrate with an organization’s existing processes. Scalability ensures the tool adapts to growing volumes of data, users, and requirements, without compromising on the quality of data. Meanwhile, integration eliminates the need for parallel data entry or manual workarounds, saving time, reducing touchpoints, and minimizing errors.

Compliance With Value Creation

What if we told you that there are compliance tools out there that can actually contribute to your commercial success? Not only does this new era of ongoing due diligence and automation minimize the chances of non-compliance, it also facilitates value creation by encouraging people across organizations to focus on core business activities and critical tasks. This shift transforms due diligence from a burdensome requirement into a strategic advantage, enhancing compliance ROI with minimal effort.

Your Forward-Thinking Due Diligence Platform

The new era of ongoing due diligence is not about building or doing more, it’s about gaining more from doing and building less. Without question, regulatory compliance automation is a priority for all organizations, and with newer, automated approaches, due diligence no longer has to be a tick-box exercise.

Whilst we’ve been writing about the future of due diligence, it’s important to point out that some state-of-the-art compliance automation tools already exist…such as spektr – created to transform manual compliance tasks into automated workflows, all through a centralized, no-code platform (try it out yourself).