Why assess third parties?
To achieve its missions and objectives, companies develop relationships with third parties:
- sales agents and brokers,
- clients,
- partners,
- suppliers,
- potential investors,
- etc.
These third parties may present shortcomings or weaknesses that could jeopardise their long-term viability.
In addition to financial risks, the notoriety and reputation of their managers, the identity and stability of their shareholder base, amongst other elements, constitute risk factors in the development of a business relationship, thus potentially exposing the company.
In practice, the company could be held liable if its partner is involved in cases of corruption, money laundering or terrorist financing. In this field, the interpretation of legislation is increasingly restrictive with, for example, a broad definition of the concept of public official, as well as the extension of companies’ liability to cover the actions of intermediaries, agents or local representatives.
In this context, ADIT supports its customers in their process of evaluating and verifying whether their customers, intermediaries, partners, and potential stakeholders involved in their operations comply with applicable regulations.
Legislation and the fight against corruption
ADIT has provided Due Diligence services since the early 2000s and France’s ratification of the 1997 OECD Convention on Combating Bribery of Foreign Public Officials. Our investigations strictly adhere to corporate obligations regarding the prevention and combating of corruption (FCPA, UK Bribery Act, Sapin II law ), and with the recommendations of authorities in charge of monitoring the proper application of these standards (DoJ, SFO, AFA). Our Due Diligence products can also include the identification of potential violations of AML/CFT regulations, stock market regulations, Duty of Vigilance, GDPR, etc.
ADIT support
To meet these obligations, ADIT’s approach consists of enabling its clients to proceed to an upfront evaluation of the level of trust to be placed in a third party, and to obtain information required to secure planned business operations.
With over 30 years of experience in due diligence and compliance, ADIT supports you in managing the inherent risks of operations and partnerships with third parties, so as to enable you to make informed decisions and mitigate identified risks.
How to evaluate your third parties?
Our comprehensive range of products is divided in two categories that meet the obligations established by international (OECD Convention, Foreign Corrupt Practices Act, UK Bribery Act, etc.) and national (Sapin II Act) regulations.
The recent strengthening of international (Supply Chain Due Diligence Act in Germany, Modern Slavery Act in the UK, Child Labour Due Diligence Act in the Netherlands, etc.) and national ( Potier law on the Duty of Vigilance – “devoir de vigilance” in French) regulations prompting due diligence now places greater obligations on companies to prevent social, environmental and governance risks related to their operations and that of their subsidiaries and business partners (subcontractors and suppliers). Due Diligence investigations include the research and analysis of any element likely to generate ESG risk.
Designed as decision-making tools, our reports aim to provide strategic support in your risk management policy.
Our products are adapted to your needs: from brief reports, suitable for assessing a large volume of third parties, or for third parties with a lower risk profile, to in-depth investigations for third parties with a higher risk profile, such as strategic partners operating in sensitive environments.
The systematic use of due diligence therefore allows for the identification of non-compliance risks, and strengthens internal risk management systems under the Sapin II program, regardless of the operational area.
Tailor-made solutions for your third-party mapping
National authorities – both judicial and administrative – in charge of enforcing and monitoring anti-corruption regulations (US Department of Justice (DOJ), UK Serious Fraud Office (SFO), Agence Française Anticorruption (AFA), etc.) recommend adapting due diligence procedures to the level of risk posed by third parties, as established in the company’s risk mapping.
Thus, third parties presenting a low level of risk may be the subject of a simplified assessment process, based on more limited checks.
However, third parties identified as presenting a higher level of risk may be the subject of an in-depth analysis, combining open source research (OSINT) and field investigations (HUMINT) if necessary.
To ensure a structured follow-up process, companies are encouraged to set up a centralized database containing all assessed third parties, the results of verifications carried out and associated documentation.
Finally, in France, the AFA stresses the importance of a regular update of assessments, taking into account changes in business relationships and the risks associated with each third party.
Third party mapping yet to be carried out?
From screening to an in-depth assessment of your business relationships
In order to meet the expectations of the various national and international regulators, ADIT has developed a range of services catering to all risk levels:
- SCREENING (OSINT): Recommended for a rapid processing of a large volume of third parties, or for third parties with limited risk, this product uses databases to collect information relating to the identification of the third party (company name, address, etc..), its potential presence among sanctions and politically exposed persons (PEP) lists, and the potential existence of negative media citations.
- DUE DILIGENCE IN OPEN SOURCES (OSINT): recommended for third parties with a moderate risk level, this product gathers data via open source research techniques. It is complemented by a consultation of commercial registries and databases, as well as a systematic screening of international sanctions and PEP lists.
- IN-DEPTH DUE DILIGENCE (OSINT + HUMINT): recommended for high-risk third parties, this product uses the same approach as a Due Diligence in open sources, and is enriched by information collected by ADIT correspondents with local human sources.
ADIT offers several levels of investigation depending on the risk profile of a given third party, the required level of depth, time and budget constraints, as well as the provision of a secure third-party management platform facilitating the centralization and monitoring of third-party evaluation.
Screening
Search for PEP quotes, international sanctions lists and negative press
In-depth due diligence
Exhaustive open-source and field research by our local correspondents.
