The focus on environmental, social and governance (ESG) as a means of creating sustainable value is on the rise. Institutional investors are increasingly considering nonfinancial performance, such as ESG issues, when making investment decisions. The three factors of ESG and the corresponding investment-related sustainability issues are: Environmental – Is the company environmentally responsible? Does the…

Part 3 of a 3-part Series Operational Due Diligence (“ODD”) has grown in importance significantly for institutional investors looking to invest in funds. Prior to 2008, ODD played an insignificant role compared to investment due diligence (“IDD”) when it came to investors making their final investment decisions. Because of the 2008 financial crisis and the…

Part 2 of a 3-part series In Part 1 of our Due Diligence Series, Managing Vendor Risks: Implementing an Effective Third-Party Due Diligence Program, we discussed the various aspects of an effective third-party vendor due diligence program. In this article, we focus on the keys to conducting adequate due diligence of sub-advisors to satisfy heightened fiduciary…

Part 1 of a 3-part series Financial services firms are increasingly contracting with third-party service providers to perform activities related to their business functions and regulatory responsibilities. Acknowledging this trend, regulators have made it clear that outsourcing an activity or function does not relieve firms of their ultimate responsibility for compliance with all applicable securities…

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