In recent years, there has been an explosion of due diligence providers entering the market, some of which have little or no understanding why clients conduct due diligence on their partners. In many circumstances, due diligence reports produced by such inexperienced providers fail to meet client expectations, add value to their business or simply don’t address their challenges to help them make better decisions.
Currently, there is no shortage of due diligence providers, especially with private investigative firms stepping into the due diligence market. But the quality of the reports can vary drastically from one provider to another.
The Red Flag Group’s offerings and uniqueness in the marketplace, ensures that the integrity and compliance risks associated with your engagement with an outside party are shown in a way that makes it simple and easy to implement necessary next steps. At the end of the day, a company wants to know if it is advisable or not to do business with an outside party from its due diligence.
1. Talent: The Red Flag Group employs a mix employs of former in-house counsel, lawyers, risk and compliance officers, investigators, accountants, analysts, communication experts and trainers. The Red Flag Group’s global team is comprised of over 200 compliance experts speaking more than 50 languages across the world to conduct compliance assessments and offer solid resolutions to integrity and risk issues. Our team is well-equipped with access to thousands of data sources and constantly undergo training to ensure that they stay current with the newest developments in compliance.
2. Global presence: In order to meet our client’s expectations and provide a localised solution, our resources are spread throughout six regions: North America, Latin America, Europe, Middle East, Africa, Asia and Oceania. We have our headquarters in Hong Kong and key offices in strategic locations in Phoenix, London, Panama City, Dubai, Manila, Penang, Krakow, Singapore, Sydney, Madrid, Seoul, New York, San Francisco, Atlanta, Houston, Chicago, Philadelphia, Los Angeles and Detroit.
3. Advice and guidance: While raw data can be useful, it is easier and more meaningful for business unit heads and business decision-makers to quickly understand integrity, risk and compliance issues when they are presented in short and concise summaries. What sets The Red Flag Group apart is that we provide clear insights into what each risk means for our client’s business operations and advise whether there are steps that could be taken to remediate or mitigate the identified issue. We do this keeping in mind industry benchmarks, country risks, local laws and regulations such as the FCPA and UK Bribery Act.
4. Intelligent design: The Red Flag Group’s reports are not a typical text-based document that is usually filled with content that can be easily found in the open sources. Our reports are produced with relevant content based on research, audit and investigative experience in conducting over 1 million entities and individuals around the globe. As these reports can go beyond our client’s compliance and legal teams, we ensure that industry jargon and “legalese” language is used intelligently and where necessary. Each report is presented in a visually appealing layout to enable quicker and easier digestion of information. Additionally, we provide you a 360° summary on the front cover highlighting the overall risk summary, Business Risk Ratio and Peer Benchmarking. The Red Flag Group’s IntegraRating® is a proprietary 10-points risk rating system that is tailored to your risk tolerance; while Peer Benchmarking provides you a clear understanding on how your business partners are performing when compared to its peers in the same industry and country. The value to you is that IntegraRating®, Peer Benchmarking and Business Risk Ratio allows comparisons and supports an independent layer of interpretation against a standard. This gives you the best possibility of a benchmarking standard that exists in the market.
5. Easy to understand: As stated above, we keep our reports free from legalese. We believe that employees across all departments of a company should be aware of the various compliance and integrity risks that are posed by a potential new third party. With this in mind, The Red Flag Group has made sure that our reports can be easily digested by employees at all levels of an organization. Our reports are divided into five key sections namely, Risk Profile, Corporate Profile, Operations Profile, Management Profile and Appendix. The four main profiles are devoted to assessing, measuring, scoring and analysing data pertaining to that section, while the Appendix provides a detailed and transparent explanation of our methodology and risk validation.
6. Relationship mapping for complex structure: To make sense of any organisational structure, we provide an easy to understand diagram so that connections between entities and individuals can be easily understood visually. Our relationship mapping illustrates in a clean and concise manner the web of relevant relationships. This helps our clients avoid searching through outdated annual reports or other media sources to ascertain the connection between a target entity and related parties. In the case of private companies, it spares them the hassle of trying to call and/or ask around and then trying to decipher the connections on a corporate and individual level.
7. Risk Rating: To help clients manage risks more effectively, The Red Flag Group has developed a more tailored risk rating system that uses 10-points to assess direct and indirect risks by considering your risk tolerance, local insights, industry expertise, global practices and standards in the market. IntegraRating® is The Red Flag Group’s proprietary risk rating system which has replaced the generic traffic light system commonly used to assess and determine risks. The purpose of IntegraRating® is to provide a transparent system of gradation by which informed business decisions may be made – quickly and effectively. IntegraRating® has replaced the coloured traffic lights because each client’s risk appetite and exposure is different based on various factors including, but not limited to, the industry, country, markets and types of partners.
8. Questionnaire Analysis and Reference Verification: This layer adds another dimension to our research. These sections are best done by compliance, audit or legal professionals of which The Red Flag Group is fundamentally comprised. Information and analysis in these areas adds a deeper dimension to the discreet research. The research is more holistic in nature. At times, our clients may find inconsistencies due to outdated information provided by the third party and they also get the chance to view transcripts that will help them form their own judgement.
9. Third party screening: The Red Flag Group has its own screening database - IntegraWatch® | Compliance Screening. It consolidates business-critical information from publicly-available and subscription-based sources. Companies and individuals are screened against a variety of authoritative sources such as OFAC, UN Sanctions List, FBI, Interpol, Japanese Anti-Social Forces (ASF), UK Strategic Export Control Lists and IHS Markit. We pride ourselves with screening against our own proprietary database of ComplianceChallenged® individuals that have been curated from our years of conducting due diligence, audits and investigations. Our database also includes State Owned Entities, Politically Exposed People, adverse media related to 23 key Risk Areas, in addition to an exhaustive list of watchlists and blacklists.
10. An Executive Summary for quick decision: The first part of our reports contain an Executive Summary for our client’s convenience. Essential if a time-sensitive decision is required, we provide its IntegraRating®, Peer Benchmarking, Business Risk Ratio, as well as a succinct summary of the findings.