Report Specifications

1. Individuals (Directors, Promoters and Shareholders)
Due diligence on the key individuals in the third party will also be undertaken. The purpose of conducting due diligence on the directors is to identify major red flags and reputational issues associated with the key promoters and shareholder of the third party.

1.1 Personal profiling
A personal profiling of the individual directors, promoters and shareholders in the company will be undertaken to identify possible red flags against them. The portfolio of the key individuals will include their personal background, their educational qualification and their political leanings and whether they assert any influence in the regional political sphere.

1.2 Reputation
The investigation will include extensive primary and discreet searches with the individuals associated with third party in the past who could provide an objective appraisal of the key individuals. The possibility of finding a red flag through discreet enquiries is often high.

1.3 Credit check
The creditworthiness of the key individuals will be assessed through the records found through the CIBIL (Credit Information Bureau Limited) database. The report will help in determining the ongoing financial state of each individual; the number of loans each individual has taken and whether they were able to dispose of them on time or they have accumulated debts which might in turn be affecting the ongoing business of the third party.

1.4 Civil litigation check
Civil litigation charges could act as a major red flag. Both online database sources like Manupatra and records in the local jurisdictions of the third party will be scrutinized to find civil litigation charges, if any, against the key individuals.

1.5 Criminal history check
Criminal cases filed against the key individuals, both in the local courts and the Supreme Court, will be checked thoroughly. It is also important that all the known aliases of the individuals are found so that the searches will include, in the databases and through local jurisdictional searches, all the aliases of the individuals.

1.6 Global compliance database check
Global database checks will be conducted on the directors using databases including World Check, Global Database Check and LexisNexis among others. Other databases to include:

• World Compliance Political Exposed Person (PEP)
• List Office of Foreign Assets Control (OFAC)

1.7 Intensive media check
An intensive online media searches to also be conducted against the individual names. An extensive monitoring of the individual’s social media presence will be undertaken. This will include monitoring of the interactions about the individuals taking place on multiple social media platforms like Twitter, Facebook, etc. Information with regard to individual’s online reputation will be identified and analysed for any possible red flags.

2. Company profile strategy, mission and reputation

The company profiling strategy will include assessment of the third party from its standpoint with the client. The geographical location of the vendors/suppliers might make them more vulnerable to incidences of corruption. Thus the investigation on a third party emphasizes on their regional location. In addition, it will also be critical to examine what role the third party will play in the everyday transactions of the client’s business. The criticality of the due diligence process will vary if the third party will be performing the services on the behalf of the client or if it will act as a representative of the client in official capacity in any of the business functions. It is also important to investigate the longevity of the company by doing an analysis on how long it has remained in the business and the feedback it has received from its existing clients. If the third party will come in frequent contact with the government bodies, a thorough investigation on the third party will become even more critical.

2.1 Financial status through review of information
A thorough due diligence of the third party’s finances will also be undertaken. This will be done through the extensive analysis of the company’s documents present in the Registrar of Companies (Ministry of Corporate Affairs) and on other proprietary databases.

2.2 Customer references preferably from similar product / service line
Feedback from the existing customers of the third party will also be undertaken. Feedback from the end customers or the intermediaries to the third party dealing with similar nature of product or services vis-à-vis the client’s will be subject to a thorough analysis.

2.3 Intensive social media intelligence service
An extensive monitoring of the third party’s social media presence will be undertaken. This will include monitoring of the interactions about the third party taking place on multiple social media platforms. Information with regard to company’s online reputation will be identified and analysed for any possible red flags.

2.4 Site visit
Physical visit to the third party’s office will also be undertaken to ascertain its authenticity and staff strength.

2.5 Civil litigation check
Civil litigation charges could act as a major red flag. Both online database sources like Manupatra and records in the local jurisdictions of the third party will be scrutinized to find civil litigation charges, if any, against the third party.

2.6 Global compliance database check
Global database checks will be conducted on third party using databases including World Check, Global Database Check and LexisNexis among others.

Scope

The first step for an effective third-party due diligence process is in the clear understanding of an organisation’s linkages with third parties and determination of who among the third parties should be considered under the “scope” and thus subject to risk-based due diligence.

01  Defining third parties
It is critical that the third-party due diligence includes the third parties contracted in both sales and supply chain channels. Whereas anecdotes may suggest that third parties – e.g. agents and distributors – engaged in the sales activities of an
organisation may be more susceptible to bribery coercions, it does not discount the vulnerability of the suppliers. Here we will define what persons should be included under the scope of third-party due diligence. Please note that this list is not exhaustive and some information may overlap with each other. Each organisation is advised to develop its own list of the third parties with whom it is engaged. annual revenue generation and level of oversight.

02 Joint venture partner
An individual or an organisation that has entered into an agreement with another individual or an organisation (with a possible involvement of other parties) to create a new business entity and manage its resources.

03 Consortium partner
An individual or a cooperative pooling its resources along with another organisation (and possibly with the involvement of multiple parties) for achieving a common goal. A consortium is distinct in that each party maintains its separate legal status.

04 Agent
An individual or an entity authorised to act for, or in the lieu of, or to otherwise represent, another organisation to further the latter’s business interests. Agents may be further subcategorised into the following:

• Sales agents (those needed to win a contract)
• Process agents (for e.g. visa permits agents)

05 Advisor & other intermediaries
An individual or an organisation availing service or expert advice by representing an organisation towards another person, business and/or government official. These include legal, tax, financial advisor or consultants and lobbyists.

06 Contractor and subcontractor
A contractor is a non-controlled individual or an organisation that avails goods or services to an organisation under a contract. A subcontractor is the hired hand of the contractor who performs specific tasks and is guided by his employer.

07 Supplier/vendor
An individual or business entity that supplies raw materials or services to another organisation

08  Service provider
An individual or an organisation providing another organisation with major functional support. For e.g. communications, supply and logistics, storage, processing, etc.

09 Distributor
An individual or an organisation that purchases products from another organisation in bulk, stores them in their own warehouse and then resells the products to the retailers or to the end-users directly.

10  Customer
The receiver of the end-product, service or idea which they purchase from an
organisation. They can be categorised into the following:
A) A customer could be an intermediate dealer who purchases goods for reselling purpose
B) The end customer who receives the final product or service and consumes them directly