Statutory Complaince and Due dillegence services

Vendor Due Diligence: A prospective investment for the future – a check to reduce risk in labour law compliance

In a highly competitive market where businesses operate, to acquire the right vendor for the organization often the process of Vendor due diligence rests primitively to eliminate any possible risk in partnering with a potential vendor. It could either be a buyer-side due diligence or a seller-side due diligence, before partnering with a client. 

Why is vendor due diligence assessment necessary?

To understand the organization’s legal stability, reputation, threats or any other issues that’s related to an entity’s compliance, the vendor due-diligence becomes an imperative tool. The comprehensive process varies according to the business operation modules and aligns the frequency of the risk management. 

What are the objectives?

Having a successful vendor associate is a necessity rather than a want in today’s business world. The due diligence process gives a better understanding of all types of legal risks the companies face. Also, carrying out a set of exhaustive checks will lead it through better decisions. Let’s try and understand the objectives of a vendor due diligence process in detail – 

  • Reducing disruption in the business process
  • Helping all involved parties in executing the partnership ventures with speed and efficiency
  • Providing with certainty, the compliance health of the target vendor and the nature of its adherence to laws.
  • Continents monitoring of risks by implementing statutory health & cyber risk monitoring tools to receive alerts based on any negative incident or trends that could lead to a change in the risk associated with a vendor.

Vendor due diligence checklist – What is covered?

Vendors form part of one of the chief sources for running a business smoothly and also successfully; all companies are constantly planning to have long-term strategic alliances to make it more beneficial to both the parties. To understand and eliminate the obligations in third party tie ups, vendor due diligence process requires information to evaluate the vendors. 

Company Information

  •  Constitution
  • Reliable References
  • Incorporation Documents 
  • Registrations under all applicable statutes
  • Key stakeholders and beneficiaries
Compliance Health

  • Periodic filing of returns with statutory authorities
  • Appropriate renewal / restoration of licences & registrations
  • Tax documents 
  • Compensation Structure 
  • Prompt remittances of vendor statutory dues, especially labour dues
  • Major non-compliance issues / complaints in the past
Reputational Risk 

  • Reports from government agencies
  • Litigation history of company and employees, if any
  • Checking the target company against global sanctions, and watch lists
Online Security Risk 

  • Penetration testing
  • Online security policies
  • Compliances such as ISO 270001
  • History of data breaches and online frauds 
Operational Risks 

  • Business continuity plans
  • Code of conduct handbooks
  • Employee lawsuits and attrition rates

How Versutus helps ? 

When there are enormous hidden factors to run any business with utmost compliance, it becomes a mandate that we go for an alliance with an entity after a comprehensive research and analysis of the vendor background and present stature. Vendor due diligence is a long- term ongoing process, and looking at it as an investment alone shall accelerate business processes, saving from unwarranted threats to compliance reputations and cost effectiveness. Moreover, Versutus shall flag-off the quiescent & hidden issues that brings a control over vendor relationships. 

Versutus

Versutus is a Pan India compliance and legal service provider, working with more than 20+ prestigious organizations across India ranging from automobile to logistics sectors, with expertise people onboard and a decade of experience in handling complex situations and management, we help your organization to steer right and help you support your growth.

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