We are pleased to announce the introduction of both ESG Due Diligence and Culture Due Diligence as part of our suite of pre-deal M&A services, helping our clients to optimize the value in their transactions.
ESG Due Diligence
ESG is currently a hot topic, with the landscape rapidly shifting and constant changes in client and regulatory demands. What was once market leading has now become market baseline and Asset Managers, Wealth Managers and Insurers are now under constant pressure to align with ESG expectations.
The objective of our new ESG Due Diligence offering is to identify any material ESG factors that may affect the long-term performance and valuation of a business and portfolio. Leveraging our team of ESG experts and industry specialists, we will provide a thorough assessment of how effectively ESG practices and processes are embedded in day-to-day activities. This will benefit our Asset Management, Wealth Management, Fintech and Insurance clients in three key ways:
- Identify material ESG risks that may impact future growth opportunities
- Review performance and trends of ESG product offerings and opportunity for growth
- Identify any material gaps from a reporting, monitoring or oversight perspective that require additional investment and subsequent adjustments to deal valuation.
"Identifying the key environmental, social and governance factors that influence pre-deal valuations and successful post-deal exit strategy is core to how we conduct our ESG Due Diligence services and an essential step of any M&A transaction. We leverage Alpha's 13 practices, including our dedicated ESG & Responsible Investment practice and our unparalleled industry insights to deliver pragmatic solutions to managing materially relevant opportunities and risks."Troy Mortimer, Director, ESG & Responsible Investment
The degree of cultural alignment between a Buyer and a Target will have a material impact on the ease (and therefore time and cost) of integration, retention of key staff and fulfilment of the acquirer’s business plan. A review of the two cultures during the due diligence process creates transparency and clarity, providing these key benefits:
- Early visibility of where stresses could appear, enabling risk mitigation planning
- Identify organisational traits or behaviours that either party could actively seek to adopt
- Identify the extent to which a change in the target’s culture could impact integration success (e.g., staff retention), thereby informing critical decisions about deal viability and ringfencing
"Executives rank the ability to manage culture as more important to M&A success than financial or strategic factors, but they also acknowledge that they tend to undermanage this critical aspect, only 10 or 20 percent said they used a similar level that they apply to financials. The likelihood of meeting cost and revenue synergy targets is substantially higher if you effectively manage culture during integration, hence one of the most important things in due diligence is looking at organizational culture at an early stage."Andrew Elko, Director, M&A
How Alpha FMC Can Help
Our strategy and M&A support bring market insights from SMEs dedicated to the sector. Whatever your reason for M&A activity, our entire team focuses on one industry helping clients diversify their product range, enter new geographies and obtain scale. We can support throughout the transaction, including vendor assistance, buy-side pre-deal diligence, taking control, post-deal integration and establishing strategies, to maximise value from the transaction. If you would like to learn more please get in touch here, or speak to one of our experts at the following contact addresses:
Rob Owen, Director (UK), M&A
Andrew Elko, Director (US), M&A