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A Due Diligence Policy sets out the steps an organization takes to evaluate risks and ensure compliance before making important business decisions. In Danish companies, these policies typically align with the Danish Companies Act (Selskabsloven) and outline specific checks for mergers, acquisitions, and major investments.

The policy guides teams through essential verification processes, from financial audits to legal compliance checks. It helps Danish businesses meet their obligations under EU regulations and local laws while protecting against fraud, money laundering, and reputational damage. Well-designed policies include clear roles, timelines, and reporting requirements that make thorough vetting a natural part of business operations.

Use a Due Diligence Policy when your organization plans significant business moves that need thorough vetting - especially mergers, acquisitions, or major partnerships. Danish companies particularly need these policies before investing in foreign businesses or when dealing with complex regulatory requirements under EU and Danish law.

The policy becomes essential during time-sensitive deals where you need to balance speed with careful risk assessment. It guides your team through critical checks for financial stability, legal compliance, and potential liabilities. Having this framework ready helps avoid costly mistakes and ensures you meet Danish Financial Supervisory Authority requirements for corporate governance and risk management.

• Financial Due Diligence: Focuses on verifying financial records, market position, and growth potential - commonly used in Danish M&A transactions
• Legal Due Diligence: Covers regulatory compliance, contracts, and intellectual property rights under Danish and EU law
• Environmental Due Diligence: Examines environmental impacts and compliance with Danish green regulations
• Technical Due Diligence: Evaluates IT systems, infrastructure, and operational capabilities
• HR Due Diligence: Reviews employment contracts, union agreements, and workforce-related obligations under Danish labor law

• Corporate Legal Teams: Lead the development and updating of Due Diligence Policies, ensuring alignment with Danish corporate law
• Board of Directors: Approve and oversee policy implementation, taking ultimate responsibility for risk management
• Compliance Officers: Monitor and enforce policy requirements across Danish business operations
• External Advisors: Provide specialized input on financial, legal, and technical aspects of due diligence processes
• Department Managers: Execute policy requirements and report findings during investment or acquisition activities
• Investment Teams: Apply the policy during transaction evaluations and strategic partnerships

• Define Scope: Map out which business activities need due diligence coverage under Danish law
• Review Legal Framework: Identify relevant Danish and EU regulations affecting your industry sector
• Set Clear Roles: Establish who conducts reviews, approves findings, and maintains documentation
• Risk Assessment: List specific risks your organization faces in mergers, acquisitions, or partnerships
• Documentation Standards: Create templates for gathering and storing due diligence findings
• Timeline Guidelines: Set realistic deadlines for each due diligence phase
• Compliance Checkpoints: Include verification steps aligned with Danish Financial Supervisory Authority requirements

• Policy Purpose: Clear statement of objectives and scope under Danish corporate governance requirements
• Legal Framework: References to relevant Danish legislation and EU regulations
• Review Procedures: Detailed steps for conducting financial, legal, and operational assessments
• Risk Categories: Specific areas requiring examination under Danish Financial Supervisory Authority guidelines
• Documentation Requirements: Standards for record-keeping and reporting aligned with Danish data protection laws
• Responsibility Matrix: Clear assignment of roles and accountability
• Compliance Thresholds: Decision criteria and approval processes for different transaction types
• Review Timeline: Maximum periods for completing each due diligence phase

A Due Diligence Policy often gets confused with a Due Diligence Checklist, but they serve distinct purposes in Danish business operations. While both support thorough business evaluations, their roles and applications differ significantly.

• Scope and Purpose: A policy sets the overarching framework and principles for conducting due diligence, while a checklist is a practical tool listing specific items to verify
• Legal Standing: The policy carries formal authority within the organization and helps demonstrate compliance with Danish regulatory requirements, whereas the checklist serves as a supporting operational document
• Longevity: Policies remain relatively stable and require board approval for changes, while checklists can be readily adapted for specific transactions or industry needs
• Implementation: The policy guides strategic decision-making and risk management approaches, while the checklist ensures consistent execution of the policy's requirements