An Operational Due Diligence (ODD) assessment can be done on a broad range of asset management strategies, including hedge fund, infrastructure, private equity and traditional asset managers. The purpose is to challenge key aspects of the target investment managers and answer questions that matter most to clients.
Since the financial crisis, investors have increasingly come to recognize the need for effective operational due diligence processes alongside the evaluation of investment performance by managers. Effective operational management can create value as readily as inadequate processes can destroy it.
Frontiers in Finance explains how pension funds’ use of alternative investments adds complexity to fund governance and operational due diligence.