Research Repository

Due diligence and complicity: A relationship in need of clarification

Michalowski, S (2011) 'Due diligence and complicity: A relationship in need of clarification.' In: UNSPECIFIED, (ed.) Human Rights Obligations of Business: Beyond the Corporate Responsibility to Respect? UNSPECIFIED, 218 - 242. ISBN 9781107036871

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In the context of corporate accountability, due diligence and complicity are two important concepts. The Merriam-Webster dictionary defines due diligence as ‘the care that a reasonable person exercises to avoid harm to other persons or their property’. In the business context, due diligence refers to the ‘research and analysis of a company or organization done in preparation for a business transaction’, or the ‘duty of a firm’s directors and officers to act prudently in evaluating associated risks in all transactions’. Complicity, on the other hand, is described as ‘association or participation in… a wrongful act’. Due diligence and complicity are thus different notions. This chapter will explore the various possible connections between these two concepts. Questions arising in this respect include, for example, whether the assessment and avoidance of the risk of complicity is part of a company’s due diligence responsibility. If so, can complicity liability arise even though the company acted with due diligence, but harm nevertheless occurs? And can due diligence responsibilities help to define the elements of complicity liability, with regard to both the question of which acts might result in liability of the company for third party wrongdoing, and which mental element is necessary in order to hold the corporation to account in such circumstances? Or does complicity liability define the content and scope of due diligence responsibilities?

Item Type: Book Section
Subjects: K Law > K Law (General)
Divisions: Faculty of Humanities > Law, School of
Depositing User: Jim Jamieson
Date Deposited: 23 Aug 2013 09:08
Last Modified: 31 Mar 2021 02:15

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