It is a given that both company concerns will use their right to due diligence before entering into a new arrangement with another entity. Meaning that the Entity will gain reasonable assurance that the party with which it is interacting follows Ethical, Regulatory, and Legislative rules in its operations. In regular commercial practice, this entails doing a thorough examination of the potential third party's assets and liabilities so that they may be accurately assessed.

This is done for a variety of reasons, including ensuring that the third party is not participating in any illegal actions. When a business enters into a contract or agreement with another party, it is expected that it will conduct due diligence. This means that the company will ensure that the party with which it seeks to do business adheres to all legal, social, and ethical requirements. In practice, this entails undertaking a thorough assessment of the potential third party in order to determine its assets and liabilities. This approach will assess not only the partnership's commercial potential, but also any potential dangers that may be associated with it. A distributor in a high-risk country, for example, may allow a company to expand into new territory while simultaneously exposing it to the risk of corruption.