Risks uncovered in due diligence processes often contain the seeds of opportunities, but the traditional approach doesn’t follow through to explore what those seeds could mean for future growth. Say, for instance, a diligence process finds that an investor’s 20 percent year-on-year compound growth expectation is threatened by bottlenecks in a project’s manufacturing capacity or sales pipeline. An opportunities-focused approach might ask how the seller’s existing supply chain and sales relationships could mitigate and even outweigh that risk. From risks to opportunities
It’s an approach that can demonstrate to investors that a company has a clear path to managing its risks and maximising opportunities. For instance, a business might vertically integrate or form joint ventures with partners to de-risk or tackle upcoming challenges — thereby shifting the conversation from “slow down” or “stop” to “how to stimulate growth.” To capture a more complete picture for investors by widening the aperture to include opportunities as well as risks, use due diligence to probe for:
Market expansion What regulatory trends or adjacent channels could be leveraged to expand a project’s market potential? How might existing partnerships be used to open up access to new sources of demand?
could look to differentiate itself through sustainability metrics that attract customers with decarbonisation or related goals. Despite political changes, the market for decarbonised solutions remains strong due to several prominent companies pushing ahead with their targets. Coca-Cola³, AB InBev⁴ and Unilever⁵, for example, all have net-zero targets in place, which is driving their supply chains to invest in and develop net-zero products and services. for identifying and resolving technical problems. Still, businesses should look for advisors who bring in other professionals, such as economists and investment bankers, to determine how commercial, financial and market factors could impact value accretion. It’s important not to treat the opportunity focus as an “add-on” late in the day. Instead, it should be integrated into the diligence process right from the start because it will inform and enhance the entirety of the discussion. It’s about reframing due diligence from a static checklist of problems to a primary strategic tool for unlocking growth. Not to mention, if the transaction goes through, it serves as a blueprint for success.
While setting formal ESG targets is currently facing a “greenwashing” backlash, identifying growth opportunities through sustainable practices can be a central element of this type of diligence process. In fact, many fund managers operate within a compliance mandate, adhering to guidelines such as the Equator Principles¹ or Article 6² of the Paris Agreement, which obligates them to report sustainability risks. A project might deliver local social or environmental benefits that would strengthen its long-term viability, or a company
Supply chain strengthening
What are the prospects for forging strategic supplier relationships to diminish long-term supply risks? Are there opportunities to recycle or reinforce some components?
Making the shift
To emphasise opportunity while still acknowledging risk, investors need to demand more from their advisors during the due diligence phase. That means pushing them to analyse the big picture, rather than getting stuck in the weeds of technical risks. Flagging technical risks is step one, but it’s the advisors’ job to then place those risks in context and weigh them against long-term value creation. And consider which risks will have a material impact on the business’s costs and cashflows. An opportunities-focused approach also benefits from calling on a broader, more interdisciplinary team than due diligence usually entails. Engineers may be crucial
Technology boost Is there an innovation roadmap that could allow the project to operate and scale most effectively and efficiently?
Management networking
Does senior leadership have relationships they can harness to expand opportunities and drive growth? Do they have the strategic skills to make the most of opportunities? Is the organisation’s structure adequate and set up to succeed and support growth?
Demand signals and product-market fit How well does the project align with emerging industry trends? What benchmarking or global competitive information can be sourced for assessing ‘lessons learnt’?
References 1. The Equator Principles. The Equator Principles. April 2025. https://equator-principles.com/about-the-equator-principles/ 2. United Nations Framework Convention on Climate Change (UNFCCC). “Article 6 of the Paris Agreement.” United Nations Climate Change. 2025. https://unfccc.int/process-and-meetings/the-paris-agreement/article6 3. Coca-Cola. n.d. “Climate Action: Coca-Cola.” Coca-Cola. https://www.coca-cola.com/xe/en/sustainability/climate-action 4. AB InBev. n.d. “Net Zero Executive Summary.” AB InBev. https://www.ab-inbev.com/assets/pdfs/Net%20Zero%20Executive%20Summary_FINAL%2012pm.pdf 5. Unilever PLC. “Our Climate Transition Action Plan.” June 3, 2025. Unilever. https://www.unilever.com/sustainability/climate/our-climate-transition-action-plan/
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