On 7 October, XapienXchange London brought together leaders working in risk, compliance, law, financial services, corporates, higher education, and non-profit sectors for a day of fascinating debate and discussion about how technology is transforming the due diligence industry.

Here are five insights that stood out.

1. AI makes risk-based due diligence possible at scale

Due diligence teams have long faced a trade-off between coverage and depth. Researching every third party thoroughly wasn’t feasible, so many teams applied the same standard of checks across the board. That approach lacked proportionality: it wasn’t comprehensive enough for high-risk subjects, but was more than medium-risk subjects needed.

AI removes that trade-off. Organisations can now investigate far more counterparties, in far greater depth, than was previously possible.

But just because organisations can conduct enhanced due diligence on everyone, should they?

This was one of the liveliest debates of the day, and it challenged the assumption that more research produces better outcomes. Exhaustive research on every counterparty can overwhelm teams with information and pull attention away from the risks that demand action. A low-risk relationship may need only a focused assessment, while a higher-risk one may warrant deeper investigation or ongoing monitoring.

The real opportunity is that AI enables a greater level of customisation than was previously possible. Instead of choosing between broad coverage and appropriate depth, organisations can do both: extend due diligence across far more relationships while matching the level of scrutiny to the risk each one presents.

2. Compliance activity is not compliance effectiveness

The opening keynote highlighted the gap between compliance activity and its impact, pointing to the millions of suspicious activity reports financial institutions submit each year and the limited capacity of enforcement agencies to review them. Reporting volumes say little about how effectively financial crime is being prevented.

The same issue can happen in any organisation conducting due diligence. Checks completed, alerts reviewed, or reports produced are measures of activity, not effectiveness.

A more useful measure is whether the work improves the speed and quality of organisational decisions. Effective due diligence identifies concerns early enough to act, before resources are sunk into deals that cannot close. It also helps the organisation build new relationships without exceeding risk appetite.

3. Due diligence can be a business enabler

Compliance teams are often brought into transactions late. An adverse finding can force organisations to pause negotiations, change a deal, or walk away after months of discussions, potentially souring future relationships with partners.

Faster research makes it possible to investigate prospective relationships earlier, enabling companies to address concerns, introduce safeguards, or pursue alternatives before committing significant resources.

The “Transformation stories” segment of the conference showed how this can work, from identifying risks before pursuing potential partnerships to restructuring a transaction in response to an ownership concern.

4. Risk changes continuously, so due diligence should keep pace

A counterparty’s risk profile can change after onboarding. New sanctions, changes in ownership, emerging allegations, or a shift in the business relationship can all make an earlier assessment outdated.

Continuous, event-driven due diligence allows organisations to respond to these developments as they arise, rather than waiting for the next scheduled review.

5. New technology creates opportunities to redesign workflows

Xapien can integrate into existing workflows, but it also makes it possible to redesign them entirely. With comprehensive research available in minutes, organisations can assess more relationships, bring due diligence into commercial decisions earlier, and change how teams use risk intelligence.

At XapienXchange London, we heard from clients who have done this. One speaker described conducting due diligence during deal shortlisting, so commercial teams can address concerns before negotiations progress.

Another speaker described how their team has an onboarding workflow that automatically assesses a new client’s legal structure. Then, the workflow xapiens all of the third parties identified, giving analysts an immediate view of potential sanctions, PEP exposure, and adverse media across the entire network surrounding the new client.

Both of these examples show how Xapien can radically transform the wider due diligence process, expanding what teams once thought was possible.