How can you structure a deal for maximum transparency?

1 Define the objectives

The first step in structuring a transparent deal is to define the objectives and expectations of all the parties involved. This means clarifying the rationale, the valuation, the timeline, the roles, and the responsibilities of each stakeholder. You should also establish clear communication channels and protocols, and agree on the key performance indicators and milestones that will measure the progress and success of the deal.

2 Choose the right advisors

The second step is to choose the right advisors who can help you navigate the deal process and provide independent and objective advice. You should look for advisors who have relevant experience, expertise, and reputation in your industry and market, and who can offer a comprehensive range of services, such as due diligence, valuation, negotiation, financing, legal, tax, and regulatory. You should also ensure that your advisors are aligned with your interests and goals, and that they disclose any potential conflicts of interest or ethical issues.

3 Conduct thorough due diligence

The third step is to conduct thorough due diligence on the target company or asset, as well as on the buyer or seller. Due diligence is the process of verifying and validating the information and assumptions that underpin the deal, and identifying and mitigating any risks or issues that may affect the value, quality, or feasibility of the transaction. You should use a data room to store and share confidential and sensitive documents, and to track and monitor the access and activity of the parties. You should also use a checklist to cover all the relevant aspects of the due diligence, such as financial, operational, legal, tax, environmental, social, and governance.

4 Negotiate fairly and openly

The fourth step is to negotiate fairly and openly with the other party or parties, and to avoid any hidden agendas or surprises. You should aim to create a win-win situation, where both sides can achieve their desired outcomes and benefits, and where any trade-offs or compromises are mutually acceptable and reasonable. You should also document and communicate any changes or updates in the deal terms or conditions, and to resolve any disputes or conflicts in a timely and respectful manner.

5 Use standard and simple contracts

The fifth step is to use standard and simple contracts that reflect the agreed deal terms and conditions, and that comply with the applicable laws and regulations. You should avoid using complex or ambiguous language, clauses, or provisions that may create confusion or misunderstanding, or that may expose you to legal or financial liabilities. You should also review and verify the accuracy and completeness of the contracts, and to seek legal advice if necessary.

6 Monitor and report the results

The sixth and final step is to monitor and report the results of the deal, and to ensure that the objectives and expectations are met or exceeded. You should use the key performance indicators and milestones that you agreed on in the first step, and to compare them with the actual performance and outcomes of the transaction. You should also provide regular and transparent feedback and updates to all the parties involved, and to address any issues or challenges that may arise during or after the deal.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?