Due diligence is defined as taking reasonable steps in order to ensure that an investment or business decision makes sense, that all legal requirements are met and that your interests are protected.
(noun)
- Doing extensive research on a home including a home inspection before buying it in order to make sure the house is a good investment is an example of due diligence.
- An investor researching a company before investing is an example of due diligence.
- A business considering a merger with another company, making sure that the company they are considering merging with is financially sound, is an example of due diligence.