PSERS Signs Due Diligence Mandate with IMDDA

Organization to add mergers and acquisitions class next year.

As it continues to expand into customized educational training, the Investment Management Due Diligence Association (IMDDA) announced the $53 billion Pennsylvania Public School Employees’ Retirement System (PSERS) has retained the group to conduct on-site, customized due diligence educational training programs.

“In the two years since we founded the IMDDA, we have attracted hundreds of professionals as members, worked with hundreds more through our international training seminars, and helped build understanding of and appreciation for the increasingly sophisticated role of due diligence behind today’s investment programs,” Andrew Borowiec, executive director of the IMDDA, said in a statement. “Today, we are thrilled to debut IMDDA’s first customized educational program for one of the world’s leading institutional allocators.”

The organization formed in 2015 with the goal to help institutions on a community level, but quickly found that many were having issues with due diligence.

“A lot of [institutions] were having problems hiring people. What they were finding was there was no pattern to learn the way people were doing due diligence,” Borowiec told CIO. “What they really wanted to do was build a standardization. The IMDDA was initially built to move toward benchmarking, setting up these practices, and setting up standards. We’re moving towards setting standards for these processes. That’s our ultimate goal.”

In addition to creating a community  in order to create certifications for due diligence, one of the elements being developed is a rigorous test to conforms with certification industry standards, including but not limited to the ISO 17024 Conformity Assessment and the American National Standards Institute (ANSI) accreditation requirements. Once the classes and demonstrations began, traction came swift.

“The idea was to put out ideas for best practices that we have gathered and what we found out was that there was an incredible need for it. The first classes we put on sold out immediately, ”Borowiec said.

Though these classes and creating these practices, PSERS reached out to the IMDAA requesting the organization perform an in-house operational due diligence (ODD) class in which its entire investment team was present. “That’s how we started with them,” said Borowiec. “It took several months going back and forth, and in the end we came up with a really customized class which worked really well [for them].”

“Due diligence is a vital function to our $53 billion investment portfolio and to the more than 500,000 individuals across Pennsylvania whom we serve,” Michael Benson, senior investment professional at PSERS, said in a statement. “The IMDDA is a strong partner to help our executives and staff better understand and embrace the concepts and practices of due diligence throughout our organization.”

In addition to new on-site ODD programs, such as classes for private equity and hedge funds, the IMDAA provides training seminars internationally, including a fundamentals and master classes. In 2018, the IMDDA will add a mergers and acquisitions due diligence class to their list of programs.

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