 However, a separate “Investment Due Diligence” (IDD) exercise is often carried out by or on behalf of (potential) investors to consider investment functions.In fact, historically, it can be said that it has been more common for an IDD to be performed than for an ODD to be performed, despite strong academic arguments and empirical evidence that overall risk (i.e., investment risk and operational risk) is best capable of being understood and mitigated where both an IDD and an ODD are performed.The historical position is somewhat odd given the prevalence of operational risk failures in, for example, hedge fund scandals and closures over the years.