As a Mergers and Acquisitions Advisor, if you call Healthcare Transactions Group (HTG) to discuss the possibility of engaging us to sell your business, and HTG does not sign a Confidentiality Agreement, does HTG nonetheless have an implied obligation to maintain this information as confidential whether hire HTG or not?
As a Mergers and Acquisitions (M&A) Advisor, even if we do not sign a Confidentiality or Non-Disclosure Agreement and are not officially hired by the business for sale, we believe we have an implied obligation to maintain confidentiality.
Our ideas that govern this situation are the following:
- Industry Norms and Expectations
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- Professional Standards: M&A advisors typically have a professional duty to maintain confidentiality as part of their unique role, even if no formal agreement is signed. This is based on industry norms and ethical standards that apply to those in advisory roles.
- Fiduciary Duty: In some quarters, M&A advisors may be seen as having a fiduciary duty to act in the best interests of the business owners, which includes protecting sensitive information, even without a signed agreement between the parties. In this sense, we hold HTG to a higher professional standard, regardless of whether or not you engage us.
- Implied Duty of Confidentiality
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- Confidential Nature of Information: If the information we learn about the business for sale is confidential and shared with us in a private or business-related context, we believe we have an implied duty to maintain confidentiality, regardless of whether a formal Confidentiality Agreement is signed. The information shared in this context is typically and often immediately recognized as inherently confidential; accordingly, there is a reasonable expectation that business transactions should not involve public disclosure of sensitive details unless explicitly allowed.
- Relationship Context: Even if you don’t hire for potential representation, if you talk to us, you can and should be assured that the information you share will remain confidential.
- Ethical Responsibility: As an M&A advisor, we maintain confidentiality, a fundamental ethical principle, and best practice.
If you don’t want to hire us and we don’t sign a Confidentiality Agreement, we hold an implied duty to maintain confidentiality as a professional M&A advisor. This duty is rooted in professional ethics, industry norms, and maintaining our good name for business integrity, which we have earned over twenty-five years as an M&A Advisor. Generally, to avoid this issue, we have a customized Confidentiality Agreement for your consideration of Healthcare Transactions Group as your potential M&A Advisor.