Corruption, sanctions, and political instability: these geopolitical events have far-reaching consequences for businesses. In this episode of Riskology, Dr. Ian Oxnevad and Chris Mason, joined by special guest Tom Fox, discuss the recent DOJ guidance on compliance priorities. They offer tips to help businesses identify and mitigate potential vulnerabilities that can affect a company’s bottom line and reputation and safeguard their operations from unforeseen geopolitical challenges.
Infortal Worldwide is a global risk management and investigations firm that specializes in helping businesses navigate complex risk landscapes. The company’s focus extends to various areas, including economics, politics, and geopolitical risk. By delving into these interconnected realms, Infortal Worldwide aims to provide clients with comprehensive insights that empower them to make informed decisions, especially in critical areas such as mergers and acquisitions, private equity investments, and other strategic moves.
You’ll hear Chris, Ian, and Tom discuss:
- American businesses need to understand the implications of their deals in Latin America, East Asia, and other regions, as legal and criminal risks are involved.
- In its latest announcements, the Department of Justice is emphasizing the importance of corporate compliance and is planning to look at corporate crime through the lens of national security.
- While it brings an additional level of scrutiny for business, compliance professionals welcome the announcement as it highlights the connection between international corruption and national security.
- The DOJ’s focus on national security means that corporate compliance groups may receive more resources and funding to enable them to understand the international geopolitical risk landscape and work on solving compliance issues before they happen.
- Recent scandals in South America highlight why companies with global supply chains, or those that are considering relocating, must be aware of the bribery and corruption risks present in different countries.
- Argentina has dealt with a number of issues over the past 150 years, and the country’s recent election has created uncertainty about the country’s economic future, so companies should take note and carefully assess the risks associated with doing business there.
- When the DOJ dedicates more resources to an area, they increase their enforcement in it, so companies need to know who they’re doing business with, how their supply chain functions, and where their products end up in the world.
- Traditional due diligence methods will not be enough in this new environment, so they’ll need their departments to develop new resiliency skills to mitigate risk and fallout when the geopolitical landscape changes.
- Managing geopolitical risk can seem daunting, but it’s much simpler than people think. Unlike the government, businesses have the ability to move quickly and course-correct more accurately, and the ability to do that will give companies an advantage over their competition on the world stage.
Key Quotes:
“The American private sector doesn’t seem to understand the implications in many cases of the deals that it does, whether it be in Latin America, in East Asia, elsewhere, that it doesn’t have to be a state-backed enterprise, that there are implications.” Dr. Ian Oxnevad
“In many ways, the United States is under permanent non-kinetic attack from Russia, from Middle Eastern countries, and probably China as well, in what we used to call the world’s competition, i.e. business. And because of those non-kinetic attacks… I think that directly affects the national security of the United States.” Tom Fox
“The landscape has changed… Safe jurisdictions and “safe companies,” may not be anymore. The map is different. The geography is different. Business geography is different.” Chris Mason
Resources:
Dr. Ian Oxnevad on LinkedIn
Chris Mason on LinkedIn
Tom Fox
