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Geopolitical Risks and Business Opportunities: Part 1- The Middle East 

I recently had the opportunity to visit with Dr. Ian Oxnevad, Director of Geopolitical Risk intelligence at Infortal Worldwide. This visit was for a podcast series, sponsored by Infortal Worldwide entitled Global Risk Review. Dr. Oxnevad is a seasoned expert in geopolitical risk intelligence, with a PhD in political science and a master’s degree in National Security Studies. His expertise, particularly in the Middle East and Africa region, has led him to identify numerous opportunities for US businesses, especially in the high-tech sector and water technology, following the Abraham Accords. Dr. Oxnevad acknowledges the potential risks, such as political tensions, inflationary pressures and threats to the dollar’s dominance. His insights are shaped by his extensive academic background and his role as the Director of Geopolitical Risk Intelligence for Infortal Worldwide.

Over this five-part blog post series we looked at the risk profile for US Companies doing business in the following geographic regions, the Middle East, Latin America, Russia and Ukraine, Africa and the Asia Pacific region. Over this five-part blog post series, we will review Dr. Oxnevad’s views in each one of these regions. We begin in this Part 1 by reviewing the business opportunities and risks in the Middle East.

The Middle East has undergone significant changes in recent years, particularly with the signing of the Abraham Accords in 2020. These accords have opened new opportunities for US businesses in the region, particularly in the United Arab Emirates (UAE) and Israel. However, along with these opportunities come certain risks and challenges that need to be carefully considered.

One of the key areas where US businesses can benefit from the Abraham Accords is in the high-tech sector. Both the UAE and Israel have highly advanced economies and a strong focus on technology. The normalization of relations between these countries has created opportunities for bilateral investments and partnerships. US companies looking to invest in Israel or the Gulf states can now do so with greater ease, as the need to keep economic relations separate has diminished.

Another sector that presents opportunities for US businesses is water technology. The UAE, in particular, heavily invests in Africa, where there is a high demand for water systems. Previously, geopolitical issues may have hindered collaboration between Emirati investors and US companies in providing water technology solutions in Africa. However, with the Abraham Accords, these hurdles have been removed, allowing for greater regional integration and technological cooperation.

While the Abraham Accords have opened up new avenues for US businesses, it is important to consider the potential risks and challenges that come with operating in the Middle East. One such risk is the potential for export sanctions violations, particularly in relation to Iran. US companies operating in Saudi Arabia, for example, need to be aware of the risks associated with conducting business with partners or buyers who may have ties to Iran. Thorough due diligence and risk assessments are crucial in mitigating these risks.

Additionally, the normalization of ties between Saudi Arabia and Iran, facilitated by China’s Belt and Road initiative, has implications for energy costs and potential inflationary pressures. If oil sales start getting denominated in currencies other than the US dollar, it could lead to higher energy costs and inflationary pressures. This could have a significant impact on US businesses operating in the region, as it may affect supply chains and purchasing power.

It is important for US businesses to stay informed about geopolitical developments and the potential impact on business opportunities and risks in the Middle East. Geopolitical risk intelligence and screening of partners and suppliers are essential in navigating the complex landscape of the region.

In conclusion, the Abraham Accords have created new opportunities for US businesses in the Middle East, particularly in the UAE and Israel. The high-tech sector and water technology are key areas where US companies can benefit from increased regional integration. However, it is crucial to consider the risks associated with export sanctions and potential inflationary pressures. Thorough due diligence, risk assessments, and staying informed about geopolitical developments are essential for US businesses looking to capitalize on the opportunities in the Middle East post-Abraham Accords.

I hope you will join us tomorrow when we explore Geopolitical Risks and Business Opportunities in Latin America.

You can check Dr. Oxnevad in the full five-part Riskology by Infortal podcast series here.

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FCPA Compliance Report

FCPA Compliance Report – Dottie Schindlinger on Corporate Governance and the Diligent Institute

Welcome to the award-winning FCPA Compliance Report, the longest-running podcast in compliance. In this episode, Tom Fox welcomes Dottie Schindlinger, Executive Director of the Diligent Institute.

The Diligent Institute, the governance research arm of Diligent Corporation, is on a mission to promote governance excellence by providing valuable resources and support to board members and senior leaders. Through research, thought leadership, podcasts, web shows, and certification programs, the institute addresses topics such as climate leadership, ESG, cyber risk, strategy, and AI ethics. Programs like the Next Gen Board Leaders Program and Director Network software facilitate peer-to-peer networking and board opportunities.

The Diligent Academy offers e-learning certification programs for directors, while the Diligent Forum provides a platform for directors to discuss specific themes with guest speakers. The conversation emphasizes the importance of empowering board members with the right information and insights to make informed decisions. It also discusses the changing role of directors in today’s business landscape, with a focus on digital transformation, cybersecurity, and customer satisfaction. The Diligent Institute aims to be a trusted resource for directors, providing valuable knowledge and understanding of their needs.

Key Highlights

  • Diligent Institute: Empowering Board Leaders
  • Diligent Academy and Forum
  • ESG Momentum
  • ESG Views and Director Confidence
  • The Changing Role of Directors

 Resources

Dottie Schindlinger on LinkedIn

The Diligent Institute

Tom Fox

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Report from IMPACT 2023

Report from IMPACT 2023: Larry Thompson on the Evolution of Compliance

ECI’s IMPACT 2023 was one of the leading compliance events in 2023. At this conference, Tom Fox, the Voice of Compliance, was able to visit with several of the speakers, exhibitors, participants, and one group of ethically-minded Girl Scout Troop. In this limited podcast series, Report from IMPACT 2023, Tom explores many of the most cutting-edge topics in ethics and compliance through short podcast episodes. Check out the full series of interviews. You will be enlightened and informed and come away with a fuller and more thorough understanding of the most cutting-edge topics in ethics and compliance. In this episode, Tom visits with Larry Thompson, former Deputy Attorney General and well-known compliance professional. Join Tom and Larry as they delve deeper into these topics on this episode of the Report from Impact 2023.

Larry Thompson is a seasoned professional in the field of compliance, with a career that spans several decades, starting as a young lawyer working with defense contractors in the late 1980s. Thompson’s unique insights on the evolution of compliance programs and ethical culture stem from his firsthand experience of the shift from a rules-based, legalistic approach to a values-based approach. He emphasizes the importance of companies having a common set of values that employees can embody and reflect in their actions, contributing to their long-term sustainability. Thompson also acknowledges the changing values and expectations of the new generation of employees, who prioritize working for companies that align with their own values and have a culture of integrity and purpose. These insights were shaped by his involvement in the establishment of the organizational Sentencing Guidelines in the early 1990s and his roles as a board member of various public companies and an active participant in the National Association of Corporate Directors.

 Highlights Include 

·      The evolution of compliance programs

·      The role of the DOJ in compliance

·      A new generation in the workforce

 Resources 

Larry Thompson

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31 Days to More Effective Compliance Programs

One Month to More Effective Written Standards: Day 4 – Code of Conduct: Structure and Format

Next comes the evolution of the structure and format of a best practices Code of Conduct. Initially, my experience with this is that they were written by lawyers, largely for lawyers. This included ‘thou shalts’ and ‘thou shalt nots’ liberally sprinkled throughout a lengthy written document. This was what is now referred to as Code 1.0. The compliance community then evolved to Code 2.0, where the writing was less turgid, moved to more employee-friendly language, and then somewhere along the line we started putting in hyperlinks, pictures, and videos.
There are two factors that a company should consider in the structure of a Code of Conduct. The first is to consider how your organization generally communicates, overlaid with the most effective way to communicate with the various stakeholders who will read and use it. These stakeholders can include such diverse groups as employees, shareholders and third parties on both the sales and supply side of your business. This may require multiple approaches.
Be sure to make your code readable. This is beyond simply eliminating legalese. It is writing English at a grade level that is sufficient for your employee population. It may be that an eighth-grade language level is appropriate for your workforce. However, if you have a population consisting primarily of professionals, translating it into the appropriate languages it might be appropriate to aim for a higher level of language. Finally, you do not have to say the same thing, in multiple different ways.

Three key takeaways:

  1. Companies have moved past having a Code of Conduct written by lawyers for lawyers to a fully interactive code for all employees.
  2. Consider how information is distributed at your organization as a basis for communication in your Code of Conduct.
  3. Your Code of Conduct must be readable, in both in English and native language for non-English speaking employees.

For more information, check out The Compliance Handbook, 4th edition, here.

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31 Days to More Effective Compliance Programs

One Month to More Effective Written Standards: Day 3 – The Code of Conduct

What is the value of having a Code of Conduct? In its early days, a Code of Conduct tended to be lawyer-written and lawyer-driven to wave in the regulator’s face during an enforcement action as proof of overall ethical behavior. Is such a legalistic code effective? Is a Code of Conduct more than simply your company’s internal law? What should be the goal in creating your company’s Code of Conduct?

Indeed violation of your Code of Conduct can form the basis of a domestic FCPA enforcement action. In an enforcement action involving United Airlines, Inc., a breach of the Code of Conduct by the Company CEO was determined to be an FCPA internal controls violation. It involved a clear quid pro quo benefit paid out by United to David Samson, the former Chairman of the Board of Directors of the Port Authority of New York and New Jersey. This public government entity has authority over, among other things, United’s operations at the company’s huge east coast hub in Newark, NJ.
Your Code of Conduct should be tailored to your company’s culture, industry, and corporate identity. It should provide a mechanism by which employees trying to do the right thing in the compliance and business ethics arena can do so. The Code of Conduct can be used for employee review and evaluation. It should certainly be invoked if there is a violation. Your company’s disciplinary procedures must be stated in the Code. These would include all forms of disciplines, up to and including dismissal, for serious violations of the Code. Further, your company’s Code should emphasize it will comply with all applicable laws and regulations wherever it does business. The code must be written in plain English and translated into other languages so all applicable persons can understand it.

Three key takeaways:

1  A Code of Conduct is a foundational document in any compliance regime.
2  The substance of your Code of Conduct should be tailored to the company’s culture, industry, and corporate identity.
3  “Document, Document, and Document” your training and communication efforts regarding your Code of Conduct.

For more information, check out The Compliance Handbook, 4th edition, here.

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The ESG Report

The ESG Report – Tommy Linstroth on Building for a Sustainable Future: The Role of ESG in Construction

The ESG Report podcast is hosted by Tom Fox. Looking for innovative solutions to tackle climate change? Look no further than The ESG Report! In this episode, Tom speaks with Tommy Linstroth founder and CEO at Green Badger about the role and opportunity for the construction industry in the ESG arena.

The podcast episode discusses the increasing importance of incorporating ESG practices in the construction industry. Tommy Linstroth, an expert in the field, emphasizes the need for companies to embrace ESG to remain competitive and attract talent. Linstroth highlights the demand for ESG compliance from customers, regulators, and financiers. He emphasizes the need for companies to measure and integrate various ESG factors, breaking down silos within organizations. The conversation also emphasizes the role of safety in ESG and the potential benefits of ESG in improving efficiency, talent attraction, and transparency. Overall, the episode underscores the significance of ESG integration in the construction industry and the importance of a strategic approach to its implementation.

Key Highlights

·       The Intersection of Construction and ESG

·       ESG Integration in Construction Industry

·       ESG and Business Efficiency

·       Getting Started with ESG

·       ESG Implementation and Continuous Improvement

Resources

Tommy Linstroth on LinkedIn

Green Badger

Tom Fox 

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Operationalizing Compliance With 10 Questions for HR

Operationalizing compliance is the crucial step in creating an effective compliance program within an organization. It involves cascading compliance goals to all levels of the organization and fostering a culture of compliance. This process requires clarity and comparability of goals, focusing on high-risk areas first, and gradually expanding initiatives. Ethical business conduct should be a top priority, with HR playing a key role in attracting and developing talent. Continuous improvement and performance tracking are also crucial for identifying gaps and developing key compliance indicators.

Root cause analysis is a key process in identifying the reasons behind compliance failures and implementing effective solutions. It involves understanding what allowed the compliance issue to arise, rather than simply assigning blame, and addressing the core issues to prevent future compliance failures. It goes beyond assigning blame and focuses on finding solutions to prevent future failures. Understanding the root cause allows organizations to address the core issues and implement effective measures to ensure compliance.

To operationalize compliance effectively, organizations need to consider several key factors. One of the first factors is the interconnectedness of targets. Compliance goals should be cascaded down to individual workers, ensuring that everyone understands their role in achieving compliance objectives. While tone at the top is important, it is equally crucial to establish an appropriate tone in the middle and at the bottom of the organization.

Clarity and comparability of goals is another important factor. Compliance targets should be clearly communicated and understood by all employees. Complex goals can lead to confusion and hinder the operationalization process. Focusing on high-risk areas first and gradually expanding initiatives can help manage risks effectively and ensure a systematic approach to compliance.

The role of HR in operationalizing compliance cannot be overstated. HR should take the lead in showing that attracting and developing talent who will engage in ethical business conduct is a top priority. By creating the appropriate mindset of doing business the right way throughout the organization, HR can contribute to the successful operationalization of compliance.

Continuous improvement and performance tracking are essential for identifying gaps in the compliance program. Monitoring compliance programs in real-time and reacting quickly to remediate them is crucial. Auditing and monitoring should work in tandem to uncover and evaluate risks. Key compliance indicators, such as hotline or helpline reports, can provide valuable insights into the effectiveness of the compliance program.

While operationalizing compliance is essential, organizations must also consider the impact on employees. Talent acquisition and retention is a critical business function. Retaining top employees who engage in ethical business conduct is crucial for the long-term success of the compliance program. By promoting and rewarding employees who adhere to the code of conduct, organizations can create a culture of compliance and operationalize it fully.

Balancing these factors can be challenging. Organizations must weigh the tradeoffs involved in cascading compliance goals, clarifying goals, and addressing high-risk areas. They must also consider the challenges associated with monitoring and auditing, as well as the importance of root cause analysis and employee retention.

What are the 10 questions you should ask to test, monitor and improve these issues?

  1. How are compliance goals cascaded down to individual workers?
  2. Does anyone complain that your compliance targets are too complex?
  3. How do you deal with repeated compliance failures in a specific business segment or compliance program area?
  4. How does your company show that attracting and developing talent who will engage in ethical business conduct is a top priority?
  5. How long is compliance underperforming tolerated?
  6. What makes it distinctive to work at your company?
  7. How do compliance programs that are not working typically get exposed and remediated?
  8. What key compliance indicators do you use for compliance tracking?
  9. For a given compliance problem, how do you identify the root cause?
  10. What are you doing to retain your top employees from the compliance perspective?

In conclusion, operationalizing compliance is a key component of an effective compliance program. By considering the interconnectedness of targets, clarity and comparability of goals, the role of HR, continuous improvement and performance tracking, root cause analysis, and employee retention, organizations can successfully operationalize compliance and prevent future compliance failures. It is crucial to strike a balance between these factors and consider the impact on employees when making decisions about operationalizing compliance and root cause analysis.

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Into the Chair - Tales from Chief Compliance Officers

Into The Chair, Tales from Chief Compliance Officers: The Journey of Maria D’Avanzo

Welcome to the latest edition of the Compliance Podcast Network: Into the Chair: Tales from Chief Compliance Officers, which details the journey to and in the role of a Chief Compliance Officer. How does one come to sit in the CCO chair? What skills does a CCO need to navigate the compliance waters in any company successfully? What are some of the top challenges CCOs have faced and how did they meet them? These questions and many others will be explored in this new podcast series. Into the Chair: Tales from Chief Compliance Officers is a COMPLY podcast hosted by Tom Fox and is a production of the Compliance Podcast Network. In this inaugural episode, I visit with Maria D’Avanzo.

Maria D’Avanzo is a seasoned professional in the legal and compliance field, with a career that has spanned from litigation to estate work to compliance. Maria’s perspective on adaptability and continuous learning in legal and compliance roles is rooted in her own career trajectory, which has seen her successfully transition from being a litigator to opening her own law practice, and eventually becoming a compliance officer. She believes the key to success in these roles is the willingness to learn new skills and take on new challenges, even outside one’s comfort zone.

Maria also underscores the importance of transferable skills such as analytical and research abilities, critical thinking, and the capacity for advocacy and persuasion, which she honed as a trial lawyer and have been instrumental in her compliance career. Join Tom Fox and Maria D’Avanzo in this episode of the Into the Chair podcast as they delve deeper into the importance of adaptability and continuous learning in legal and compliance roles.

Key Highlights:

·      Maria’s transformation into a compliance officer

·      Navigating the Legal Field: Learning and Advocacy

·      Advocacy skills and the value of compliance

·      Navigating Compliance Challenges in Regulated and Non-Regulated Corporate Sectors

Resources:

Maria D’Avanzo on LinkedIn

COMPLY

Tom Fox

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Everything Compliance - Shout Outs and Rants

Everything Compliance – Episode 123, Shout Outs and Rants – The Spanish Kiss Edition

Welcome to the only roundtable podcast in compliance as we celebrate our second century of shows. In this episode, we have the quartet of Jay Rosen, Jonathan Armstrong, Matt Kelly and Karen Woody, with Tom Fox hosting on this episode of our fan fav Shout Outs and Rants section.

1. Matt Kelly rants about the US Federal Courts not allowing television cameras and says we need the Trump trials televised in federal courts.

2. Karen Woody shouts out to the Barbie movie.

3. Tom Fox shouts out to Megan Rapinoe for great professional career and her social activism while a member of the USWNT.

4. Jay Rosen shouts out SOCAR, the South Orange County Compliance and Ethics Roundtable.

5. Jonathan Armstrong shouts out Sgt. Graham Saville lost his life helping a person in distress.

The members of the Everything Compliance are:

•       Jay Rosen– Jay is Vice President, Business Development Corporate Monitoring at Affiliated Monitors. Rosen can be reached at JRosen@affiliatedmonitors.com

•       Karen Woody – One of the top academic experts on the SEC. Woody can be reached at kwoody@wlu.edu

•       Matt Kelly – Founder and CEO of Radical Compliance. Kelly can be reached at mkelly@radicalcompliance.com

•       Jonathan Armstrong –is our UK colleague, who is an experienced data privacy/data protection lawyer with Cordery in London. Armstrong can be reached at jonathan.armstrong@corderycompliance.com

•       Jonathan Marks can be reached at jtmarks@gmail.com.

•       Special Guest Kristy Grant-Hart is the founder of Spark Consulting.

The host and producer, ranter of Everything Compliance is Tom Fox the Voice of Compliance. He can be reached at tfox@tfoxlaw.com. Everything Compliance is a part of the Compliance Podcast Network.

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10 For 10

10 For 10: Top Compliance Stories For the Week Ending September 2, 2023

Welcome to 10 For 10, the podcast which brings you the week’s Top 10 compliance stories in one podcast each week. Tom Fox, the Voice of Compliance brings to you, the compliance professional, the compliance stories you need to be aware of to end your busy week. Sit back, and in 10 minutes hear about the stories every compliance professional should be aware of from the prior week. Every Saturday, 10 For 10 highlights the most important news, insights, and analysis for the compliance professional, all curated by the Voice of Compliance, Tom Fox. Get your weekly filling of compliance stories with 10 for 10, a podcast produced by the Compliance Podcast Network.

·       280K Euros seized from MEP son’s apartment. (TVP World)

·       Businesses need Chinese predictability. (NYT)

·       Gensler unleased regulatory blitz. (FT)

·       Goldman Sanctioned for ephemeral messaging compliance failures. (WSJ)

·       China crackdowns rips through health care industry corruption. (FT)

·       Switzerland unveils money-laundering crackdown. (FT)

·       3M settles FCPA action. (WSJ)

·       Imprisoned Kazakh tycoon may be released. (RFE/RL)

·       Do you really need incentives to operate safely? (Reuters)

You can check out the Daily Compliance News for four curated compliance and ethics related stories each day, here.

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