Compliance in Global Mobility: Part 1 of 2
Tracy Figliola of HSBC reviews risk and compliance within Global Mobility and reflects upon why these factors are fast becoming a key growing challenge for mobility teams.
The past few years have seen a visible shift in the perception of Global Mobility in business, moving from a commodity purely managing logistics to a technical profession in its own right, managing major risk and delivering benefits to the organisation if recognised accordingly.
The implications of Global Mobility not delivering can be far reaching; from failing to deliver a good quality experience and adequate protection for the organisation’s talent resource, to impacting the businesses in which the assignees operate in, by either delayed assignments, impacted assignments or distraction from the core business drivers and goals, or to reputational risk and potentially direct costs through incurred penalties.
Why is international compliance a growth area?
The economic downturn - is serving to put pressure on both countries and companies alike to invest in growth markets, generate revenue and cut expenditure in order to survive or maintain market share.
As a consequence there is a combination of contracting and expanding markets and an environment where organisations have to react to threats and opportunities immediately before the opportunity is lost. National priorities are competing against international priorities and there can be conflicts between local, regional and global considerations. There is a strong focus on cost reduction or containment, and a tangible fear of decline and stagnation and a hunger for revenue. All this serves to raise the requirement for Global Mobility to be timely, proactive, efficient, cost-effective and compliant.
Global connectivity - the world is getting smaller. Culturally we are more open to travel, and migration is set to double by 2050. The global awareness of everyone continues to grow along with the accessibility of best practices, laws and regulations. Governments and country regulatory bodies are more connected than ever before and are openly sharing information both with their counterparts in other countries, and across related departments. Tax authorities coordinate with immigration authorities; accountancy firms managing key data or linking with third party providers to access source data. Legal and compliance functions are working together to guide and give instruction on national regulations and on cross-border data compliance.
The commercial concept of globalisation - has been a trend for many years. Many international organisations are on a programme to globalise their environment, infrastructure and operations in some form or other. It is becoming a necessity for most organisations to expand into the export market. For most organisations to survive and be more cost-efficient they either have to explore international markets or international operations or have an international supply chain. Many international companies have embraced the concept of the shared service model to centrally deliver operational processes for the benefit of the global organisation. The end result is that organisations are becoming more spread geographically, with matrix operations, infrastructures and management structures. Although this trend may have commercial logic it does pose greater risks and compliance demands on the organisation. Cross-border compliance is no longer between six key developed locations but is now potentially between fifty plus locations (depending on the size of your organisation) from developed to emerging, emerging to develop and emerging to emerging market combinations.
Technology - is an enabler to build global connectivity, allowing data and information sharing to take place immediately and round the clock. Changes in regulations or sharing of best practices can be achieved with relative ease. But this also sets an expectation that:
- All corporations will know and understand the regulatory framework in which they operate in.
- All corporations will be able to have access to any data on their employees and their operations immediately.
- All corporations have the reporting functionality to deliver any request for data and to be able to audit and cross reference that data with ease to ensure 100% accuracy.
International compliance demands that organisations can and will be compliant or risk having severe penalties applied. Building the capacity and skilled capability in an organisation to meet the growing requirements to operate internationally and be compliant in all areas takes time and is a risk in itself.
About this article: This is the first of a two part blog from Tracy Figliola. The concluding piece will be available on Thursday 11th September.
About the author: Tracy Figliola, HSBC
Tracy Figliola is Global Head of Global Mobility at HSBC Group, responsible for the strategy and operational delivery of the Global Mobility global platform, executing the Group's Global Mobility Programme across all business entities in the Bank and a Centre of Excellence for the delivery of Global Mobility within the Group. The HSBC Group has in excess of 1,700 international assignees, across 71 countries managed through three regional hubs covering APAC, EMEA, AMERICAS and a central operations team based in India.
IMAGE RIGHTS: Kalyan Chakravarthy (2011). Half what? Available at: https://flic.kr/p/9jkkW5. License here.