Directors and executive officers are ultimately responsible for corporate compliance with national and international regulators encountered in the course of their global sourcing and marketing endeavors.
Directors and executive officers are ultimately responsible for corporate compliance with national and international regulators encountered in the course of their global sourcing and marketing endeavours.
Most companies tend to compartmentalize their trade activities into import and export functions, with separate groups working independently with outsourced providers of financial, legal, trade, and customs services.
This can create a “silo” affect that, while effective for the day-to-day execution of trade-related activities, reduces or even eliminates visibility to the areas of the enterprise impacted upstream or downstream. There can be significant consequences that will inevitably find their way into the corporate boardroom and executive offices.
Our intention is to build the case for why an integrated global trade strategy makes commercial sense, and is an essential component of a solid corporate approach to minimizing regulatory risks that may threaten the enterprise, and maximizing opportunities that may benefit it.
Link to download the white paper: A Case for an Integrated Trade Compliance Strategy
Video Link of Reynold Martens providing a summary of an Integrated Trade Compliance Strategy
Reprinted with Permission from Lauren Meling
Trade Compliance Blog from software firm Management Dynamics
This September, American Shipper hosted a webinar covering a topic that many are interested in – but there are few resources are available to address the problem. I’m not saying it was groundbreaking, but for once we were able to openly discuss what c-level executives need to hear to make trade compliance a priority.
If you missed it, you can still watch the recorded webinar online at anytime and download the slides for reference. The webinar was full of great tips to ensure success in raising the profile of your trade compliance department and securing the ever-elusive budget to implement enhancements. Here are four key takeaways that were discussed in the webinar.
What CEO’s Want and Don’t Want
The first step is to think like an executive, talk like an executive, and walk like an executive. Getting into the mindset of your CEO is critical to be able to explain the importance of trade compliance in relation to his or her priorities.
If you conducted a survey of CEO’s top concerns, I would bet you would not see “Trade Compliance” on that list even once. Why? It’s just not on their radar when they’re trying to please shareholders, raise profits, and make headlines. That’s why it’s up to you to explain how trade compliance helps accomplish those goals, while preventing negative results like sales to bad guys and bad press.
How do global companies succeed?
Just like everyone else succeeds – they have a plan in place! To create a strategic GTM roadmap, first identify key systems objectives, such as integrating multiple systems onto one centralized platform, ensuring import and export compliance, and minimizing business continuity risk.
Then, benchmark and establish improvement objectives. A great (and free) source of benchmarks is the new AberdeenGroup Report “Global Trade Management: Strategies for Mastering Trade Compliance and Supply Chain Complexity.”
Finally, it takes 5 steps to create a roadmap:
- Develop consistent reference data
- Establish baseline visibility across the organization
- Achieve global control
- Continuously improve through business intelligence data
- Reduce future costs by planning new initiatives.
The deep effects of global trade on your company’s bottom line
One of the most surprising facts revealed during the webinar is that you may be the highest ranking person in your company who “gets” global trade. If you are a director or VP, there probably isn’t a single person above you that can manage the company’s trade activities, and even analysts and administrators are not far behind.
Leverage your knowledge to communicate the importance of global trade on your company’s profitability. Don’t emphasize penalties, however, as scare tactics don’t always work to get your way. You ultimately want your trade compliance department to be seen as a strategic initiative to cut costs in the long run rather than prevent potential fines.
Speaking to CEO’s in their language
Putting yourself in you CEO’s shoes, analyze what your corporate history has been, what the CEO has prioritized in the past, and the potential agendas of the others in the boardroom. C-level executives aren’t familiar with all the complex regulations and hundreds of acronyms we use every day when talking about trade compliance, so “translate” the key benefits of an improved trade compliance program into terms everyone understands, and no one can turn down.
For example, stating that you could “decrease the cycle clearance time” is not as impactful to an executive as being able to state, “We will achieve cost savings through decreased clearance cycle time by enhancing our trade compliance program.” The key is stating the end result: Cost savings, improved customer retention, or higher margins.
View the Recording: “Bringing Trade Compliance into the Boardroom”
Our expert panel discusses best strategies for compliance professionals to gain executive-level cooperation and sponsorship of new compliance initiatives. This webinar, hosted by American Shipper magazine, and presented by Management Dynamics and BPE, is a must-see to help you get the attention your trade compliance department deserves from your C-level executives.
Thanks to Lauren and Management Dynamics for allowing us to reprint this articleRick Riess, President, GHY International shares interesting material he has reviewed and feels it’s worth your time to read it.
Kewill : 2010 Parcel Shipping & GTM Benchmark Study
Our President, Richard Riess, and 4th generation great grandson of George Henry Young, founder of GHY International, shares things he found interesting. He found this Executive White Paper on shipping interesting in terms of their shipping considerations and recommendations. You can find the study here.
GHY and Kewill do not have any current business relationship.
GHY and GTM do not have any business relationship.
GHY provides this content for your review only, in no way does this constitute professional advise.
Our underlying rationale for this perspective of needing an Integrated Trade Compliance Strategy is based on 6 tenets
Last post we shared a very high level overview of why we believe that an integrated trade compliance strategy is the right approach in today’s business environment. Last weeks posting was about the skeleton of an idea, today we add some vital content for you to consider and comment on.
Our underlying rationale for this perspective is based on 6 tenets:
1. Supply chains are more internationally integrated and diverse than ever before, creating a complex new mix of origins, currencies, manufacturing locations, and markets.
2. Regulators in the US, Canada, and globally are harmonizing their efforts to enforce international trade rules in pursuit of revenue, and to suppress terrorist threats, therefore increasing the risk of detection.
Effective management of international trade will only increase in importance as Canadian and US companies refocus their efforts on growth and expansion to take advantage of global opportunities.
3. It is the regulator’s responsibility to write the rules of trade, communicate expectations and consequences clearly to the trading community, and enforce compliance with those rules.
4. It is the corporation’s legal responsibility to be informed, compliant with the regulations, and prepared for the inevitability of verification audits or enforcement actions.
5. Directors, executives, and senior managers need to be discerning, and match their investment in risk mitigation to the potential magnitude of severity and commercial impact to the enterprise.
6. An intelligent trade risk mitigation strategy identifies desired outcomes, and proactively anticipates regulatory intersections at each stage of the business cycle from product development to contract fulfillment.
What do you think? Did we miss one? Which one can you relate to?
We have already stated that we will share details behind our belief that an Integrated Trade Compliance Strategy is not only desirable but necessary in today’s world with Global supply Chain’s. Don’t take our word for it; “Trade regulation and compliance has become sobering business. The events of September 11, 2001 and the corporate corruption [...]
We have already stated that we will share details behind our belief that an Integrated Trade Compliance Strategy is not only desirable but necessary in today’s world with Global supply Chain’s.
Don’t take our word for it;
“Trade regulation and compliance has become sobering business. The events of September 11, 2001 and the corporate corruption scandals of Enron and Worldcom changed forever the world of international trade. The U.S. government has responded aggressively by adding more complexity and more scrutiny to international trading standards and programs. It is also developing technology solutions and a National Targeting Center to increase its oversight and enforcement capability. In addition, the Sarbanes-Oxley Act of 2002 impose strict requirements on executives, has potent enforcement powers and a strong emphasis on internal controls.” (Matthew Gersper, Randell Carr, Creating a Competitive Advantage in Global Trade, Global Data Mining, 2006)
“In a nutshell, rapid globalization, supply chain complexity, and intensifying regulatory vigilance translates into escalating trade compliance risk for internationally active corporations and their leadership teams at the Director and Executive levels”, says Reynold W. Martens, Executive Vice President, GHY International and author of the white paper, The Case for an Integrated Trade Compliance Strategy.
