Why multiplying compliance risks demand a calculated strategy
Karen E. Gray - Senior Entity Due Diligence and Monitoring Specialist, LexisNexis
In the past, compliance risk was a top-of-mind issue among select industries: regulators appeared to have banking and financial services, along with energy and extractives, under a constant microscope. But as supply chains expanded across oceans and continents, and countries legislated regulations to address bribery and corruption, terrorist financing and human trafficking, compliance risk grew for all types of organizations. Now the pressure is on you. Is your current due diligence and monitoring process up to the challenge?
The Link between Third-Party Spending & Risk: Recently, a Deloitte survey of 480 procurement leaders from 36 different countries, garnered responses from a wide array of industries. While the energy industry elicited the second-highest number of responses, manufacturing beat it by more than 30 per cent, with consumer business and healthcare and life sciences coming in close behind in third and fourth places. Banking and financial services came in last among the top five. Interestingly, compliance risk awareness – and willingness to participate in the survey – coincides with the amount of third-party spend by industry. With its wide-ranging supply chains, the manufacturing industry’s third-party spend is approximately $455 billion. Banking and financial services, in contrast, have a third-party spend hovering at $132 billion.
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