Tips for managing geopolitical risk
The evolving geopolitical landscape is shaping the regulatory landscape for professional and financial services firms in a number of ways. Events that are occurring between countries, with trade negotiations, with environmental issues and considerations, sanctions…all of these activities holistically come together with a need for firms to keep an eye on those and how they’re going to impact their policies and procedures internally.
Firms possibly have to put staff through external exams and accreditations to keep on top of updates to regulations, and that you’re monitoring the levels of skills and talent that your teams have. So the hiring process is extremely important, making sure that you have the right level of skill set for the the role and tasks that those individuals are expected to perform.
It can be very beneficial for firms to incorporate third party data into their internal and systems and ways of working. During the client onboarding process, a variety of data points are collected and it’s very important to validate those data points to make sure that the firm is comfortable that that data integrity has been checked.
The imposition of sanctions on Russia demonstrated to firms around the globe that they had compliance teams and employees conducting their ongoing daily activities and suddenly had to pivot to conduct very high volume significant levels of risk and sanctions and PEPs checks. And that puts a pressure on firms internally, where they’re having to now deal with ongoing incoming business together with those large volumes of checks collectively.
It’s very important that there is that ability to be able to be agile and to understand that those pressures are going continue to come as geopolitical events occur around the world.