Consultancy’s chief risk officer Mike Peachey discusses cultural, regulatory and practical challenges at workshop
Charles Taylor Risk Consulting held a workshop looking at trading in developing nations, hosted by the firm’s chief risk officer, Mike Peachey.
Peachey looked at three high-level risks linked to the sector: regulatory risks, contractual risks and changing risk profiles.
He said there were cultural differences in understanding contractual obligations, which presented a challenge. “People have different understandings of their contractual obligations and the goalposts can move if the macro-economic situation changes,” he said. “You have to be careful about how you write contracts when you’re trading in developing nations.
“Look at currency transactions, for example: if these transactions are deemed to be speculative, rather than geared towards protecting a specific transaction, they may be illegal.”
Getting to grips with local insurance regulations and the extent to which businesses are able to buy adequate local insurance were other stumbling blocks he discussed.