Third Party Risk Presentation Deck-C5 2016

Do you really know who you’re doing business with?

THIRD PARTY RISK SOLUTIONS

Trusted data and technology to detect, assess and minimize supplier, partner and distributor risks.

THIRD PARTY RISK APPROACH PRODUCTS WHY THOMSON REUTERS?

WHAT ARE THE THIRD PARTY RISKS?Is your organization aware of all the areas of risk they might face when dealing with third parties? Here is an overview of the main areas of risk and regulation you need to be compliant with.

Environmental Crime

Slavery and Human Rights Abuse

Financial Crime and Sanctions

Bribery and Corruption

Conflict Minerals

Ultimate BeneficialOwnership

THIRD PARTY RISK

THIRD PARTY RISK APPROACH PRODUCTS WHY THOMSON REUTERS?THIRD PARTY RISK

BRIBERY AND CORRUPTION


UK BRIBERY ACT 2010

CANADIAN CORRUPTION OF FOREIGN PUBLIC OFFICIALS ACT

(CFPOA) 1998

US FOREIGN CORRUPT

PRACTICES ACT 1977

2015Multinational

conglomerate fined $19M for FCPA

violations

2015Board members of an

international sports governing body are part

of an ongoing bribery and corruptioninvestigation BRIBERY

AND CORRUPTIONThe practice of offering

something, usually money, or the abuse of a position in

order to gain an illicit advantage or benefits.

THIRD PARTY RISK


FINANCIAL CRIME AND SANCTIONS


Multinational financial services company fined over $5m for sanctions

breach

EU FOURTH MONEY LAUNDERING DIRECTIVE

2015

US BANK SECRECY ACT/ANTI-MONEY

LAUNDERING1970

Multinational conglomerate

fined over $200M for sanctions breach

FINANCIAL CRIME AND SANCTIONS

Any offense involving fraud or dishonesty, misconduct in, or

misuse of information relating to a financial market, or handling the

proceeds of crime. A trade sanction is a penalty imposed by one nation

on to one or more other nations.

THIRD PARTY RISK


SLAVERY AND HUMAN RIGHTS ABUSE


FMCG Conglomerate used

child labor

UK MODERN SLAVERY ACT

2015

CALIFORNIA TRANSPARENCY IN THE SUPPLY

CHAIN ACT 2010

Internationalsportswear

manufacturer caught usingsweatshopslave labor

SLAVERY AND HUMAN RIGHTS

ABUSESlavery includes bonded labor, child slavery, forced labor or trafficking.

Human rights abuse is the contravention of the basic freedoms

entitled to humans.

THIRD PARTY RISK


ENVIRONMENTAL CRIME


2013Not for profit

organization led a boycott against companies that pollute heavily

EU TIMBER REGULATION (EUTR)

AUSTRALIA ILLEGAL LOGGING

PROHIBITION ACT 2012

Slave labor is being used in the fishing

industry in Thailand

ENVIRONMENTAL CRIME

Endangering wildlife, pollution, illegal timber, carbon trade and

water management crime.

THIRD PARTY RISK


CONFLICT MINERALS


OECD DD GUIDANCE

EUPROPOSED REGULATION

2014

US DODD–FRANK

ACT 2010

CONFLICT MINERALS

Tin, tungsten, tantalum or gold sourced from the Democratic

Republic of Congo or neighboring countries as they have a high risk of

financing militia groups in the region.

THIRD PARTY RISK

Consumer products such as mobile

phones and laptops may contain conflict

minerals.


ULTIMATE BENEFICIAL OWNERSHIP


Ultimate Beneficial Ownership

identification is key to complying with

narrative sanctions

2016‘Panama Papers’ reveal that some companies’

ultimate beneficial owners had ties to illicit

activity

EU FOURTH MONEY LAUNDERING

DIRECTIVE

US G8 ACTION PLAN STATEMENT

ULTIMATE BENEFICIALOWNERSHIP

The natural person(s) who ultimately owns or controls the

majority share of a business and any financial risk they could be

involved in.

THIRD PARTY RISK


• Operational disruptions• Lack of risk-based

approach

• Legal costs • Consumer boycotts• Lack of investors• Brand remediation costs

• Fines from regulators • Reputational damage

DO YOU FACE THE FOLLOWING CHALLENGES?So now we have looked at the risks, these are the challenges businesses face as a result of these risks and not staying on top of them.

• Ever-increasing and changing regulations

• Proof of due diligence/compliance programs

• Immediate response and contingency plan

Regulatorynon-compliance

• Unethical practices damages an organization’s reputation

• Growing importance of corporate social responsibility

• Employee retention and satisfaction

Reputational damage

• Enforcement of fines and/or sanctions due to non-compliance

• Civil litigation lawsuits

• NGO investigations

Legal action

• Limited budget and resources

• Lack of a scalable third party risk program

• Siloed, fragmented data and systems

• Lack of expertise and knowledge

Operational inefficiency

Potential consequences:

THIRD PARTY RISK


KEY CUSTOMER NEEDS

What does arisk-based approach

look like?

What risks are associated with a shifting geopolitical

landscape?

What hidden complexities can a global supply chain

contain?

Can I expect accurate and trusted news

and data in a timely manner?

How can I educate staff and third parties

on best practice?

How will this be incorporated with current platforms and preferred

partners?

VISIBILITYIDENTIFYUNDERSTAND

TIMELY DATA EDUCATEINTEGRATE

APPROACH


A RISK-BASED APPROACH TO THIRD PARTY RISKHere are the steps your organization needs to take to mitigate exposure to third party risk. We understand the process of risk management and what each step entails. That’s why we are able to support you, every step of the way.

Retrieve/collect information on

third parties, e.g. questionnaire

management of third party

onboarding and performance.

Supplier onboarding*

Determine any geopolitical, social and economic

risks associatedwith third parties.

Understandingthe risks

Conduct initial due diligence by screening third parties against

business relationship risk.

Screening third parties against risks

Detailed background

checks on any heightened risk individuals or

entities to further protect against regulatory and

reputational damage.

Further due diligence required

Continuously monitor third

parties for any change in status and risk levels.

Ongoing monitoring

Report (auditable trail) on third party

risk management program for regulatory purposes.

Ongoing reporting (audit trail)

Roll out compliance

training program to internal staff or third parties.

Train and educateY/N

Decision to onboard or reject third party

* We work with preferred partners to provide this.

APPROACH


ABOUT US

At Thomson Reuters, our Third Party Risk solutions help you detect, assess and minimize potential risks associated with your suppliers, distributors and partners, and regularly monitor them for any change in status.

Our solutions combine intelligence, technology and human expertise to help your organization identify the different risks you might face in a complex global environment, from bribery and corruption to sanctions and modern-day slavery.

With Thomson Reuters you get answers you can trust to increase your efficiency and growth in your business and supply chain.

WHY THOMSON REUTERS?

Francesca BocciaE: [email protected]: +393428022942

mailto:[email protected]

Third Party Risk Presentation Deck-C5 2016

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Transcript of Third Party Risk Presentation Deck-C5 2016