Tackle changing rules with a constructive game plan
Increased regulation is a reality no market player can avoid or afford to ignore. And meeting this challenge with an open mind and proactive approach does not have to be costly and counterproductive.
'Businesses should take a more proactive stance and embrace this challenge as an opportunity for upgrading themselves,' said Paul Kan Man-lok, chairman of Champion Technology Holdings.
Champion is a global supplier of IT solutions for a wide range of applications.
'We use our compliance exercises for internal re-engineering. By improving our systems and processes we strive to raise operational efficiency and productivity, and reduce our reliance on manual handling.'
The benefits from such a positive approach help counter the increasing pressure of compliance, which can undermine morale and create internal suspicion by subjecting staff conduct and behaviour to scrutiny, potentially impairing a company's competitive edge and profitability, and increasing the burden of responsibility on chief executives and chief financial officers.
'Maintaining a balance between compliance and staying competitive is a tall order. But because compliance is a global trend and we have no choice but to oblige, we believe the earlier we comply the better,' he said.
Because Champion had a wide range of IT solutions, it faced regulatory governance on different fronts, Mr Kan said.
'One of the most far-reaching aspects encountered by an international company is alignment with the ever-evolving international accounting standards whose impairment provisions would have an impact on our financial results beyond our control,' he said.
'We also have to watch our step carefully under disclosure requirements. Where significant business deals are involved, we're obliged to make an announcement even if we feel the stage is not ripe for making anything public.
'Therefore, to meet the changing dynamics of market conditions and regulatory requirements we need, as an organisation, well-thought-out strategies and to stay prudent at all times.'
Regulations applied in a well balanced manner would help, especially evolving sectors such as the internet, but overdoing regulations would cause significant harm, Mr Kan said.
'There's a fine line between what is appropriate and what is excessive supervision and monitoring, like in the case of the internet. The same goes with any emerging industry or sector, and the authorities should avoid killing the goose before it can hatch an egg,' he said.
Mr Kan said that corporations should be allowed discretionary power and judgment which tallied with their unique requirements in compliance.
Champion, he said, would challenge evolving regulatory provisions that it felt were impracticable or excessive.
