MBA Research

Trend #4: Increased Government Regulation

Business Trend

In our ongoing conversations with the business community*, we asked business executives to identify business trends impacting the workplace. Next up is increased government regulation


Workplace Implications

Government expansion has led to rising costs of doing business, accelerating velocity of change, and increasing levels of conflict between competing states and the national government. Businesses are concerned about the risk of loss from a more polarized, more heavily regulated environment.

Domain-specific rules (e.g., Dodd Frank and BASEL III for banking) have increased. So, too, have the more general rules that impact all businesses. In the finance industry, the trend is driving an increase in compliance resources, training, and process-improvement initiatives.

Increased government regulation is impacting multinational businesses as prosecution of both U.S. and foreign-based multinationals increases. This is due to Foreign Corrupt Practices Act (FCPA), Anti-Money Laundering (AML), and Office of Foreign Asset and Control (OFAC). In coordination with the Department of Justice, the Securities and Exchange Commission Enforcement Division has created a specialized unit to further enhance its enforcement of the FCPA. Cases are expected to increase even more based on the whistleblower provisions of the Dodd-Frank Wall Street Reform Act. A similar level of prosecution has begun to emerge around privacy and data protection.


Classroom Implications

The major takeaway is that compliance is a risk for every company. Students need to understand the specific requirements of their desired career pathway and industry. They also need to understand how both of these (industry and career) impact job expectations and responsibilities. Students need to understand regulations from a global perspective, not just from a U.S. perspective (e.g. global quality standards, global chemical standards, global tax laws, etc.).

 

*Finance Executive Advisory Panel, Columbus, OH, May 21, 2013
*Marketing Executive Advisory Panel, Dublin, OH, May 22, 2013
*Management and Administration Executive Panel, Dublin, OH, May 23, 2013