Emerging international compliance: Policy implications of a money laundering case

By conducting a qualitative single case study, we have depicted in this study a suspected case of international money laundering in Finland, and described its consequences in terms of policy changes. The case allowed us to investigate how new anti-money laundering policies emerge over time and thus advance knowledge relevant to formulating effective international business policies. Building on institutional heterogeneity and the co-evolutionary nature of change, we have proposed a new framework depicting emerging international compliance in order to promote understanding of this complex, yet dynamic phenomenon. The literature repeatedly highlights the role of formal policies in mitigating international money laundering, however, we have paid additional attention to unethical business practices and the moral aspect recognised to be important in terms of curbing the problem. This is particularly relevant for MNCs, as they can aid institutional change internationally by spreading ‘company best practices’. We also present the managerial and policy implications of solving moral problems related to money laundering from the perspective of governments, society and organisations.

Translating Innovation into Performance: Understanding Role of the Board

Innovation enables firms to face increasing competition in the global environment, but there is variation in innovation investments across firms due to the inherent uncertainty involved in innovative activities. The strategic role of board, therefore, becomes crucial in overseeing innovation decisions. This study, hence, examines whether the relation between R&D investment and firm’s performance would vary based on the board characteristics of the company. It empirically explores this interrelationship in publicly listed Indian companies, by assessing the moderation effect of board using fixed effect regression analysis and conditional effects on a panel data of 9,031 firm years across twelve years. Board size, board meetings, proportion of women director and board leadership are found to negatively moderate the relationship between innovation and financial performance (ROE), however none of them moderates the relation between innovation and firm value (Tobin’s Q). It signifies that though board characteristics play an important role in relationship between innovation and ROE, investors fail to recognise it. Companies should focus on creating the right kind of board, investors must appreciate board’s influence in the success of R&D investments without being driven by mere compliance. Policy makers should deliberate upon the desirability of present structure of stringent laws.

Retrospective review of nicotine exposures in California from 2012 to 2018 and analysis of the impacts of e-cigarette regulations

ObjectivesTo review the association between US e-cigarette regulations and the number of reported nicotine exposures, and identify higher-risk productsDesignRetrospective review of de-identified medical records.SettingCaliforniaParticipantsCases reported to California Poison Control System in 2012–2018.Primary and secondary outcome measuresSuspected nicotine toxicity; route of exposure and product characteristics.ResultsWe examined 5277 exposures, of which 3033 involved combustible cigarettes, 1489 involved e-cigarettes and 818 involved other substances (ie, chewing tobacco, nicotine patches, nicotine lozenges, hookah, etc). Implementation of the Child Nicotine Poisoning Prevention Act of 2015 was not significantly associated with reduced exposures. Exposures for e-cigarettes increased significantly after the 2017 Food and Drug Administration Compliance Policy (p=0.003, coefficient (coeff)=0.61). Total exposures for all tobacco and nicotine products also increased significantly after the policy change (p=0.01, coeff=1.26). Nicotine exposure outcomes classified as being of minor and moderate severity increased significantly after implementation of the 2017 Compliance Policy (p=0.004, coeff=0.54 and p=0.002, coeff=0.56, respectively). Ingestion was the most common route of exposure (87.7%), followed by inhalation (8.1%), dermal (6.5%), ocular (2.1%) and other (intranasal, rectal, sublingual and unknown) routes (0.2%); some cases reported multiple routes of exposure. Exposure cases involving e-cigarettes fell into three problem categories: product design, labelling and the appeal of flavours.ConclusionsOur analysis found that despite previous studies suggesting that the Child Nicotine Poisoning Prevention Act appeared to have reduced exposures for e-cigarettes, there was no significant change in exposures after its implementation. In contrast, there was a 30% increase in California e-cigarette exposures following the 2017 Compliance Policy. We conclude that current regulations are insufficient to reduce nicotine toxicities due to e-cigarette use.

Impact of the Compliance system on the Financial Performance of an Economic Entity

The aim of the research is to provide a theoretical and practical justification for implementing a compliance system for business management in order to prevent financial risks. To achieve this goal, the definitions of the concept of "compliance" for business purposes from various sources are considered, since there is no normative concept. The author offers the definition of "compliance" as a set of measures aimed at compliance with legal norms and internal rules of an economic entity in order to protect the interests of owners and eliminate financial risks. The experience of business management using the compliance implementation system is summarized. The significance of the compliance policy at the enterprise as a means of increasing competitiveness and efficiency of activities is revealed. The theoretical and methodological basis of the research is the development of domestic and foreign scientists on the significance of a set of measures aimed at compliance with legislative norms and internal rules of an economic entity in order to protect the interests of owners and eliminate financial risks. It is concluded that companies that use the compliance system are more competitive than other similar companies, which means that they can increase the efficiency of their activities and, as a result, financial results.

Containing COVID-19 by Matching Messages on Social Distancing to Emergent Mindsets—The Case of North America

Public compliance with social distancing is key to containing COVID-19, yet there is a lack of knowledge on which communication ‘messages’ drive compliance. Respondents (224 Canadians and Americans) rated combinations of messages about compliance, systematically varied by an experimental design. Independent variables were perceived risk; the agent communicating the policy; specific social distancing practices; and methods to enforce compliance. Response patterns to each message suggest three mindset segments in each country reflecting how a person thinks. Two mindsets, the same in Canada and the US, were ‘tell me exactly what to do,’ and ‘pandemic onlookers.’ The third was ‘bow to authority’ in Canada, and ‘tell me how’ in the US. Each mindset showed different messages strongly driving compliance. To effectively use messaging about compliance, policy makers may assign any person or group in the population to the appropriate mindset segment by using a Personal Viewpoint Identifier that we developed.

Anti-money laundering ratings: uncovering evidence hidden in plain sight

Purpose This paper aims to increase the transparency of information in official anti-money laundering rating data to assist evidence-informed decision-making in compliance, policy-making and research. Design/methodology/approach This paper converts anti-money laundering rating data into information-rich visualisations, reintroduces a comparison methodology and ranks all anti-money laundering regimes evaluated to date. Findings Official anti-money laundering ratings as currently structured and presented offer surprisingly little policy-relevant information. Persistent failure to transform available data into information for knowledge and insight suggests that the risk has been realised that impressionistic judgments or politicised interests drive the policy agenda at least as much as objective evidence or substantive economic and social goals. Practical implications Any reluctance to generate policy-relevant information from the industry’s primary data set or disinclination to engage constructively with a growing body of independent critical policy effectiveness evidence calls into question whether implementing anti-money laundering controls with some prospect of achieving substantial societal benefits, or perpetuating the current system, prevails. Originality/value With a dearth of scholarship at the intersection of money laundering and policy effectiveness scholarship and practice, this paper combines elements of these disciplines and examines anti-money laundering effectiveness from a different viewpoint. Rather than seeking to measure money laundering or estimate the proportion of criminal proceeds successfully intercepted, this paper draws directly from the anti-money laundering industry’s own “main” data set.

Compliance with Corporate Governance Best Practice. The Perspective of Ownership Structure

The article examines compliance with corporate governance best practice in the post transition economy addressing the heterogeneity of interests of different shareholders. On the basis of the agency theory, we suggest that in the concentrated ownership environment the principal-principal conflict results in lower compliance with the corporate governance code. More specifically, since compliance with best practice requires introducing independent directors and in that sense shifts control from shareholders to the board, we hypothesize that companies characterized by concentrated ownership and the dominant position of the founder/individual investor are reluctant to comply with board governance best practice. To evaluate our hypotheses, we explore compliance with board governance best practice with respect to the presence of independent directors, formation of an audit committee and other specialized board committees (remuneration, risk, strategy). We test the link between the compliance with the code and the ownership structure. Our analysis supports the principal-principalconflict argument and shows that companies with concentrated ownership and founder control do not comply with the board governance best practice. We believe this article contributes to the existing literature twofold. Firstly, we identify the patterns of corporate governance best practice implementation in the post socialist, post transition, emerging economy and depict the dynamics of the compliance with the code guidelines. Secondly, we show that the principal-principal conflict addresses the compliance policy of listed companies and results in various approaches to corporate governance conformity.