Why are Indian companies shifting to proactive compliance?

Indian companies are shifting to proactive compliance due to escalating regulatory complexity, mandatory reporting obligations, and the significant risk of penalties, which directly impact business outcomes and competitiveness.

How has regulation affected Tata Steel's operations?

Tata Steel's Netherlands operations absorbed €150 million in carbon emission costs and €50 million from US tariffs, demonstrating how policy significantly impacts profitability and necessitates proactive regulatory management.

What is the new era of business strategy for Indian firms?

The new era is described as 'regulated strategy,' where compliance is a critical survival metric, prompting boards to adopt preventive vigilance and embed regulatory considerations into core business operations.

Home / Business and Economy / Indian Firms Shift to Proactive Compliance

Indian Firms Shift to Proactive Compliance

11 Feb

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Summary

Compliance is now central to Indian corporate strategy and planning.
Regulatory complexity directly impacts costs, market access, and competitiveness.
Companies move from reactive stances to preventive vigilance models.

Indian Firms Shift to Proactive Compliance

Indian businesses are increasingly integrating compliance into their core strategies, transforming from reactive approaches to proactive vigilance. This shift is driven by escalating regulatory complexity, mandatory reporting, and the significant risk of penalties, which now dictate market access and competitiveness.

Tata Steel, with operations across India, the UK, EU, and Canada, recently highlighted these regulatory impacts. The company absorbed €150 million in carbon emission costs and €50 million from US tariffs in its Netherlands operations. This demonstrates how policy significantly weighs on profitability, as these costs reduced potential operating profit.

Smaller companies like Jyoti Steel Industries also face similar challenges. The rapid evolution of rules often necessitates reliance on customer intelligence for navigation. For instance, a customer revealed Japanese steel was cheaper than Indian steel due to trade arrangements, underscoring the critical need to understand and incorporate regulations into daily business.