This week, we kicked off the Beyond Business as Usual luncheon series of the year by hosting a discussion focused on resources, and the need for firms to look across their industry’s value chain, align it to the China context, and create sustainable mindsets for how they will plan for, and use, resources as they deliver their products and services going forward.
To help bring tangibility to the discussion, Frank Rocco, a legal expert and Principal of Frank Rocco & Associates, spoke about his 20+ years of building food and food service companies, and the advisory work he is currently engaged in. Speaking in front of representatives from leading companies in the food, catering and building materials industries there were a couple of key points that were shared in the room:
- Under Xi Jinping’s administration, there is a clear push for better law enforcement and judiciary independence, and many firms / industries are now in a difficult position to understand whether or not they are at risk
- Ambiguous legal definitions and overlapping agencies are making it difficult to assess compliance risk
- Chinese consumers are highly sensitive right now, and a new group of professional advocates who are actively seeking to exploit compliance failures for profit has grown in number (and power)
- Companies are still reacting to the market side dynamics
Focused on helping participants develop the mindset and confidence to take steps that lead to the development and execution of pilot programs, partnerships, and effective stakeholder engagements, the conversation then focused on understanding what was needed to move“beyond compliance”.
To strategically shift to a position from one where the firm is playing catch up (to the rule of law or inflationary trends) to one where constraints in resources, markets, and consumers were anticipated and could become core to strategy. Strategy that could lead to a firm aligning with new markets, supported by the government, consumers, who are looking for safety, and profitable, even if the profit margins are lower.
It was a lot to pack into a single lunch, and next week this conversation will be followed by similar conversations in Hong Kong and Singapore as we engage in similar conversations with industry leaders from those markets.