Business risk comes from the decision-making mistakes and poor management of enterprises, which may appear in any department of overseas enterprises and run through the whole process of overseas investment. In order to prevent operational risks, we need to pay attention to the following issues:
1. Overseas investment should focus on enhancing the core competitiveness of investors.
Core competence refers to the organic integration of various skills, complementary assets and operational mechanisms that enterprises have competitive advantages in specific operations. It is an organic organization of different technical systems and management systems, and a knowledge system to identify and provide competitive advantages. The strength of core competence is the primary restrictive factor for enterprises to implement overseas investment, and it is also an important indicator to determine the ability of overseas enterprises to resist operational risks. Whether starting a new enterprise abroad or directly acquiring overseas equity, the key to the success of overseas investment lies in whether the core competitiveness of investors can be brought into play and enhanced. If we just blindly merge and diversify, it will often lead to business failure. At present, many domestic enterprises only pay attention to the external effects of overseas investment, such as the concentration of capital and the expansion of scale, but rarely seriously analyze the essential thing of core competence, especially some enterprises with financial strength but no competitive advantage, which equate overseas investment with the expansion of attacking the city, resulting in excessive bidding when acquiring overseas equity, which affects the actual income of overseas investment.
2. Maintain the flexibility of overseas enterprises while strengthening management.
On the one hand, investors should be clear about the authority of internal risk decision-making of multinational companies, and prevent overseas subsidiaries from making their own investment decisions completely, resulting in excessive authority of subsidiaries and out-of-control investment; On the other hand, to avoid excessive management, all investments or expenditures must be reported to the company headquarters for approval, which will affect the normal operation of overseas enterprises.
3. Implement the internal diagnosis system and improve the governance structure and management structure of overseas enterprises.
The risk of overseas operation without a sound competition mechanism and incentive and restraint mechanism is much higher than that of domestic operation. Therefore, the formation of a sound governance structure is the premise for overseas enterprises to cope with operational risks. First of all, by strengthening the financial supervision of overseas enterprises and improving their internal control mechanism, there is a serious shortage of accountants, especially experienced accountants, sent by domestic investment units to overseas enterprises. Many overseas enterprises have imperfect internal accounting management and accounting systems, and the problem of "multiple accounts" is serious. Some overseas branches even have an accountant and cashier to save money. This irregular financial system will often become a loophole, which can be used by corrupt and fraudulent people, resulting in a large loss of state-owned assets. This situation requires investors not to let go of overseas enterprises, and specialized audit departments should conduct regular and irregular audits of overseas subsidiaries, especially to prevent the use of state-owned assets and foreign exchange funds for overseas speculation. Secondly, when the governance mechanism of overseas enterprises is sound, the parent company can arrange internal governance with the strong supervision of the external governance environment to achieve effective governance and control of overseas enterprises. For example, many multinational companies introduce representatives and independent directors of local creditor banks to the boards of directors of overseas enterprises to strengthen the supervision of overseas subsidiaries. Finally, the parent company should take the internal diagnosis system as an important means to improve the governance and management structure of overseas enterprises, set up special institutions, conduct internal evaluation on the operation and management of overseas enterprises regularly, and put forward corresponding improvement suggestions.
(B) guard against system risks
Overseas enterprises can't decide the political and economic situation of the country where they invest, so they can only take measures to avoid systematic risks and minimize their adverse effects:
1. Do a good job in evaluating the political and economic situation of the country where the investment is located, and pay attention to drawing on the professional strength of large international investment consulting companies.
Before investing, enterprises should make a comprehensive evaluation of the economic development, political stability and preferential policies for foreign investment in the country where they invest. After the establishment of overseas enterprises, overseas managers should also be required to provide timely information on various local policy trends for analysis by specialized agencies. The evaluation work is highly professional, and due to the limited strength of general enterprises, it is necessary to attach importance to the professional knowledge of intermediary institutions such as consulting companies. With the development of foreign multinational companies, a number of large consulting companies have emerged that are committed to overseas investment. For example, the largest Hamilton consulting company in the United States was established in 19 14, with 1500 consultants, including more than 800 experienced experts. Their services have obviously improved the efficiency of customers' overseas investment. Because there is no mature overseas investment consulting company in China at present, in order to reduce the investment risk, it is necessary to entrust a large foreign investment consulting company to evaluate large overseas investment projects, although the consulting fee is relatively expensive.
2. Change the investment mode, implement the localization strategy of overseas enterprises, and strengthen the public relations strategy for the investing countries.
Implement the "win-win" strategy of overseas investment. As far as possible, joint venture is adopted in the investment mode to gain some recognition from domestic enterprises and make the joint venture share some investment risks; Investment in sensitive areas such as resource development can be made in the form of debt according to the situation of the host country, and income can be obtained through product sharing to avoid the risk of nationalization caused by direct control; If investors have the advantages of brand, technology and management, they can also take the form of franchising like McDonald's, which can save money, avoid direct investment risks and occupy the market. Adopt localization strategy in the operation of overseas enterprises, on the one hand, hire more local employees, on the other hand, try to realize localization of procurement. Overseas enterprises must pay attention to shaping a good "public image" in the local area, have clear public relations strategies for the countries where they invest, and actively integrate their own development into the economic development of the countries where they invest.
3. Reduce losses caused by system risks through insurance.
Enterprises can reduce the risk of overseas investment by joining insurance. For example, the World Bank established a multilateral investment insurance institution in 1988, which together with multilateral treaties between countries provides treaty protection for systemic risks such as nationalization in foreign direct investment. When multinational companies become members of this convention or institution, some systemic risks in overseas investment can be controlled to a certain extent. When losses occur, they can also apply for international compensation to provide international guarantees for enterprises' overseas investment.