Overview
Why do sophisticated corporations that invest abroad often have to abandon their investment after incurring huge financial losses, loss of reputation, and disastrous law suits against them arising from those operations? Was it because they failed to conduct a risk analysis that actually assessed the real risks of foreign investment? Did they understand those risks or did they just ignore them because they were too complex to analyze? Is your company considering foreign investment opportunities—if so, what should the company be aware of? What constitutes due diligence?
RIBR-605 is a course designed to provide answers to the above questions by showing how, in the wake of globalization, international risk analysis, including aspects of international law is of vital importance to businesses. This course offers tools to enable one to analyze and manage internal and external risks that companies face even if not operating in the international arena! Such tools are invaluable for all executive and senior managers, as well as Board Directors in today’s dynamic enterprises.
Setting up projects or investing in foreign countries without realizing the potential risks of such activities is commonplace. This course is designed to provide an understanding of these foreign aspects in order to support decisions that both understand and minimize the risk of doing business in various global contexts. The course focuses on answering these basic questions:
- What is my business exposure to the international risks?
- What are my business’ rights when operating across borders?
- How can I protect my business against materialization of legal risks?
Students will explore international practices through a series of topics. Content covered includes understanding the legal risks of foreign investment, minimizing the risks by investing in countries which have Bilateral Investment Treaties with the home country, political risk insurance and using international arbitration or mediation to settle disputes which may result in awards which are enforceable against the assets of the foreign government.
Outline
Weeks 1-7: During the first seven weeks of the course, enrolled students will be assigned readings and book chapters in addition to participating in group discussion databases and completing individual and group assignments. Topics include human rights and business, corruption and business, being of fundamental importance to global business.
Week 8: The in-residence week will consist of inter-active seminars with leading global institutions, guest speakers who share experiences and advice for engaging in problem solving related to the understanding and management of international business risks. Students can expect to spend most days engaged in seminars at leading global institutions, and interacting with guest speakers at various venues.
In-Residence Highlights: Previous years’ in-residence weeks have been in Washington, DC, and have included the rare opportunity to visit and engage in interactive seminars with global organizations such as World Bank agencies, US Department of State, Canadian and Mexican Embassies and TRACE International. The in-residence week for 2020 is scheduled to take place in D.C.
Weeks 9-10: Further readings and online discussion to synthesize the learnings during weeks 1-7 with the in-residence experiences.
Objectives
As a result of this course, students will:
- Understand the internal risk
- Explore the differences in types of legal risk (eg, working with foreign governments, as well as public agencies that are independent of the foreign government and private companies), and be able to assess risks in various international business contexts.
- Understand why companies do poor jobs of analyzing investment risks that are not primarily market/economic risks.
- Understand the external risks
- Understand those elements of politics and international law that affect the risks of a business abroad,
- Understand the political, legal and reputational risks of investing in a project in a foreign country,
- Learn how international regimes regulate multi-national enterprises and explore issues such as human rights law, corruption, and corporate social responsibility as they affect international investment.
- Learn about risk mitigation tools and strategies
- Understand the benefit of the Bilateral Investment Treaty scheme and the degree of protection that such treaties provide. Learn which countries have such treaties and how this influences decisions about which countries to do business in,
- Understand how to assess and reduce corruption risks in doing business abroad.
- Understand the importance of human rights issues in doing business abroad, and the potential liability that can arise from failure to implement proper human rights programs
- Design an investment strategy incorporating new knowledge on international risks,
- Learn the concepts of international commercial arbitration—the benefits of having disputes resolved through international arbitration rather than local courts,
- Understand how arbitration awards can be enforced against a foreign government in the event that the government breaches their agreements with the investor.