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German Companies Must Rethink Governance Amid Regulatory Pressures and Global Risks
Berlin, Germany - Managing companies has become increasingly challenging due to ever-increasing regulatory requirements, stakeholder expectations for greater sustainability, geopolitical developments, and interest rate turnarounds. The scope of legal regulations has grown just as much as customer expectations, while new global risks have emerged.
To ensure compliance and organize company management effectively in this environment, German businesses must rethink their approach to governance. This involves recognizing and managing global risks at an early stage, establishing a culture that promotes good governance, keeping governance costs under control, and leveraging digitalization opportunities.
Managing Risks and Acting Compliantly
KPMG experts support companies in adhering to compliance guidelines and managing risks through a holistic, integrated approach. This includes:
- Strategic management
- Financial reporting
- Non-financial reporting
- Compliance
- Operations
- Environmental, Social, and Governance (ESG) management
The company’s risk and compliance management systems are designed to promote effectiveness while increasing efficiency through standardization and digitalization. Established systems enable auditing and certification in accordance with relevant IDW and ISO standards.
Governance: A Critical Component of Success
Effective governance encompasses the overall control of a company, enabling early identification of opportunities and risks from strategic, operational, economic, and legal areas. To generate added value for the company, this control must be integrated into daily business operations.
Key Questions on Governance and Compliance
Companies should ask themselves:
- How is governance defined in our organization? What are its goals and what is the added value?
- Which topics and risk areas are currently affecting our company and will most likely do so in the future?
- Which regulatory compliance requirements must we deal with, and which ones are likely to emerge in the future?
KPMG Experts Can Help
To address these questions and ensure effective governance, companies can rely on KPMG experts. Our team provides customized solutions to help businesses navigate complex regulatory environments, manage risks, and establish a culture of good governance.
Some of the areas where we provide support include:
- EU AI Act: We help companies understand and implement requirements for the integration of artificial intelligence technologies while maintaining compliance and ethical standards.
- Corporate Sustainability Reporting Directive (CSRD): Our experts guide companies through every step of the ESG reporting process to ensure compliance with CSRD requirements.
- Supply Chain Due Diligence Act (LkSG): We support companies in identifying, assessing, and mitigating risks in their supply chains while ensuring ethical standards along the entire supply chain.
Our Governance Client Cases
KPMG has extensive experience in governance matters, with a strong track record of delivering successful client projects. Our team is committed to helping German businesses navigate complex regulatory environments and establish effective governance practices.
For more information on our services or to discuss your specific needs, please contact us directly.