Daniel Diermeier

The regulatory environment of today’s corporations is undergoing dramatic changes. The stakes for effective regulatory management have never been higher. Board members rank regulatory and compliance risks as their top concerns, and every day another company makes the headlines with a new corporate crisis. We now live in an ever-faster-moving news cycle, driven by intense competition between 24-hour news channels, wire services, and online news providers. And the rise of the consumer-generated media has started to shift the balance of power from companies to customers and other stakeholders. Transparency is increasingly in demand, and companies and regulators are forced to respond ever more quickly to the scrutiny of the public. These risk factors are further amplified by the globally integrated supply chains that cannot be effectively regulated by national regulators. The global reach of companies has been matched by the globalization of activist organizations. Concerned about regulatory gaps, nongovernmental organizations (NGO) that try to have significant social impact increasingly will shun public institutions; instead, it will target a multinational company with global operations. How should regulatory managers respond to these changes? How do they adopt a strategic mindset that resonates with senior managers and the board? How do we develop the capabilities to anticipate problems and manage them proactively?