At the request of EY, CubeResearch conducted research on the risk related to economic sanctions. The survey shows that 88 percent companies are aware of the severity of penalties for violating sanctions.
“74 percent surveyed enterprises declare that they have taken additional actions in the context of sanction risk management. Despite this, every third of them (31%) was exposed to the risk of unintentional violation of sanctions, and every sixth (16%) admits that they violated them,” we read in the report on the research results published on Tuesday.
The companies that took part in the study declared that they verify their contractors, although the scope of the analyzes conducted varies. The vast majority of enterprises declare that they analyze contractors only in terms of the ability to execute the contract or the solvency of the business partner (73 and 70 percent of responses, respectively). Only more than half of companies (56%) have appropriate risk-based procedures.
“The outbreak of the war and the introduction of sanctions had a significant impact on the activities of enterprises operating on international markets. The majority of the surveyed companies (67%) gave up importing or exporting goods or services from/to eastern markets. More than half (54%) ended cooperation with one of the partners. Changes related to the sanctions regime were also reflected in contracts concluded with contractors. More than two-thirds of the surveyed enterprises (69%) decided to modify the provisions of contracts concluded with their business partners,” we read in the research report.
The study shows that over half of companies (52%) monitor changes in the ownership structure of contractors in order not to expose themselves to the risk of sanctions. Every fourth company (24%) conducts such an analysis when there are indications of an increased risk of cooperation. Every ninth company (13%) does not periodically verify contractors, and uses this process only when starting cooperation.
The study “Risk related to economic sanctions” was carried out on behalf of EY by CubeResearch on a sample of 204 companies using a combined method – CATI (telephone interviews) and CAWI (online interviews).
