Offshore risk and audit advisory
The organizational priorities are rapidly changing with expanded digitization and teams that are geographically redundant, working in collaborative manner. However, the area concerning the Governance, Risk, Audit and Compliance is still preferred to be managed by the centralized teams from the hub, eliminating the chances for offshore consulting and freelancing in these domains. I'd like to know the views of respected members here on the prospect of setting up of consulting firms in the countries with trained manpower providing the services to mostly the developed world where the need of professional resources is on the rise but growing concerns on immigration laws and work-permits.
From the perspective of consulting
The area of Internal Audit & GRC is highly specialized, and by keeping the teams centralized in 2/3 main hubs you guarantee best quality service to the clients by being able to select at any given point in time the best resource available, that fits on the client need.
Also, from the human resources perspective, almost any highly qualified professionals are willing to mark London or New York as places where they have lived and worked, which ensures the best talent will always be attracted to these poles. The reserve case is not always working.
From the perspective of a multinational that has Internal Audit & GRC functions
Internal Audit for the companies has become more a commodity, so you see more and more depratments that run on a hybrid, with some resources centralized for knowledge and some resources decentralized to be close to their areas of responsibility.
Although GRC is not yet commoditized in that sense, the needs to cascade down the GRC decisions from the main hub into the regional or divisional organizations, is also pushing for the hybrid model. Still in this case the methodology and main decision making process remains at the main hub, where the company decision making process takes place.
Dear Suleman Hasan,
But it is already happening. Many compliance teams and internal audit functions in larger companies (and external auditors as well for that matter) are already offshoring/outsourcing this - or in reality parts of it. The overall risk assessments and reporting to the Audit Committees is usually not offshored/outsourced - but the work-intensive, and at times tedious testing of the control environment, is. Often what is used is either teams at the corporates' Shared Service Centre or external authorised auditors (often from the BIg 4) from teams in countries with less expensive salaries.
So if your idea is to fly, it all boils down to the skills of the team you intend to create and your network.
Best of luck
I fully agree with Jane, the off-shoring is already happening, especially for big international companies. In my experience a large international insurance company has a global executive management team however there are local audit teams in certain locations. So, the organisation is used to work in international teams, conducting global audits on a certain topic for example. So, nothing speaks against out-sourcing certain tasks to companies which can provide the same services but to lower costs.
Esther Brändli, Switzerland