Enterprise legal risks refer to the potential or actual significant economic losses caused by economic disputes and lawsuits caused by enterprises not understanding legal rules, neglecting legal review, and evading legal supervision in their operations. Such as debt arrears, contract fraud, blind guarantees, softened corporate governance structure and weak supervision, investment without legal feasibility demonstration, lack of legal decision-making procedures for project operations, human-centered corporate decision-making, easy misappropriation of funds, and difficulty in identifying fraud in insurance policies, bills, and letters of credit. , fraud risks in international cargo transportation, anti-monopoly and anti-dumping lawsuits arising from international investment and international cooperation, repeated introduction of technology, no trademark and patent searches for project development, no review of land legality in project cooperation and real estate business, unfair competition to enterprises The ruined reputation it brings and so on.
How to avoid legal risks in business operations:
1. Improve managers’ legal awareness and cut off the sources of legal risks.
The so-called corporate legal risks refer to the potential or actual major economic consequences caused by economic disputes and lawsuits caused by corporate operations that do not understand legal rules, neglect legal review, and evade legal supervision. loss. For enterprises, any behavior of the enterprise may involve legal risks of varying degrees. Legal risks are everywhere just like market opportunities are everywhere. "Restructuring, mergers and acquisitions, reorganization, foreign investment, contracts, production and marketing activities..." Especially with the continuous deepening of the market economy, the environment faced by enterprises has become increasingly complex and changeable. If the legal awareness of enterprise managers is still limited to This kind of legal remedy to put out fires afterward to protect legitimate rights and interests has fallen far behind the requirements of the development of the times.
Business managers do not need to be proficient in legal knowledge, but they cannot lack legal awareness. The author believes that legal risks in business operations can be prevented in advance. Even though some "accidents that shouldn't happen" still happen frequently, the reason is that our corporate managers are not strong enough in legal awareness, their awareness of preventing legal risks is not deep enough, and they have not invested enough in legal risk prevention (including investment of energy and money). According to statistics, the average cost of preventing legal risks by American companies accounts for 1% of the company's revenue. But what about China? Most companies have seriously insufficient investment in legal risk management, their legal risk defense capabilities are very weak, and the risk of losses due to legal risks is even greater. high.
Experience tells us that the existence of legal risks in business operations is not terrible. What is terrible is that we do not pay attention to it, guard against it, and allow it to develop. Therefore, we should pay attention to improving the legal awareness of business managers, further familiarizing themselves with legal knowledge related to business operations, and conducting security inspections of legal risks in the business, promptly discovering legal risks hidden within the business, and taking precautions or preventive mechanisms in advance to avoid business risks. Legal risks in operations and cutting off the root causes of legal risks.
2. Take preventive measures before they occur and conduct regular legal risk assessments.
If an enterprise wants to achieve long-term stability, it needs to have a complete internal management system and risk prevention and avoidance mechanism, know the risks in advance and try to avoid the occurrence of legal risks. With the continuous development of our country's legal economy and the continuous improvement of laws, our business managers should also further change their concepts and have a major improvement in legal awareness, that is, from the awareness of "fire fighting" to the awareness of "fire prevention"; from the awareness of legal relief to the awareness of legal precautions; from the awareness of safeguarding rights according to law to the awareness of governing enterprises according to law. In short, we need to improve our legal awareness from passive to active awareness.
Enterprises should be on guard against potential risks, take precautions, internally determine an effective risk avoidance mechanism, invest a certain amount of energy, manpower, and financial resources, establish legal "firewalls" in advance, and isolate the subject qualification risks involved in the business process. , financial hidden risks, human resources risks, property rights structure risks, litigation and arbitration risks, property rights transactions and investment risks, dynamic risks of laws and regulations, exchange rate change risks, contract management risks, business reputation risks, intellectual property risks, geographical and customer relationship risks We should wait for legal risks to block the development of enterprises, and find a path to sustainable development by governing enterprises according to law.
Business managers should conduct legal risk assessments for their companies on a regular basis every year. The so-called legal risk assessment refers to the investigation of legal risk matters of the target enterprise through legal and related industry experts, and the issuance of a "Legal Risk Assessment Report" to provide preventive legal precautions and feasibility recommendations. By reviewing the company's organizational structure, equity structure, governance structure, company articles of association, company licenses, internal management systems, business processes, financial management systems and processes, decisions and processes for signing major external contracts, labor contract management, fixed assets Management, intellectual property and other projects are investigated and evaluated respectively, and potential legal risks and potential lawsuits that may exist therein are discovered. Through the "Legal Risk Assessment Report", possible legal risks that may exist in the company are disclosed in a timely manner to attract sufficient attention of corporate managers, and then, with the help of the legal advisory team, take appropriate measures in a timely manner, and ultimately take precautions and prevent problems before they happen.
3. Establish and improve legal risk early warning, prevention and avoidance mechanisms, and effectively improve legal risk defense capabilities. When enterprises “go global”, laws must come first. “No matter how advanced your driving skills are, there is still the possibility of being rear-ended.” No matter how big or powerful a company is, it is important to guard against legal risks. There are legal risks in various behaviors of an enterprise, and any type of legal risk will cause the loss of business opportunities; widely publicized legal risk matters will cause great damage to the goodwill of the enterprise. When this damage occurs, there is another risk that the business can become trapped in a vicious cycle. Damage to goodwill can lead to a loss of confidence among business partners, which in turn can lead to a drop in revenue, a loss of investor confidence, and ultimately a drop in stock value.
The Boeing Company in the United States has 500 senior executives at its headquarters, including 232 legal advisers, accounting for about 46%. The "Legal Risk Survey of China's Top 100 Enterprises" conducted by relevant departments last year showed that, Most Chinese companies do not have a clear understanding of the legal risks of "going global". The cost of legal risk prevention for Chinese companies is only 1/50 of that of companies in developed countries.
The early warning mechanism should be based on analysis. The legal risk prevention mechanism emphasizes forward-looking, emphasizing on preventing problems before they occur, and attaches great importance to the improvement of legal risk defense capabilities to effectively reduce the losses of enterprises. Through risk analysis and assessment, risk control management, risk monitoring and updating and other methods, we can discover and identify potential legal risks in business, production and management activities.
4. Accurately grasp the sources of risks and avoid legal risks to the greatest extent.
Surveys show that large enterprises in Western developed countries generally actively adopt standardized legal risk prevention measures, among which accurate grasp of risk sources is a highlight. For our transportation companies, risks accompany the company as long as it exists. In the trade-off between economic benefits and social benefits, risks and crises exist. Among them, the following sources of legal risks are particularly worthy of attention.
Legal risk in contract management: refers to the possibility of damage or loss to the interests of one or both parties to a contract during the process of contract negotiation, conclusion, performance, change and transfer, termination and determination of liability for breach of contract. During the operation of an enterprise, financing contracts, cooperation contracts, construction contracting contracts, and material supply contracts involve huge amounts of money. Especially if it fails to undergo effective legal risk assessment and control, it is very likely that there will be greater legal risks, leaving potential disputes for both parties.
Legal risks in mergers, acquisitions and transfers: Enterprise mergers involve corporate law, competition law, tax law, intellectual property law and other laws and regulations, and the operations are complex, having a greater impact on society, and the potential legal risks are higher. Some of them involve transfer of management rights in special industries with large subject matter, difficult value assessment, cumbersome transfer procedures, and high integrity risks. Although transfer procedures and requirements are standardized, the legal risks in the operation are still huge.
Intellectual property legal risks: Intellectual property is the result of creativity and wisdom, and its object is a special property in a non-material form, which requires special attention from relevant corporate management agencies.
Legal risks in human resources management: The Labor Law, the Labor Contract Law and the relevant labor and employment administrative regulations and departmental rules formulated by the State Council are the legal system to protect the rights and interests of workers.
As a long-established road transportation enterprise, it is a labor-intensive enterprise. In all aspects of the human resources management process, from recruitment, interview, employment, employment, signing of labor contract, employee treatment issues to employee resignation, there are Subject to relevant labor laws and regulations, any failure by an enterprise to comply with the law may cause labor disputes to the enterprise.
Financial and taxation legal risks: The tax-related behavior of enterprises is directly related to the future interests of the enterprise because it involves compliance with financial, taxation and other laws and regulations. For example, some enterprises pay more or less taxes, or because they involve bear corresponding legal responsibilities for tax purposes.
Legal risks in operation and management: As a transportation company, in the operation and management of vehicles, safety and other management work, it involves the legal risks of infringement caused by management defects, the risks of contract disputes caused by the collection of service fees, and the risks of traffic accidents. Legal risks such as personal and property damage compensation arising from the incident.