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Companies must understand cultural differences in international expansion, or risk prosecution


Companies that expand overseas are laying themselves open to commercial and reputational risks if they fail to acquaint themselves with the cultures of the host country, according to a study.

Businesses expanding overseas must understand cultural differences to reduce the risk of alienating stakeholders or even criminal prosecution, a report has warned.

International Business Expansion without the Pain, by professional research firm IDC and commissioned by professional services company TMF group, found HR faces huge challenges when a company expands globally.

The research, seen exclusively by HRmagazine, found expansion into new territories is often “fraught with commercial and reputational risks”.

It stated that as markets and supply chains continue to globalise and the buying power shifts from western economies to Asia, Latin America and Africa, HR must adapt to the many challenges.