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Companies must commit to compliance when pursuing mergers and acquisitions

Azba Habib is Global Chief Compliance Officer at FLEETCOR in Atlanta, Georgia, USA.

Many global enterprises and startups are growing exponentially and rapidly by expanding their geographic footprints. During 2020 in the United States alone, a Salesforce report showed more than 4.4 million new businesses opening,[1] which is the highest number on record and a 24.3% increase from 2019.

According to an EY report, global mergers and acquisitions (M&A) decreased by 9.7% in 2020, but by 2021, M&A activity was trending upward, particularly cross-border M&A activity. Accelerated vaccine administration, increased corporate confidence, and the consolidation of some large players helped fuel the acceleration, the report revealed.[2]

The outlook is even brighter now, with a separate EY report revealing 60% of US chief executive officers plan to actively pursue M&A in the coming 12 months.[3]

While operations teams focus on maintaining growth, other departments must stay focused on compliance issues, especially as they factor in disparate and evolving accounting standards, local laws, and reporting obligations across different countries. And while growing pains are challenging and part of the game, they are anything but insurmountable.

Here are five key areas that, done right, make M&A growth smoother for compliance teams.

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