Latest news with #multinationalcorporations
Zawya
11-08-2025
- Business
- Zawya
Blockchain brings big business trust to small deals
Blockchain, often linked to cryptocurrencies and speculative bubbles, is moving beyond digital coins and is now serving as a backbone for trust and verification, tackling accountability challenges across industries. For decades, letters of credit have been the financial backbone of international trade. These complex banking instruments guarantee that a seller will be paid once goods are shipped and verified, while buyers are assured they receive exactly what they ordered. They give multinational corporations the confidence to do business across oceans and borders, knowing that a trusted financial middleman, the bank, stands behind every transaction. But for small businesses and everyday people, such safeguards have remained out of reach. Engaging banks or lawyers to underwrite a modest import deal or freelance assignment is impractical, given the costs involved. Instead, trust in small-scale transactions has often come down to handshakes, goodwill, and when things go wrong, messy disputes that sometimes end in court. Now developers at North Carolina State University have adapted blockchain-powered smart contracts, digital agreements that automatically execute once conditions are met, to give small businesses or importers, contractors, and freelancers the same level of trust and security long reserved for global corporations.'Letters of credit give big businesses confidence to trade across borders,' says Brandon McConnell, an associate research professor who helped develop the tool. 'But imagine if small businesses could tap into the same kind of assurance. Blockchain lets us do that at a scale that works for everyday people.'The university explained that at the heart of the system are smart contracts, self-executing pieces of code that run on blockchain networks. Unlike traditional contracts that depend on trust, signatures, and sometimes lawyers to enforce, smart contracts are automated. They are programmed to release funds, transfer digital assets, or trigger next steps only when pre-agreed conditions are met. Digital contractFor example, when a homeowner hires a contractor to renovate a kitchen, instead of handing over money upfront or relying on a verbal promise, the homeowner places the funds into a secure digital contract. The contract specifies milestone. Demolish old cabinets, install plumbing, finish countertops. As each milestone is verified, the smart contract automatically releases a portion of the payment. If the contractor fails to complete the work, the money stays locked. If the homeowner refuses to pay after the work is finished, the contractor still receives what is owed. Neither party has to chase lawyers or go to arbitration; the contract executes itself. This shift, says co-lead author Lt. Col. Mat Fukuzawa, could address one of the biggest problems in small-scale contracting, distrust. 'General contracting jobs are notorious for misunderstandings and disputes,' he explains. 'Today, the only fallback is litigation or arbitration, which adds cost and stress. Smart contracts could make trust the default instead of the exception.'What makes the tool particularly powerful is its flexibility. The team designed it to handle multiple layers of complexity. A single project can involve multiple smart contracts overseeing different aspects of the agreement, scope of work, payment schedules, arbitration, proof of licensing, or even insurance verification. Once both sides sign, the blockchain records the entire agreement in a tamper-proof ledger. That record cannot be altered, which prevents either party from quietly changing terms or disputing what was agreed to later. This design also allows for real-world messiness. Proof-of-concept tests showed the system can manage scenarios where contractors abandon a job halfway, clients dispute workmanship, or either side fails to meet obligations. Depending on the coded conditions, the contract can pause payments, return funds, or trigger arbitration. AccessibilityThe difference is accessibility. Banks charge significant fees to underwrite letters of credit, making them viable only for large shipments of goods worth millions of dollars. By contrast, smart contracts run at a fraction of the cost, making them practical for deals as small as a freelance design gig or a kitchen remodel. That lowered barrier could open up an entirely new layer of financial security for small businesses. 'This technology has practical utility across sectors,' McConnell says. 'Contractors, designers, freelancers … people want low-cost assurance that everyone will keep their word.'For small businesses, which often operate on thin margins and cannot afford lengthy legal battles, this kind of low-cost assurance could be transformative. Disputes that once threatened livelihoods could be prevented or resolved automatically. Freelancers, who frequently deal with late payments or clients disappearing, could work with more confidence. And homeowners taking on expensive renovations could avoid nightmare scenarios where money is lost to unreliable contractors. The team behind the project has published two open-access papers detailing their design: Implementing A Letter of Credit Style Business Process for Small-Scale Contracting Using Smart Contracts and Mechanisms for Dealing With the Unexpected in Small-Scale Contracting Using Smart Contracts. Although the potential is enormous, there is also the human factor. Not all disputes are clear-cut, and not everything can be neatly coded into software. Quality of work, for example, is often subjective. That is why the researchers have built arbitration triggers into their system, allowing for human judgment where needed. © Copyright 2022 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. (
The Herald
16-07-2025
- Business
- The Herald
Global events can be the catalyst to unlocking Africa's economic potential
The 54 countries of the African continent together represent the world's fastest growing regional economy, second only to Asia, with a combined GDP of $3.4-trillion (R60-trillion) and consumer spending power projected to reach $2.5-trillion (R44-trillion) by 2030. With a growing, youthful, increasingly urbanised and increasingly middle-class population of about 1.5 billion, vast mineral resources and 20% of the globe's land mass ripe for boosting agricultural output, Africa has the potential to be a key driver of global trade and economic growth. The World Bank estimates that full implementation of the African Continent Free Trade Agreement (AfCFTA), creating the largest free trade area in the world, will boost Africa's income by $450bn (R8-trillion) by 2035 (a 7% gain) and increase exports by $560bn (R10-trillion), mostly in manufacturing. Twelve African countries dominate the ranking of the world's top 20 fastest growing economies (and SA is not among them). Looking at these numbers, one has to ask: Why are we not doing more to take advantage of this potential? Nelson Mandela Bay, the Bay of Opportunity, already hosts the Africa headquarters and in many instances is the anchor for manufacturing operations for the continent and several multinational corporations. We have the geostrategic advantage of our two ports, including Ngqura as one of the few deepwater ports on the continent, creating a hub of both north-south and east-west shipping routes, linking into transshipment and trade into Africa. Those are just two of many reasons for local businesses to be thinking about Africa. This is not to say we should be turning our backs on solid trading relationships with other parts of the world, even amid the turmoil and economic threats raised by the US's tariff moves; but there is untapped opportunity to diversify businesses and export markets right here on our doorstep. Companies in Africa that rely on exports to the US are now in a vulnerable position because we have not paid attention to the enabling market on our own continent, which should be acting as a shield against global economic headwinds. The fastest growing African economies are heavily tied to oil, and Africa's bounty of minerals is a key driver in many others, meaning these economies are highly vulnerable to local supply disruptions as well as price fluctuations in global markets. This is one of the key reasons we need to shift from exports of raw materials at low margins to local beneficiation and become a source of high margin value-added products, with greater opportunities for job creation and deeper value chains. This applies as much to agriculture and agro-processing as it does to minerals and oil. The promise of AfCFTA is creation of a single, continent-wide market for goods and services, business and investment. Operating as a single market will give industry massive, continental scale to support diversified industrialisation — if we can unify as African states on actioning the infrastructure, policy and regulatory enablers. It's a massive market and if we all play our part and play to our strengths, rather than working in sectoral or national silos, or trying to locate an entire manufacturing value chain in any single country, there is no reason for any sector or country to be disadvantaged by increased competition. This has the potential to broaden economic inclusion, creating jobs and business opportunities, and raising individual and state incomes; thereby lifting millions out of extreme poverty and reducing over-reliance on external markets and foreign aid. There is no arguing that there are major stumbling blocks to doing business in Africa — among them unreliable power supply, political and economic instability, infrastructure deficits, and inconsistent connectivity networks, both digital (internet access, ICT infrastructure) and physical (transport and logistics). However, in all these challenges lies opportunity too. The challenges around roads, transport, mobility, infrastructure, food security, and clean water supply can all be addressed from within the continent, with the resources, people and technology that we have, in turn creating business and employment opportunities. For example, as assemblers and sellers of trucks and yellow equipment, and with depth of expertise in civil engineering and mega construction projects, SA businesses have the opportunity to get involved in the infrastructure development needed to enable trade and mobility. Supplying vehicles to transport materials, construction sites, agricultural products to processing facilities; providing diverse mobility solutions, including affordable and suitable e-mobility to serve the massive movement of people and goods to and within urban areas; technology innovation in manufacturing; sustainable agriculture; e-commerce and financial services — these are all within the capabilities of local business. AfCFTA aims to streamline the diverse and variable regulatory environments across different countries — around business permits, customs procedures, tariffs, regulatory measures such as rules of origin for vehicles and sanitary standards for food products, and cross-border financial regulations — to enable the free flow of goods, people, information and capital across borders, improving both intra-continental trade and integration into global supply chains. What is needed now is the political will of African countries to shift gear from talking to action, to reach agreement and implement. African legislators hold the power to create the enabling environment we are all yearning for, that supports the economic and human development interests of an entire continent. There is hope that current global events will be the catalyst that gets us working together to unlock this opportunity. Celestin Ndhlovu is executive vice-president: corporate services at Isuzu Motors SA and deputy president of the Nelson Mandela Bay Business Chamber. The Herald
Forbes
02-06-2025
- Business
- Forbes
Corporate Leaders Are Underestimating The Role Key Enabling Functions Should Play In Business Strategy
Trade wars, regulatory pivots, complex jurisdictional nuances – these are just a handful of the day-to-day challenges that have become major strategic priorities for multinational corporations around the world. In fact, now is arguably the most vital time for C-suites and their respective enabling functions, such as tax, trade, legal, HR, and procurement departments, to be in lockstep when it comes to everything from day-to-day governance to big-picture growth strategy. However, new research from Thomson Reuters finds a significant disconnect between the strategic value these functional departments play and executive priorities for business growth and expansion. At the heart of this push-pull is a myopic focus on what professional departments such as legal, tax, trade, accounting, risk and compliance have traditionally done, and what they can do in a more agile environment. For example, when C-suite leaders were asked about the parts of their business that are the most significant contributors to reaching organizational objectives, they cited customer success teams (78%) and the technology department (62%) as the top two contributors. By contrast, key enabling functions, such as tax (10%), HR (11%), procurement (16%), legal (17%), accounting (17%), and trade (21%) were less likely to be perceived as significant contributors to overall business objectives. Are corporate leaders undervaluing their departments' strategic value? That's a problem, not only for the enabling functions but also for the C-suite leaders, who are clearly underestimating the role that these departments play right now as businesses stare down a global trade war, massive geopolitical and regulatory uncertainty, widespread economic volatility, and ongoing technological transformation. Show me a CEO who is thinking about acquiring a foreign company or reengineering a global trade strategy in anticipation of new tariffs, and I will show you a tax, legal, trade, procurement, HR, and compliance department that's about to play a major role in how smoothly that process will go. Unfortunately, some leaders just don't see it this way, despite widespread acknowledgement of the importance of streamlining compliance and enabling functions. According to our survey of C-suite leaders, time spent on compliance and reporting is the single most common constraint on the effectiveness of enabling functions, with 68% of respondents citing it as a significant or moderate barrier. Additionally, 52% identified ineffective data and information flows between different enabling functions as a significant or moderate constraint. It's in this line of thinking that a dangerous disconnect starts to emerge. The C-suite clearly acknowledges the necessity of improving how these departments operate, yet they regard these issues as tactical problems rather than strategic opportunities. Equipped with the right tools and a sufficiently broad mandate, the enabling functions of a business — such as tax, trade, legal, HR and procurement, and others — possess the capability not only to check off requirements and mitigate risks but also to forecast potential challenges, anticipate new risks, and collaborate with the C-suite to foster business growth. This research also reveals a critical opportunity to elevate legal, accounting, risk, and compliance functions, particularly in the context of AI. While it's clear that C-suite leaders recognize AI's transformational potential, they are not fully leveraging their governance functions to drive that transformation. When these departments are properly empowered with AI and digital tools, they can simultaneously strengthen risk management and accelerate innovation—essentially turning what is perceived as a constraint into a competitive advantage. The research suggests that simplified compliance and reporting and streamlined risk management represent major opportunities for improvement, with C-Suite leaders citing cross-functional initiatives, digital transformation, risk management, and enhancements to customer experience as examples where enabling functions can make significant contributions. By getting more buy-in and consultation from these departments that are on the frontline of many of these battles that organizations are waging, integrations could be cleaner, silos between departments would topple, and the full power of AI can be unlocked. As businesses continue to pursue aggressive digital transformation goals, those that invest in AI-powered tools to empower their governance and financial functions will transform what many C-Suite leaders view as operational constraints into strategic differentiators. But this cannot be done without a fundamental shift in how leaders think about their departments. No longer are accounting professionals just bean counters; they are financial risk forecasters. Legal professionals are now global compliance experts. Risk professionals are forensic accountants. There is so much crossover in the modern corporation that there needs to be a new level of interoperability and a deeper understanding of how these once-siloed functions can collaborate to create a sum greater than the parts.
