From Cuba’s decades-long embargo to more recent restrictions on Iran, North Korea, and Russia, global sanctions reshape international industries. In addition to imposing steep barriers for companies and their supply chains, they increase compliance costs and can erode company reputations. For highly interconnected sectors like finance, energy, and technology, these challenges can be especially severe.
Sanctions have a wide variety of purposes and targets, from economic disincentives to supporting regime change or encouraging democratic transition. However, the effectiveness of sanctions depends on a number of factors, including the scope and timing of the targeted actions. Moreover, a sanctions policy’s success is often dependent on the ability of the sanctioning country to prevent leakage by third parties, such as criminal elements building illegal networks of intermediaries, nonparticipating countries allowing or facilitating sanctions evasion, and poor enforcement and compliance among participating states.
As a result, it is important to understand how different types of sanctions affect businesses. For example, a financial sanctions might target assets held by the targeted individual and prohibit trade with those individuals or entities. In such cases, a firm could face significant revenue losses due to market share declines and contract cancellations.
The key to managing the impact of financial sanctions is the ability to identify and isolate sanctioned individuals and companies. This requires an advanced sanctions screening solution that supports a diverse range of languages and scripts. Fincom’s Phonetic-Linguistic Engine accurately matches names in 44 languages in their original scripts, overcoming spelling variations and transliterations to ensure the most precise match possible for global sanctions screening.
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