ST Engineering, with its operations in several parts of the world, is subject to applicable laws and regulations of various jurisdictions. Failure by us to comply with these laws and regulations may result in criminal liabilities such as fines and penalties, and / or suspension or debarment from government contracts.
The Group has in place a regulatory compliance framework that proactively identifies applicable laws and regulatory obligations, and embeds compliance into the day-to-day business processes. Annually, a report is prepared showing performance in this area. It sets out information such as training conducted, audits and audit findings, violations, fines and penalties, if any. This report is shared at the Sector Risk and Audit Committee and the Risk and Sustainability Committee meetings, where lessons learnt from major violations of laws are distilled and shared.
Examples of those laws and regulations which the Group deems to be of material importance include anti-corruption laws, aviation laws and regulations, export controls and safety and environmental regulations. Our Aerospace sector implements sector-wide quality and safety management systems for compliance with aviation laws and regulations. Our fraud risk management framework helps to mitigate the risk of fraud, and is deployed Group-wide. Exports of ordnance products, which constitute a portion of ST Engineering’s sales, are typically subject to export control regulations. Changes in these regulations could impact the Group’s sales, while non-compliance could result in financial penalties, suspension of projects or even restrictions on future export business. We continue to place great emphasis in this area and have instituted formal systems and designated personnel to ensure export control regulations are complied with.