Criminal risk on the field

Running modern transnational companies sometimes means doing business in locations where your business is vulnerable to criminal risk. The EDHEC MBA offers an innovative program, led by Dr. Bertrand Monnet of the Criminal Risk Management Chair, which specializes in the challenges faced by multinational companies covering fraud to extortion, piracy to failed states.As part of the Criminal Risk Management class at the EDHEC MBA, the class traveled to Paris to take part in training and education at the GIGN headquarters.


Pr Bertrand Monnet is professor and Scientific Director of IMARISC Institute for Criminal Risk Management at EDHEC, who was previously an officer in the French Marine Corps and took part in NATO peacekeeping efforts in Bosnia. IMARISC conducts research and monitoring of criminal activities worldwide through the monitoring of worldwide criminal activities and partnerships with corporations and law enforcement agencies, as well as direct contact with organized crime members.

Exposure to this facet of business management is highly unusual in an MBA program, even though criminal activities cost companies and shareholders hundreds of billions of dollars every year, as recently demonstrated by the Madoff affair, Enron, Countrywide, WorldCom, the pirates of Somalia, the guerilla forces of the Niger Delta, the guerillas in South America, the Taliban in Afghanistan and so on.  Dealing with these challenges are going to be a big part of running international businesses and the EDHEC MBA is leading the way in providing a thorough education of its graduates.


The EDHEC MBA visits the GIGN Special Operations

As part of the Criminal Risk Management class at the EDHEC MBA, the class traveled to Paris to take part in training and education at the GIGN headquarters in Versailles.

The GIGN is the National Gendarmerie Intervention Group (Groupe d'Intervention de la Gendarmerie Nationale), the French Gendarmarie's elite Special Operations counter terrorism and hostage rescue unit tasked with anti-piracy, anti terrorism, VIP escort, kidnapping and extortion, and other high-risk law enforcement by the French national government. The unit was established in response to the hostage tragedy at the 1972 Munich Olympic Games. 

The GIGNs responsibilities include protection, anti-piracy, anti-terrorism, extortion and kidnapping; operations have taken place world-wide. Many of the world's special operations units conduct exchange programs with the GIGN.

The GIGN - EDHEC education session was the first ever such course agreed to by the GIGN.  This is part of a partnership between EDHEC and the GIGN to establish contacts with leaders in the business community.  The EDHEC Criminal Risk Management program tracks and documents criminal risks worldwide and cooperates with the GIGN in these efforts.

EDHEC MBA students were given a history of the GIGN and a full description of its capabilities, including a mock hostage situation. In a question and answer session with students, GIGN leaders described the risks faced by business leaders world wide and the necessity of managers to be prepared to meet those risks.  Forces like the GIGN are available to business leaders to protect interests and citizens of many countries, the GIGN being responsible for French interests domestically and abroad.  In particular students learned about the difficulties faced by the executives of a leading shipping company when its workers were taken hostage recently.  The hostage situation was resolved successfully by the GIGN together with the company's management team.

As companies operate internationally, and executives are tasked with protecting the interests of employees and shareholders in many nations, the message of the GIGN was for business leaders to be prepared to meet these threats.  They were also very forthright in showing EDHEC students just how their elite service could be of use to them should the need for their expertise ever arise, anywhere, any time.


EDHEC MBA Seminar on Combating Fraud

EDHEC MBA students were given a course on Occupational Fraud by the Vice President in charge of DHL's global security and crisis management operations, Leon Jankowski.

Companies worldwide lose an average of 7% of revenues due to occupational fraud and the cost to companies in the USA alone amounts to $660 billion. The majority of losses are the result of fraud committed by executives and accounting professionals and a surprising 82.6% of those committing fraud are never punished.  Most of those committing these offenses have Bachelor degrees.  Most act alone.

What is a manager to do in the face of these statistics?  One thing Mr. Jankowski made clear is that this kind of theft will never be eliminated; it can only managed.   He outlined the warning signs can alert executives to a likelihood that something is going on.

He explained that the way different cases of fraud are seen and sanctioned by the company varies very much depending on the country.  Theft in France, for instance, is often treated as a minor infraction only due a warning, whereas if the same act were committed in the United States the employee would go to jail! 

Dealing effectively with these pervasive threats can literally turn a company round from losses to profits without any further changes in operations.  Practical management techniques such as those delivered to EDHC MBA students by Mr. Jankowski in Paris will help students increase performance of their companies in this area after graduation. 

This is another way the EDHEC MBA delivers value to students by marrying practice to cutting edge research and theory to create effective business leaders.


Written by NIKKI HARLE