Security and transparency: The best foundation for international business in horse racing

The sport of thoroughbred horse racing is a global business that includes major centres in the US and Europe to Dubai, Hong Kong, Australia and Japan. In this globalized economy, security and transparency are crucial factors for successful international business. Whether it’s financial transactions, horse trading, yearling sales, breeding rights, stocks and bonds or other securities, it’s crucial to build trust between parties and ensure that all financial transactions are conducted in a secure and transparent manner.

None more so was this demonstrated in the 2023 Cox Plate where Hong Kong champion Romantic Warrior prevailed over the Australian horse Mr Brightside. Romantic Warrior was born in Ireland but raced in Hong Kong and won at only his second start in Australia in the Cox Plate. With prize money of AUD$5 million, the international financial transactions both now and in the future are significant.

Why is security and transparency important in international business?

In international business, security and transparency are important for several reasons. Firstly, there is a need to protect both buyer and seller from fraud and illegal activity. Ensuring that all parties are properly identified and that transactions comply with all applicable laws and regulations can reduce the risk of financial loss and legal consequences. 

Secondly, there is a need to build trust between the parties. When there is trust between the buyer and seller, it is more likely that there will be a successful transaction and that the parties will be willing to enter into future transactions together.

Finally, transparency is needed to ensure a fair and efficient transaction. By having access to accurate and complete information about the parties involved, the details of the transaction and the underlying securities, informed decisions can be made, and potential conflicts or disputes can be avoided.

How to achieve security and transparency?

To achieve security and transparency in international business, there are several steps you can take:

1. identify and verify the parties

It is important to identify and verify all parties to a transaction. This can be done by requiring valid identification documents and confirming their authenticity through relevant authorities or organizations.

2. Compliance with laws and regulations

It is crucial to ensure that all transactions and activities comply with applicable laws and regulations at both national and international levels. This can include financial regulations, anti-money laundering and counter-terrorist financing.

3. Use of technology and security systems

Technology can play a crucial role in ensuring security and transparency in international business, including the use of LEI codes to identify companies and increase transparency. The use of secure payment systems, encryption technology and security software can help protect against fraud and illegal access to sensitive information. 

The consequences of a lack of security and transparency

A lack of security and transparency in international business can have serious consequences. Some of the most significant consequences include:

1. financial losses

Without sufficient security and transparency, companies can be exposed to inefficient transactions, fraud and hidden costs, which can lead to significant financial losses. These losses can undermine the company’s financial stability and competitive position.

2. Legal consequences

Failure to comply with international standards and regulations can lead to significant legal problems. In addition to direct monetary penalties, companies can face lawsuits, fines and other legal consequences that can have long-lasting and devastating effects.

3. Loss of business partners and customers

Without trust and transparency, companies can experience a loss of business partners and customers. A lack of trust can make it difficult to build established relationships and can result in a poor reputation for the company.

4. Lack of access to international markets

Without adequate security and transparency, businesses can struggle to access international markets. Many countries have strict security and transparency requirements for international transactions, and companies that don’t meet these requirements may be excluded from operating in these markets.

The noble and elite sport of thoroughbred horse racing lends itself to fostering trust between disparate parties and ensures that all financial transactions are conducted in a secure and transparent manner. Long may international horse racing continue and prosper under a safe and transparent financial environment.

Category: Special interest