Any unrest has an almost immediate effect on the economy, slowing down areas it impacts and creating ripple effects. The overall cost of violence in India, including activities by anti-social forces (ASF), was estimated at US$646 billion in 2020, representing ~6% of India’s GDP.
Anti-social forces are groups engaged in unlawful activities that threaten public peace, individual rights, and the integrity of the legal system. These groups operate in various forms, from organised crime and corruption to cyber threats and extremist movements. They often find loopholes in law enforcement and technology to expand their influence, making strong compliance and risk management essential.
Activities such as organised crime, corruption, and financial fraud lead to economic disruptions, discouraging investment (including FDI) and causing financial instability. Security of citizen’s is threatened by violence, terrorism, and white-collar crime instigated by extremist groups. This has a severe impact on social stability and business environments, necessitating proactive measures like corporate investigations, continuous due diligence, and enhanced compliance controls to counter their influence and mitigate risks. This monetary loss highlights the severe economic burden caused by these disruptive activities, affecting business operations, foreign investment, and public safety.
Business vulnerabilities and economic fallout from ASF:
Such groups employ various methods to cause harm and disruption, from financial crime networks and cyber fraud rings to organised syndicates, extremist outfits, and communal forces, each threatening stability and national security.
In certain scenarios, if a link between a business and such forces becomes public, it could irreparably harm a company’s reputation. Fraudulent actions like AML (anti-money laundering) failures can drain company resources, leading to heavy debts and financial instability. Additionally, such activities can disrupt the supply chain, impact market confidence, and cause higher security costs, emphasising the need for comprehensive governance risk and compliance frameworks.
Apart from financial losses, the association between a business and anti-social forces can have a severe long-term impact, making recovery difficult. To ensure an ethical and transparent business environment, companies must implement corporate due diligence measures such as background screening, litigation history checks, and senior professional vetting to identify potential threats. Building a robust system for vendor due diligence and third-party risk management (TPRM) is crucial for sustainable and responsible governance.
Key principles to avoid involvement:
Zero Transactions with Anti-Social Forces
Companies should categorically refuse any business dealings with anti-social forces, supported by strong corporate due diligence and legal compliance practices.
Immediate Termination of Existing Relationships
If business partners or clients are identified as such, appropriate legal investigation steps and due diligence processes should be taken to terminate dealings and document actions in a comprehensive report.
No Financial Support to Anti-Social Entities
The company should strictly prohibit the provision of funds or financial assistance to individuals or organisations classified as anti-social forces, in line with anti-corruption investigations and anti-bribery compliance standards.
Rejection of Unfair Demands
The company should not tolerate any unfair or coercive demands from anti-social forces. Upon identification of such demands, they should pursue all the necessary legal actions, including civil or criminal proceedings, against the offending parties.
Collaboration with External Authorities and Experts
Companies should maintain close collaboration with law enforcement, compliance professionals, corporate risk advisors, and global sanctions screening experts. Using tools such as adverse media screening, UBO identification, and asset tracing services ensures ongoing monitoring and protection against reputation damage.
Anti-social forces hinder both societal well-being and economic growth. Businesses can maintain social responsibility by applying integrity due diligence, governance and ethics assessments, and sustainability risk assessment practices.
Implementing enhanced due diligence and thorough background checks ensures ethical operations and upholds long-term trust in the market.
Stay ahead of emerging threats. Learn how enhanced due diligence and compliance monitoring can help your business eliminate exposure to anti-social forces. Connect with our experts now.