Gaining a foothold in a foreign country is no easy task, and some good advice alone will not suffice. Trade Development at BNP Paribas Fortis is the perfect partner to turn theory into practice!

Many companies want to try their luck outside our borders and gain a foothold in new markets. This is necessary not only to be able to continue to grow, but also to remain competitive. But if you don't know where to start, it's hard to put your money where your mouth is. How do you find the right market? How do you find prospects? How do you prepare the whole operation in all its aspects? What risks do you need to cover? And which partner can you trust? All important questions that can make or break your project. And this is how international ambitions are sometimes left on ice.... 

"We want to help companies achieve their international ambitions", says Rob van Veen, Head of Trade Development at BNP Paribas Fortis.

"We look at the local market into which the company wants to launch and make sure the underlying potential is sufficient." And so, the first step towards success is taken.

WHEN GOOD ADVICE IS NOT ENOUGH...

There's a deep gap between theory and practice that managers do not always dare to cross. It's essential to collect a lot of data and information, but this is certainly not enough. Talk must then be followed by action.  Your growth project's first stone must be laid... preferably with the greatest possible chance of success and as few risks as possible. In such an adventure, (good) guidance is not a superfluous luxury. Even more reason to call on the support of Trade Development: a partner who can assist you with a wide range of solutions and help you establish a long-term strategic vision. In Belgium and beyond. 

"In their project's first phase, companies often find a lot of information and support from the Belgian export promotion agencies", says Rob van Veen.  "But they don't get all the practical answers they need to roll out their activities in a given country."

CHOOSE WISELY!

Given that growth prospects in Belgium are rather limited, companies must therefore look for international growth. But where? This is where the Trade Development team comes in. Your choice of target market is certainly crucial. A vague, poorly thought-out decision can have dramatic consequences: examples of failure abound – partly because companies don't understand the local 'culture'. Companies sometimes gravitate towards exotic markets because others have gone before them. But every international project is unique: does the market fit into your overall strategy? Are you aware of all the challenges that lie ahead (regulatory, commercial, etc.)? 

"Let's take the example of a company that wants to set up in Brazil. Our first question is then: what activities have you already been carrying on in Europe? Might there be new, undiscovered opportunities there? For example, it's much easier for a company to set up in Poland than in Brazil, where taxes on imports are extremely high" , continues Rob van Veen.

HIGHLY NECESSARY 'LOCAL' CONTACT PERSONS 

Your project has taken shape and you've determined your target market. The time has then come for Trade Development to roll out one of its greatest assets: access to a global network of competent and reliable partners.

"We introduce the client to local specialists who can support their project abroad from start to finish. One deals with the roll-out of activities, another specialises in legal and tax issues, and a third takes care of the administrative side of things. We prefer to work with small, local agencies, most of whom are long-term BNPPF network partners", says Rob van Veen.

These contact persons have a perfect knowledge of the national rules and customs and know how to adhere to that specific framework. The company therefore has the great advantage that it can benefit from such a skilled team: a win-win situation. "In addition, our permanent contact persons are evaluated by the client after each project. This way, we can guarantee the quality of our services!" 

BUILDING RELATIONSHIPS: Save TIME AND gain EFFICIENCY

Are you looking for an effective distributor or a reliable representative? An ideal on-site supplier? Do you want to determine these contacts' actual potential or get to know possible new partners? Not easy for a company… 

"Most of them are looking for a white knight. Our trade developers draw up realistic selection criteria in consultation with the client. They carry out a financial analysis of the commercial partners and check their technical baggage and their reputation", explains Rob van Veen.

First, a list of four or five serious and interested candidates is drawn up, and then the contact phase follows. "Our local contact introduces the candidates to the Belgian company to ensure that both parties are interested in a partnership. Once all these issues are clarified, the relationships can be rapidly explored in depth." 

SUCCESS IN THE FIELD

Every target market has its problems and risks: from the language to cultural and commercial differences. Very specific problems that are often difficult to solve from Belgium, especially in the post-COVID-19 era. Hence the importance of being surrounded by specialists who know the country like the back of their hand. Need an example? "To be able to supply retailers in the UK, you often need to be able to invoice at a local level", explains Rob van Veen. "Our trade developer can then act and take care of the local invoicing and accounting on the company's behalf at a fixed and transparent rate for each transaction. This is a simple initial structure that does not require major investments but is very interesting professionally." The client can naturally then seek its own local partner. "That too is a task they can leave to our contact person, who has the necessary experience to do so." Need another example? Russia, where everything takes a huge amount of time... Trade Development's network of experts can also speed things up considerably here and solve problems more quickly. 

 

Experts from 16 cities around the world shared their insights at the Sustainable Future Forum. In Brussels, we heard from Virginie Frémat, Senior Partner at law firm CMS, who specialises in ESG and corporate responsibility.

Environmental, social and governance (ESG) factors have moved from being a niche concern to a strategic board-level priority across all sectors and jurisdictions in a short space of time.

ESG implementation and reporting are no longer things companies do to be socially responsible: they have a legal obligation to embrace them.

From financial institutions to energy companies to tech start-ups, from small and medium-sized enterprises (SMEs) to publicly listed companies, all businesses need to focus urgently on ESG.

While the impact of ESG regulation is indisputable, the business and investment environment is opening up new opportunities and will continue to do so in future. Existing and future ESG regulation is about making people and the planet an integral part of a company's long-term strategy. This development creates opportunities for companies to do better for people and the planet, while creating greater value for investors. 

A changing playing field

Not only are governments becoming more demanding on ESG issues, shareholders and civil society movements are also making their voices heard. Consider the Urgenda Foundation, which took the Dutch state to court: it demanded that the government do more to reduce greenhouse gas emissions, and was successful. Whether the Belgian climate case can force the government to take action on climate change is currently being decided in the Court of Appeal.

The push for companies to adopt more concrete, measurable and enforceable ESG initiatives is coming from three directions: 

• Stakeholder activism
• European directives
• National legislation

Sustainable finance action plan

In March 2018, the European Commission launched its Action Plan on Sustainable Finance, which aims to:

1. Direct capital flows towards sustainable investments for inclusive growth
2. Manage financial risks related to climate change and social issues
3. Promote transparency and long-term thinking in finance

Key features include a single EU classification system (taxonomy), investor responsibilities, low-carbon benchmarks and improved sustainability guidance, all aimed at promoting a more sustainable financial future.

Non-financial reporting directive

To support the transition to a more sustainable economy, the European Parliament adopted the Corporate Sustainability Reporting Directive (CSRD) in late 2022. This is an extension of the Non-Financial Reporting Directive (NFRD), both in terms of the number of companies that have to comply with the standards and the number of topics they need to report on.

The NFRD came into force on 5 January 2023 and will eventually apply to around 50,000 companies. In the same way that companies are now required to carry out financial reporting, they will also have to report on sustainability. The largest companies will be the first to report, with smaller companies following later. On 3 September 2017, the Belgian legal system incorporated these requirements, which are now part of the Belgian Code on Companies and Associations.

Taxonomy regulation

The EU Taxonomy Regulation introduces a classification system for environmentally sustainable economic activities. Article 8 of this regulation imposes disclosure requirements on companies subject to the NFRD. These include the obligation to disclose the extent of a company’s engagement in environmentally sustainable activities and certain key performance indicators.

Corporate Sustainability Reporting Directive

Companies subject to the CSRD must include non-financial information in their annual management reports, covering environmental, social, human rights, anti-corruption, bribery and diversity issues. The CSRD also requires a brief description of the company's business model, policies, performance, key risks and non-financial performance indicators.

Sustainability reporting will follow mandatory EU standards: the first set of standards was published on 30 June 2023 and a second set with additional and sector-specific information will be published by 30 June 2024. Reporting must take into account the principle of double materiality, covering both how a company’s business is impacted by sustainability issues and how its business impacts society and the environment.

The CSRD emphasises the value chain, strategy, stakeholder interests, implementation of sustainability policies and progress towards sustainability goals.

It requires disclosure of due diligence processes, adverse impacts throughout the value chain, actions taken to mitigate such impacts, material sustainability risks and relevant indicators.

The CSRD has introduced comprehensive sustainability reporting requirements for large public-interest companies, so that they provide detailed and transparent information on their sustainability practices and impacts.

Corporate Sustainability Due Diligence Directive

This directive applies to large EU and non-EU companies. It requires them to carry out due diligence and to act on any findings. There are sanctions for non-compliance. The new civil liability regime allows direct claims by individuals who are harmed by a company's non-compliance.

For companies incorporated under the law of an EU member state, the CSDDD applies to companies with an average of more than 500 employees and a global turnover of more than €150 million in the last financial year. Alternatively, it applies if a company has an average of more than 250 employees and a global turnover of more than €40 million in the last financial year, with at least 50% of that turnover generated in sectors deemed to be high-risk. High-risk sectors include those involved in the manufacture of textiles, leather, agriculture, food, minerals and related trade.

In addition, the CSDDD introduces measures applicable to SMEs involved in the value chains of companies covered by the Directive, recognising the indirect impact on them.

I run an SME: what should I do?

Unlisted SMEs fall outside the scope of the CSDDD, so they are not directly subject to its provisions. However, SMEs with securities listed on an EU regulated market (excluding micro-enterprises) fall within the scope of the CSDDD, although they can opt out until 2012

. In addition, a specific set of EU sustainability reporting standards tailored to SMEs is being developed, which non-listed SMEs can adopt on a voluntary basis.

It is important to note that even if SMEs are not directly covered by the CSDDD, they may still be affected by it through their involvement in the value chains of larger companies. Both EU member states and companies within the scope of the CSDDD have an obligation to support SMEs in these value chains.

I’m a director: what does this mean for me?

The CSDDD has wider implications for directors of companies that fall within its scope. Directors have a fiduciary duty to promote the success of their companies, but they also face risks such as criminal and civil liability and sanctions, particularly if they are directors of listed companies. In addition, the focus on ESG and sustainability issues can lead to reputational damage. The CSDDD increases the regulatory burden on companies, both in terms of time and cost. There may also be a negative impact on share prices and the cost of directors and officers insurance premiums. Articles 25 and 26 of the CSDDD, which relate to the duties of directors of EU companies, remain subject to ongoing discussion and refinement.

Is technology the key to moving towards more sustainable business travel? Here’s what Philippe Kahn, Mobility Solutions Expert, thinks.

Now more than ever, businesses need to rethink mobility so that it forms part of the sustainable transition that needs to take place in our societies. Since 1 July 2023, the regulation meaning that company vehicles with combustion engines will no longer be longer tax-deductible by 2026 has started to have an impact. At the same time, Belgium’s Federal Mobility Budget and its recent developments are making this (r)evolution much more concrete and practical. And one thing is for sure: technology – and especially apps – have a key role to play. Philippe Kahn, Mobility Solutions Expert at Arval BNP Paribas Group, explains why.

1 July 2023: a key date

“In the few weeks that have passed since the pivotal date of 1 July 2023, we have already seen a change in the needs expressed by our corporate customers,” says Kahn. "Some of them had already taken practical steps towards sustainable transition. But nowadays, more and more of them also have to address the specific questions and concerns of their employees. How will I be able to use an electric car when I live in a city and have no charging stations available? Do I want to search for a reliable place to charge every day? And am I ready to fundamentally rethink how I get around? Providing a satisfactory answer to these questions is inevitably a priority for employers. As well as the end-to-end management of company electric vehicles – including the question of charging them – more and more companies are starting to rethink their overall mobility policy, analysing all existing alternatives, particularly multimodal solutions. And that’s great news, because it’s essential for their future. So I think the demand for such solutions is only going to grow. Technology, and apps in particular, are key tools for a smooth transition".

Anticipating change to serve companies better

Whereas this issue is only just emerging for many companies, it has been a priority for Arval BNP Paribas Fortis and Philippe Kahn for years. "For more than five years now, we have been anticipating the changes that are now taking place, ensuring that our vision of mobility and expertise go far beyond leasing. We now have an entire department that deals with these matters exclusively. This enables us to meet and even anticipate the needs of companies that have no experience of these issues, and who sometimes feel a little lost when it comes to this revolution in travel.”

A simpler, smoother experience thanks to technology

But why and how is technology playing an important role in this transition to more sustainable business travel? "It’s making the experience of new mobility easier and smoother for its users. And that's where the latest developments in the market are heading," says Kahn. "In fact, that's also what our new Mobility Arval App now offers our corporate customers. It makes it easier for employers to manage the mobility budget established by the federal authorities. This budget, its three pillars and recent developments are crucial factors when a company is rethinking its mobility. But at the same time, it involves some regulatory complexity. That’s why, five years ago, we started developing a whole range of technological tools to help companies deal with these matters. For example, we  make it simple for our customers to manage the combination of an electric car and bicycle within this mobility budget. In this spirit of innovation, and aiming to improve the user experience, our app integrates all facets of new business mobility, which are all accessible from a smartphone. Use of public transport, shared mobility, taxis, and even parking – even though this is not one of the pillars of the mobility budget – everything is in one place. The app also makes it easier to manage transactions: low-value mobility transactions, such as buying a bus ticket, are automatically captured and validated, so manual checks are no longer needed. Similarly, there is no longer any need to advance money to employees or reimburse them for anything, and no need for them to keep and present tickets or any other proof of purchase. In short, our app translates the entire mobility budget, which can be pretty complex, into a user-friendly tool where all the important components are taken into account: car, bicycle, scooter, multimodal solutions, public transport, shared mobility, etc."

Technology as a strategy accelerator

Arval Belgium’s innovations perfectly illustrate why technology is an important accelerator when implementing new mobility strategies. And it goes without saying that what exists today will evolve very quickly, leading to an ever-richer user experience. As Philippe Kahn says, "there are a lot of innovative tools out there already. But one of the challenges, linked to the complexity of the situation in Belgium, is to bring together all the players involved under the same umbrella, so that the result of this collaborative work can be found in a single 'magic' app. The solutions that exist today in Belgium are often local in scope. This is a limitation that doesn’t exist in the Netherlands, for example, thanks to their OV card.  Belgium’s urban planning realities are also a challenge:  outside the major urban centres, it’s less easy to set up mobility hubs in which all modes of travel are accessible."

One thing is certain: for companies, the transition to new forms of mobility is well underway. And the new Arval Belgium app is a valuable tool for those companies. “This technological innovation now makes it possible to mitigate the regulatory complexity for employers, and to make multimodal transport a very fluid experience for employees,” concludes Kahn.

Arval Belgium SA, Ikaroslaan 99, 1930 Zaventem – Registered with the Brussels trade register – Belgian VAT number 0436.781.102.  Company with an ancillary insurance brokage business, registered with the Belgian Financial Services and Markets Authority (FSMA) under number 047238 A. Subject to acceptance of your request.

Arval Belgium SA is a subsidiary of BNP Paribas Fortis S.A.

At the end of May, BNP Paribas Fortis and the University of Antwerp brought together a number of experts to discuss the many challenges involved in decarbonising the shipping sector. What are the key points to remember?

Established 12 years ago, the BNP Paribas Fortis Chair in Transport, Logistics and Ports - linked to the University of Antwerp - conducts in-depth research to find concrete and innovative ways of creating an increasingly resilient – and sustainable – maritime ecosystem.

Building on the success of its first two major events in 2017 and 2019, the Chair has decided to do it again this year. On 25 May 2023, a number of experts and stakeholders from the port and maritime transport sector gathered at the BNP Paribas Fortis premises in Antwerp to discuss the impact of decarbonisation on the maritime ecosystem.

Here are their main findings...

1 – We need to move up a gear

Shipping is currently the most carbon-efficient form of commercial transport in terms of CO₂ emissions per tonne and kilometre. But it can do better.

So far, industry players have favoured quick wins, such as modifying ship propellers and adjusting speeds. But on 25 May, the experts agreed that now is the time to experiment with new fuels and technologies, and move towards (near) zero emissions. The pace of change is accelerating, but there's no silver bullet yet. The costs (and risks) are huge.

2 – International regulation, please (and only one)!

The regulatory framework is complex and constantly evolving.

The International Maritime Organisation (IMO), which reports to the UN, is committed to reducing the carbon emissions from all ships by 40% by 2030 and by 70% by 2050 compared to 2008.

The European Union has committed to reducing greenhouse gas emissions from shipping by at least 55% by 2030, compared to 1990 levels. By 2024, an Emissions Trading Scheme (ETS) will apply to all ships of more than 5,000 gross tonnes sailing to or from EU ports.

In short: things are moving, and in the right direction. The problem, according to industry players, is that numerous regional and supra-regional programmes continue to coexist. This leads to administrative and financial overload.

On 25 May, all those involved agreed on two points: firstly, that a single international policy is essential, as this is a global sector; and secondly, that players who do not comply with the rules must be sanctioned.

3 – The transition to carbon neutrality will be costly 

The investments required to build new greener ships is estimated at $5 trillion by 2050. The cost of modernising the existing fleet is not yet known, but it will not be zero. In addition, the investment required to renew port infrastructures promises to be huge.

4 – Fuel and/or preferred technology: uncertainty reigns

What will be the fuel or technology of the future? Opinions are divided.

Many types of low-emission fuels are likely to coexist for some time. Electricity will only be used on coastal vessels, ferries and some tugs. Large ships will use liquefied natural gas (LNG) or liquefied petroleum gas (LPG), methanol, ammonia and possibly even biofuels.

Long-distance shipping will initially depend on heavy fuel oil, possibly with carbon capture and storage. Hydrogen has potential, but its density, storage and handling raise questions. Wind, solar and nuclear power are also in the mix.

But the real problem at the moment is that while the number of ships that can run on cleaner fuels is increasing, these fuels are not yet sufficiently available internationally. In other words, supply is much lower than demand.

5 – Banks play a key role

Banks have a key role to play in financing the energy transition. In 2019, eleven financial institutions – mostly European, including the BNP Paribas Group – launched the Poseidon Principles to support the transition to low-carbon shipping. This global framework makes it possible to measure and disclose the carbon intensity of bank loans in the maritime sector. There are now 24 signatories, including Japanese financial institutions. And that’s good news.

Want to know more?

Presentations, videos and photos from the 25 May event are available on this page.

A recently commissioned survey by BNP Paribas Fortis on mobility found that this remains a major challenge for the coming years. The bank is determined to play its part.

A survey among 2,000 people, and representative of the Belgian population, on mobility shows that the switch to electric driving is slowing. Almost 80% of those surveyed still drive a diesel or petrol vehicle, and more than a third of them have no intention of trading in their cars for a more environmentally friendly model any time soon. And yet almost 50% want to be driving electric by 2029. But before that switch, some hurdles first need to be cleared. According to two-thirds of respondents, the bank needs to take a proactive role in the transition to sustainable mobility.

• Only 10% of cars on the streets today are electric, hybrid or run on hydrogen. Users of these vehicles confirm they are very satisfied. Though most have their own charging station, public charging stations are a bottleneck.
• While fighting climate change remains the main argument for switching, changing mobility habits isn’t so easy. The switch to electric is slow, and more incentives are needed, such as new tax measures, and above all, a commitment from the government. Prices also need to come down. It is clear that the practical issues of driving and charging times mean people hesitate to make the switch.
• As a result, enthusiasm about new mobility initiatives is rather muted. Although, especially in big cities, an app that combines mobility options has good chances of success.
• Mobility and work are strongly linked. One in three people spend at least an hour a day travelling to/from work. It turns out that teleworking is a solution for only 50% of the people, and that the other half of the population don’t have the opportunity to work from home.
• More awareness needs to be created around new mobility. Not everyone is familiar with shared cars, bikes and charging stations yet.

Mobility partner

BNP Paribas Fortis is determined to contribute to more sustainable mobility and be a mobility partner for both professional and private customers. We are doing this by informing audiences of all the advantages of an environmentally friendly switch. And also by offering support through financing, insurance and leasing. Our goal is to provide a global response to tomorrow's mobility needs through innovative services.