As an SME that is scaling up and expanding internationally, legal protection is highly important. When scaling up, you will want to both ensure that you have the capacity and human resources to include the legal department. Legal protection may come in many forms for SMEs. It can be commercial arbitration, contract reviews, where it involves keeping in house counsel or a legal team for larger SMEs, or where you need assistance with mitigating risks, managing HR, or many other situations in order to protect your SME. Up4Scale readers would have certainly considered these issues and implemented best business practices to avoid disputes and legal issues. However, we will discuss dealing with negligence and how to prepare for lawsuits and mediation. This article will be covering a solution to what you might consider malpractice or negligence in the corporate world. SMEs may seem small and not have a high volume of sales, but as they scale, having the practical support systems in place to deal with issues such as past incidents can be highly critical to their long-term success. The negligence we will be discussing, as explained in the promoted article is negligent behaviors and variety of ways in which they can have negative impacts on SMEs. The legal way to address these issues is through civil legal means, whereby the victimized company can bring a lawsuit for damages against the company who caused them harm to their essential functions, operations, and reputation. Having the practical tools and knowledge to manage and deal with these legal issues is important for SMEs to be able to deal with incidents of negligence and intentional malice.

Negligence in this context is defined as when a victim’s rights have been violated by a company that acted either in a careless manner or intentionally did not follow local laws or regulations and caused harm to people or community members. Although the word negligence has a negative connotation to it, according to the Law Journal Newsletters in “Negligent Givings, Hyperethics, and the Problem of Regulating Professional Conduct in the Age of Moral Indeterminacy” Wong et al. (2019), business ethics makes sense of morally questionable actions within the workplace when employees are asked to act against their moral principles. The company would be found liable for damages caused either intentionally or through intentional negligence. An example of negligence is when an organization fails to supervise its employees. The organization will be found liable for the negligence of its employees. If a company that is scaling up and expanding internationally within the restaurant industry has a worker that is serving excess alcohol to customers and the company fails to implement policies to prevent the acts of negligence, then the restaurant may be found liable for the actions of their employee. Another example is when a restaurant fails to serve customers a product or service, which has not been inspected by health and safety, such as mold and contaminated products.

It is understood that SME’s often are underfunded and cannot afford legal assistance. A practical solution is to establish a compliance strategy with local regulations from the beginning to help mitigate your risk in the long-run. The difficulty is that when you expand internationally, legal protection and compliance can be harder because you are subject to foreign laws and may not have a legal and business model that aligns with foreign regulations and laws. Nevertheless, these are the best individuals or teams of lawyers that can help you to understand your country’s legal protection, compliance and deeper issues to protect your business. For more information about how to protect yourself in the long-run, please review our UP4Scale article on risk management as it relates to scaling internationally.