Regulatory change can present challenges and risks for entrepreneurs. These risks are more pronounced for businesses in the early stages of their life cycle. As the businesses expand into new territory or offer new products and services, the number of rules that apply may increase and sometimes may actually contradict one another.
In the year 2018, companies have to be proactive with respect to their planning and engrain the culture of compliance in the business itself. Gone are the days of post-facto corrections and implementations as by that time the irreversible damage has been done.
Below are a few things that companies can do to keep the situation under control-
Compliance integration with other departments
Gone are the days when compliance was the responsibility of some departments. In today’s world, it’s critical to have each and every member of the organisation committed to the compliance strategy. It needs to be an embedded culture versus just a process. That’s precisely the reason why companies are either hiring the Compliance officers at the leadership level or as we suggested in our last article they are outsourcing the work to professionals like Argus.
In order to help carry out the vision at the company, your compliance team needs to be fully integrated with other workgroups, to ensure the best support possible for preventing costly errors. By doing so, companies can avoid the kinds of mistakes that even giants like Volkswagen have made due to a poor compliance culture. This has been well documented in various forums so we will not delve into it. The point to note is that this failure of compliance caused them USD 2.8 billion in criminal fines.
New Compliance platforms to the rescue
Anyone who has managed compliance knows that the accompanying technology is frequently inflexible, and that legacy software may not meet the unique needs of the business. Today more and more companies are turning to platforms that can house all of their compliance data and management efforts in one place. Platforms like GAN Integrity are built on the premise that compliance efforts should be more visible to the entire team, in order to keep key players in the know, even as they digitize time-consuming document management. As companies gain access to better compliance technology, they may be able to detect and solve problems sooner.
Proactive measures to take care of potential risks
Compliance related scandals frequently end up costing companies millions in lawsuits and government penalties, while damaging their reputation with customers, business partners and the general public. The sad thing is, most of the problems involved are completely avoidable. In order to avoid such blunders, companies need to think about the problems that might arise long before they become reality. One of the best ways to do this is by preempting the regions your business might grow into in the coming year. Also, question whether or not you anticipate any employee relations challenges. Think about the impending regulations and pick up on trends in the region. Just because something hasn’t yet been signed into law doesn’t mean that it won’t be soon.
By empowering compliance teams to be a more integral part of operations, companies can develop a stronger culture that will help prevent mistakes, protect employees and respect the rules in regions where they operate. Further, a compliance culture needs to be embedded integral part of every member of the organization.
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