Achieving regulatory compliance is usually the difference between a thriving business and one doomed to fail. That is especially true for sectors with strong compliance oversight, such as financial services and cyber security, among many others. In its most basic form, regulatory compliance means complying with industry laws, regulations, and practices. Although every country and every sector has its own laws and practices, one thing's for sure: Proper regulatory compliance is a mandatory requirement for every business, and it can quickly become a nightmare with all the bureaucratic details.
Non-compliance is when a business or an organization fails to follow the industry rules, policies, or regulations required by the specific country and sector. Non-compliance usually yields costly results that include:
● Jail time
● Damage of reputation
● Penalties and fines
● Business closure
● Loss of market space
● Product delays
Examples of Non-compliance
● Failure to comply with sectoral regulations
● Failure to obtain the needed permissions or certifications
● Failure of data protection, health, and safety regulations, and environmental protection
● Tax and pension liabilities
It is the responsibility of the organization's management to ensure that their activities are conducted by the specific laws and regulations required. However, regulatory compliance has a bad reputation among businesses and organizations, as it is usually viewed as an unnecessary and costly amount of work that is imposed. However, achieving regulatory compliance increases efficiency and saves a huge amount of money in the long run only by avoiding potential lawsuits and penalties, which could be very costly, as mentioned above.
Achieving regulatory compliance, though it could seem like some unnecessary amount of work, would be highly beneficial for any organization, even without taking the avoided fines and lawsuits into account. These include:
● Avoiding and limiting data breaches
● Efficient data storage
● Preventing any potential financial losses
● Avoiding costly penalties, fines, and lawsuits
● Avoiding breach of trust
● Preventing loss of market space
As mentioned above, it is the management's responsibility to follow the rules and regulations required by the law closely. That shouldn't be a problem if your company has the strength and the resources to do that. But if you're a small company with limited resources to spare, that could easily turn into a nightmare and bring an end to all your dreams and hard work. To avoid that, you should make sure to follow these best practices:
● Get your facts together - Closely inspect the mandatory rules and regulations your company should adhere to. Knowing what and what not to do should be the first step.
● Hire compliance officers - Compliance officers are in high demand right now, for a good reason. Compliance officers will help your company to keep current with the always-changing rules and regulations, coordinate and update the existing policies accordingly, and conduct compliance audits. Though they might be costly, in the long run, it's better than those potential penalties and fines.
● Train your employees - At the end of the day, your employees' actions are bound to your company. Make sure that they know what they should and shouldn't be doing. Keep them up to date.
● Constant improvement is the key - Always keep an eye on your weaknesses and take swift action to minimize those.
The responsibility to closely track your business operations and make sure that they are in accordance with the mandatory rules and regulations is a huge responsibility and definitely a tough one. Only some businesses or organizations have the needed resources to spare for this task, and the results could be costly. Using compliance management software, also known as a compliance tool, might be a good option.
But what does compliance management software do? Well, to begin with, a good one will help you with the following:
● Risk management
● Centralize and automate all working process
● Reducing legal problems
● Enhancing efficiency and corporate integrity
● Increasing brand and company reputation
● Effective team communication
● Training your employees by raising instant awareness of any potential issues
● Optimizing and regulating your operations in accordance with competition law and regulatory compliance
● Protecting the privacy of your employees
With all of these and many more, good compliance management software will help elevate your organization to the next level by preventing potential non-compliance issues and avoiding unwanted penalties by the competition authority.
To sum it up, achieving regulatory compliance is an absolute must if you wish to operate at the highest level. Though admittedly, it might seem like an unnecessary amount of work and a burden that will drag you down, the results of non-compliance could be costly. While ensuring that your organization is taking the right steps to achieve regulatory compliance, proper compliance management software will be your biggest ally.
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