5 Key Reasons Why your Business needs Compliance

Posted by: admin Category:
Organisation Compliance

Many businesses and startups don’t even know what compliance, let alone why it’s important is. On the whole, compliance is associated with audits, laws, inspections, penalties for those who don’t follow the rules. So, for that compliance is necessary for your business. 

What is Compliance and Where does it belong in the Organisation?

Compliance is a set of processes that ensures employees and organisation as a whole follow the internal rules of conduct and external rules and regulations. In large organisations, it’s included within the legal department. In medium-size companies, organisation compliance tends to reside within the functions of chief financial officer, head HR. In small organisations, compliance resides with the business owner and is mostly undocumented.    

You can Build trust with others

“It takes 20 years to build a reputation and about five minutes to lose one.” – Warren Buffet

Trust is developed with three elements, repeated interactions with another person, honest communication with that person and following through the commitments. Organisations need to ensure that they have adopted proper communications and proper follow-through before expecting commitments from their customers. 

Gaining a reputation as an organisation that does not meet its compliance can hamper customer loyalty and trust. Having a clear compliance program makes it clear to the stakeholders that compliance is the top priority. It shows the commitment to doing the business the right way and with proper ethical standards. 

Avoid Criminal Charges

One of the important reasons you need to make sure that your organisation is compliant to avoid any criminal charges. No business wants to be in a position where they can face potential criminal charges, why? Because they failed to adhere to the set law. There are various laws and regulations in place that dictates how a business will operate. Having a proper compliance kit in place and taking help from a compliance management company ensures that the company doesn’t break the rules and wind up issues.

Improved Public Relations 

When you have met the legal obligations, a benefit of compliance is your ability to tout these things on your website and within the marketing needs. For example, if you are placing any job advertisement, you can include that you are an equal opportunity employer. 

If you are writing the mission statement for your company’s website. And you can state that your business does not discriminate based on sex, race or creed. When recruiting new employees, you must highlight the company’s dedication to mental health by referencing certain policies and benefits that are dedicated to wellbeing. 

Attract & Keep the Right Talent

When a company is following a compliance program, it improves the ability of the organisation to attract and retain top-quality candidates. This helps to improve employee morale and retention rates. Job seekers are not interested in joining companies that don’t take compliance and ethics seriously. The more employees feel they work in a professional environment, the more likely they’ll stay with you. Even if you don’t discriminate against any employees, make sure none of your employees does, if they do, you can lose employees. 

Try including policies and procedures in your employee handbook that should represent legal compliance complications. Do remember, a system is strong when it’s enforced. The policy should specify the procedure dealing with infractions. Keep a regular check-in with managers to ensure every query is handled correctly.

Reducing Unforced Errors

Unforced errors are one of the common risks to organisational performance, but compliance helps to prevent unforced errors. Many people think about the risks in terms of outside forces can affect the organisation. What they worry about are the criminals, scam artists, economic trends. Yet most of the threats are generated internally. More than 90% of the effort in the best run organisations is waste that harms the organisation in the long run. In these cases, lean management can help out a company. They help to make the waste visible so that organisations can improve with time. 

Compliance can do wonders here. A healthy compliance function can help to make the waste visible, and by tracking core-metrics that shows areas of under-performance. It helps to prevent any disputes and misunderstandings. 

Elements of an Effective Compliance Program 

Leadership 

A successful compliance program must be built upon a solid foundation of ethical values; otherwise, it would be just a set of rules. Companies also have high-ranking compliance officers with resources to manage the program day-to-day.

How Upright can help

We help to develop board-level compliance training and customised corporate management retreats. 

Risk Assessment

Enforcement authorities in India are now demanding that multinational companies have formal processes for assessing the compliance risk everywhere they do business. 

How Upright can help

We perform on-the-ground risk assessments in a variety of challenging markets. 

Standards and Controls

It’s hard to find a company that doesn’t have a code of conduct. They must have established protocols for screening their partners, local agents for criminal backgrounds. 

How Upright can help

We develop codes of conduct, FCPA manuals & third party review procedures. 

Training and Communication

Technologies such as video conferencing have made it easier for companies to train their employees. But live training is the preferred method for the employees at higher risk situations.

How Upright can help

We develop training programmes that can be customised by industry and area of compliance. 

Monitoring, Auditing and Response

After, all the compliance controls have put in place & communicated to the appropriate audiences. Implementing this kind of vision is the weakest link in the company’s compliance program.

How Upright can help

We conduct compliance audits and help develop reporting and monitoring procedures. We also focus on the prompt response to detected problems via corrective actions. 


FacebookTwitterLinkedIn

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Articles