Meeting regulatory body determinations for the sector, complying with tax obligations, adapting to technical standards, achieving accounting compliance — these and other requirements are part of running a company. When this does not occur, the company is subject to penalties. However, balancing these variables is a major challenge that must be faced by compliance management.
Does your organization invest in this management? Learn more about the subject in our post today!
What is compliance?
Originating from the English verb to comply (to fulfill, satisfy, perform, or execute what is imposed), the word compliance means the obligation to comply with and supervise compliance with internal and external regulations, rules, and guidelines established for the business.
This adaptation of the company to the impositions of standards required for the segment applies to various sectors of an organization: labor, accounting, tax, environmental, legal, social security, financial, ethical spheres, among others.
Importance of compliance management
Compliance management is essential for business success because it allows a company to achieve greater strength in its strategic objectives, respecting all involved legislations and standards.
Compliance with rules and regulations, whether internal or external, also brings benefits to the company. Check out some of them:
- Quality: adaptation to quality standards makes the service or business activity present a superior standard;
- Savings: by avoiding fines, punishments, legal charges, and penalties for failing to meet specifications, companies benefit from saving financial resources;
- Brand strengthening: by fulfilling requirements, the company becomes known as a serious, ethical, and committed organization.
- Access to external markets: efficient compliance management generates credibility in the international trade arena;
- Favors corporate governance: allows greater control of processes and operations;
- Avoids friction: a company that fulfills its legal and contractual obligations will have fewer lawsuits due to non-compliance with laws, failure to report to regulatory bodies, breach of environmental laws, or even failure to honor agreements.
How to align processes with requirements?
After understanding the importance, it is time to conform the company to the standards. To do this, some tips are important:
- Draft a code of conduct that is simple and understandable by all employees;
- Be attentive to laws related to the company’s universe and their changes;
- Disseminate the importance of following procedures to all employees;
- Ensure that managers set an example regarding compliance with rules;
- Manage internal controls, supervising to ensure procedures are executed according to instructions;
- In addition to adapting to technical standards, develop continuous improvement projects and make employees aware of the ethical depth of compliance and that this ideology needs to be incorporated into everyone’s behavior;
- Perform periodic audits;
- Review hiring and people management policies to ensure recruitment attracts professionals with a vision compatible with the organizational culture;
- Monitor measures related to information security with the IT area;
- Make public the company’s stance of not engaging in immoral acts. All relations with clients, suppliers, employees, and any partners must be guided by this ethic.
- Use technological solutions that ensure compliance with regulatory bodies and current legislation.
In short, compliance is the practice of ethics and excellence. Valuing it is guaranteeing the preservation of rights, quality, fairness in commercial relations, and credibility before society and other bodies.
Did you understand the importance of compliance management? What are the biggest challenges your company faces in adapting to standards? Share your experience with us in the comments!
