People may argue that compliance or satisfaction the clientele is the most important part of business today. Many other factors may be just as important, even though they aren’t immediately considered. For example, after the initial idea for a business, the entrepreneur of this business wouldn’t be able to organize until that founder is aware of specific required licenses, the type of company that will need to be formed, or even the location of the company without making sure it is compliant with all of the rules and regulations.
Compliance or fulfillment of the potential client’s desire is often forgotten, passed off to an office assistant who is assigned to do research to fulfill this objective.
As a company expands and grows, attention to effective compliance must grow with the company. This objective leads to hiring more people to help obtain this goal of compliance.
How can the CEO of this expanding company be sure of whom to hire?
Hiring a lot of new staff can add up and become expensive for the company’s owner. CEOs of companies who find themselves in this situation should find and employ people who can research and provide resolutions by processing complex thoughts into viable outcomes.
Compliance as defined, is simple: It is making sure you follow the rules. What isn’t simple is the interpretation and creation of the rules. Compliance can be broken down into two areas.
The first of these two areas is Regulatory Compliance. Regulatory Compliance is making sure that any action conducted by a company is within legal parameters and/or that all “reasonable” actions have been taken in order to prevent negative incidents. The steps in this risk management include risk mitigation; signage disclosures, processes like Know your Customer and Customer Identification Procedures
The second section is Internal Compliance. This section is referred to by a variety of names but no matter what this section is called, it always involves a focus on internal policies and standards to ensure that the company operates according to it’s original intended culture. To ensure that Internal Compliance is met, a good rule of thumb is for a company to set interna standards even higher or more demanding than the regulatory standards. “CYA,” for example: If
a law states visitors must wear hardhats in a certain area, then a company should set company standards so that se that access to that area is off limits to visitors entirely.
The other reason that compliance is the most important part of a company is to avoid litigation. Adhering to regulatory standards and rules can and should provide evidence that all necessary and reasonable actions are taken in order to prevent negative incidents from occurring. This should protect a company from any and all liability in court.
This relates to everything from lawsuits to criminal investigations.
If someone were to injure themselves while in a company’s vicinity, it should be evident that there are proper policies and actions in place to prevent such an accident so that said accident would not be blamed on the company.
If compliance is handled properly then a good portion and a base for risk mitigation is in place.
Insurance premiums can be lower. As a rule, the need for insurance is because of a lack of internal compliance.
With many new regulations that have come about in the past decade, compliance is now the most important part of a business and is beginning to be too much for a single lawyer to handle, even if they are a full time employee.
Items that fall under compliance:
- Hazard signs
- Wheelchair access
- Accessibility, blind, deaf, etc.
- Instructions in multiple languages
- Wording in marketing
- Food safety
- Tax filing
And MUCH MUCH MORE!!