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  • What is Regulatory Compliance - An Overview

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    While being launched in 2018, the GDPR (General Data Protection Regulation) took most businesses that have a market in the EU by surprise. It challenged the privacy and data protection responsibility that businesses transacting in the EU had to their customers. Out of the blues, companies that hadn’t cared about how well they stored customers’ data had to change their policies to be in line with the GDPR.

     

    That’s what regulation does to the business world; it sets a standard that protects the interests of the different stakeholders. When your business complies, on the other hand, you can not only eliminate the repercussions of non-compliance but also earn your client’s trust. However, compliance isn’t as easy as snapping your fingers, and it needs you to approach it with a robust regulatory compliance strategy.

     

    Here is some more information about compliance and how to keep everything in check:

     

    What Regulatory Compliance Really Means

    Regulatory compliance is the aspect of a business trying to conform to regulations. This includes both remaining compliant to both internal and external requirements. For instance, internal requirements might consist of having a strict policy on the indexing of documents in your database. It should be a priority for the leaders to ensure that such requirements are met.

     

    External requirements, on the other hand, are more far-reaching and are meant to protect the interests of key stakeholders. For instance, the data retention policies in the health industry ensure that customer data can be accessible even after five years.

     

    The Costs and Benefits of Compliance

    The initial investment in remaining compliant often comes with a high price tag. For instance, businesses might need to invest in access control systems to remain compliant with their industry’s specifications. However, non-compliance is a tad more costly as it can lead to not only reputational damage but also hefty fines from the regulatory bodies.

     

    There are even more reasons why regulatory compliance is essential. It allows your business to function in the set industry standards. As a result, other companies and clients can feel safe conducting business with you. For instance, the GDPR makes customers feel safe that their data will not be used for malicious activities.

     

    The hefty fines that come from data breaches might also make businesses shy away from such activities. Other than solidifying your reputation, remaining compliant can also protect your business’ data and intellectual property from falling into the wrong hands.

     

    Challenges to Remaining Compliant

    Most businesses must try and remain compliant with more than one law. The more the business’ market gets diversified, the more regulations it must follow. For instance, a company like Coca-Cola must comply with international regulations, environmental conservation laws, and the labor laws in the different countries that it does business in.

     

    The challenge comes in visualizing your compliance landscape. Without enough insights into what you need to comply with, a lot of requirement can be overlooked, often resulting in substantial fines. Ideally, your business needs a system that will make it easy to remain compliant.

     

    Picking the Tools of Trade

    You will typically need to evaluate and understand the aspects of your business that make compliance tough. For instance, you might have a limited in-house storage space to comply with the data retention policies in your industry. Once you manage to identify these weaknesses, the next step is to monitor them.

     

    Often, investing in compliance automation tool will be wise. Not only will it make it easy to track compliance requirements, but it also streamlines compliance record keeping. As a result, auditing your business will also be quite easy with such a central data storage location. Put, auditors will only need to log into the system to check whether you have been abiding by the set requirements.

     

    Automation also streamlines business processes. For instance, it becomes quite easy to send out email reminders to members of the business who are yet to respond to your compliance officer’s requests. In comparison to the conventional method of living memos and emails, automation will give you an edge in that you can automate such reminders.

     

    Develop the Business with the Future in Mind

    Regulations are bound to change with time, with more refined requirements being produced daily. On the other hand, the introduction of disruptive technologies into the business world often calls for the introduction of new laws to regulate them. For instance, the introduction of IoT devices will need businesses to concentrate on improving the security of these devices, which often have security features as an afterthought.

     

    As a result, as you introduce new concepts into your business, you need to consider both the present and the future compliance landscape. Ideally, you should build new business concepts with enough flexibility to adapt to the new regulations. Otherwise, you might have to incur hefty fines once an idea becomes too tough to run under the new regulations.

     

    With compliance taking center stage in business processes, your business can grow without worrying about being on the wrong side of the law. It also becomes easier to draw in customers who are interested in working with compliant businesses. Focus on using compliance tools to remain compliant and fortify your business from common threats.

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