Importance of compliance management

Compliance is no longer an issue that only affects large and often public companies. Even small and medium-sized companies must consider and comply with the compliance guidelines. Because the legislator makes no distinction here depending on the size of the company, compliance violations can also cost small and medium-sized companies their existence.

Although awareness of compliance has developed in many small and medium-sized enterprises (SMEs), there has been skepticism about this topic and the introduction of a compliance management system.

Companies often lack human and financial resources, know-how, and the necessary organizational structures and processes. In most cases, however, implementing good?compliance management ?is easier and pays off in many ways.

The following can be achieved with the introduction of a compliance program:

• Ensuring lawful behaviour in the company.
• Protection of the company and employees from fines or imprisonment.
• Reduction of reputational risks for the company.
• Increasing attractiveness to clients, major customers, investors, and employees.
• Control & early detection of risks and violations.

It is not only the image and reputation of a company that can be damaged if a compliance management system is missing but real financial losses as a result of rule violations in the form of sensitive fines are no longer a rarity.

In addition, more and more large companies are only entering into business relationships with companies that have a sustainable compliance structure for fear of possible damage to their reputation. A lack of compliance can also cause sensitive business disadvantages.

The costs of a good compliance management system almost always pay off

For most companies, it might make sense to involve external consultants when creating a compliance management system. A company should spend some money for good compliance as it is guaranteed that it will pay off in the future.

A few tips on how to become a compliant company:

To approach the topic of compliance in a medium-sized company, one should first carry out a systematic survey of the compliance risks.

Raising employee awareness

Employees play a crucial role when it comes to the successful implementation of compliance. It is therefore important to provide employees with sufficient information and raise their awareness.

Training sessions in which the goals and requirements of compliance measures and guidelines are explained are suitable for this.

Introduction of a whistle-blower system

The establishment of a whistle-blower system in the company enables employees to anonymously point out rule violations. This not only gives the employees a feeling of security but also serves as a preventive measure for the entire company.

In conclusion, it can be said that compliance has long since ceased to be an issue only for large corporations but should now be at the top of the agenda of young, small, and medium-sized companies. With the right experts, compliance is an investment that pays off.

This content is meant for information only and should not be considered as an advice or legal opinion, or otherwise.?AKGVG & Associates ?does not intend to advertise its services through this.