"One of the key components of an effective compliance system is a strong compliance culture through leadership commitment"

Could you describe what makes an effective compliance system?

Multiple factors need to be considered when building an effective compliance system that ensures adherence to regulatory requirements and maintains operational integrity.

Key components of an effective compliance system are:

• Strong compliance culture through leadership commitment.
• Comprehensive risk assessment including but not limited to financial and regulatory risks and a mitigation plan in place.
• Compliance policies to suit the Company and its processes.
• Adoption of tools and technology to achieve compliances.
• Regular monitoring and tracking of compliances through these tools.

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What is a common compliance issue companies like ours face and what according to you is the best way to handle it?

A common compliance issue that companies like our face is?keeping up with ever-changing regulatory standards.

The following steps can be implemented to address the issue:

• Conduct regular trainings and update employees on the new regulations and compliance requirements.
• Automate compliance monitoring through systems that generate update alerts and also help ensure that compliance measures are adjusted promptly, reducing the risk of oversight.
• Establish a dedicated compliance team.
• Conduct frequent internal audits to assess compliance within existing regulations and identify any gaps in the processes.

What are your recommended best practices for ensuring that the organization is compliant?

Here are some of the recommended strategies to ensure an organisation is compliant and growing:

• Encouraging employees to adopt a culture of compliance and sense of responsibility
• Documenting and updating policies and standard operating procedures that are a guiding path for all the stakeholders.
• Utilizing advanced compliance tools including artificial intelligence, integrating APIs and data configurations in the data warehouse for auto-generation of information with accuracy and eliminating human intervention.
• Continuous monitoring of implemented processes and policies to address issues pro-actively
• Encouraging open communication with all critical stakeholders which helps in constant improvisation.
• Seek expert advice beyond in-house resources via training and knowledge sessions.

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How do you prioritize risks when developing a compliance management plan?

Regulatory and compliance risk are extremely critical to an organisation and any lapse could lead to cancellation of license or registration certificate along with attracting hefty penalty impacting the reputation and goodwill of the Company. Steps to prioritize risks in compliance management are as follows:

• Compile a list of all applicable laws, regulations, and industry standards that impact the organization.
• Connect with various stakeholders across various departments to gather insights on compliances and have a holistic view of potential risks.
• For each risk, identify the impact and the likelihood of occurrence.
• Categorize the risks into high, medium, and low.
• Implement mitigation plan for each risk identified above.
• Monitor the risks regularly.

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How do you see compliance’s role in the development of our organization’s new products and services?

Compliance can contribute to the development of new products by offering solutions that maximize product offerings and adherence to regulatory standards while fostering innovation. Here’s how compliance can influence product development:

• By providing essential guidance on the regulatory landscape, helping product teams understand the laws and regulations including interpretation of laws.
• Identifying potential compliance and financial risks associated with new products and making informed decision on the forthcoming risks.
• Playing a critical role in monitoring regulatory changes and adapting products accordingly along with ensuring that the product remains compliant throughout its lifecycle.

Disclaimer:

The views provided in this blog are of the author and do not necessarily reflect the views of Vivriti. This article is intended for general information only and does not constitute any legal or other advice or suggestion. This article does not constitute an offer or an invitation to make an offer for any investment. ?