If you are an owner of a small or medium business, you probably would have heard the term ‘corporate compliance’ at least once. But what exactly is it? And how does it affect your business? We discuss all this and more in our blog.
Simply put, corporate compliance can be defined as the way firms, businesses and organisations ensure that they are following all the rules and regulations. And yes, it is very effective. While it involves many aspects, some of the most basic ones include designing, implementing and monitoring all practices, methods and training. Corporate compliance plays a crucial role in your business regardless of which industry your business is in.
Corporate compliance covers both, internal as well as federal laws and regulations. But why is enforcing compliance in a business important? Enforcing it is important as it helps your company first detect and thereafter prevent any violation of rules thereby protecting it from lawsuits.
Even in corporate compliance, there are many different risks included. Here are some of them:
Corruption
As can be understood from its name, companies must introduce processes that prevent bribery, corruption and other wrongful business practices.
Reporting
Businesses are required to file correct financial statements and other reports to regulators at specific times in a detailed manner.
Data Protection
In this day and age, data plays a vital role in every business. Businesses must try to keep all the customer and personnel data safe and avoid any breaches of privacy.
Employment
Another crucial risk that is covered under corporate compliance is maintaining ethical workplace practices. Some of them include fair compensation, anti-discrimination, anti-harassment, etc.
How Does it Impact Businesses?
Now that you have understood what are the risks that come under corporate compliance, it is also important for you to learn how it impacts businesses.
Leaves Your Business Open to Legal Action
Failure in meeting corporate compliance standards can result in your business being open to major risks. It can leave your business open to several legal actions such as lawsuits. Additionally, keeping your company in the right side of law can have several benefits as well. In case, your company violates a rule in the future, a compliance program can turn to be their aid in the court.
Maintain Reputation
Corporate compliance can also help your company maintain its reputation in the industry. However, a poor reputation can hurt your chances as people will cease to believe in the legitimacy of your organisation.
Final Thoughts
Now that you have understood how corporate compliance affects businesses, you may probably wondering as to how you can manage all this. This is where a platform such as Dun & Bradstreet Onboard comes into the picture. It helps you with global coverage, i.e., keep a continuous track of all the entities to ensure that all compliance with global regulations and sanctions are met.
Not only that, it can further aid you in making crucial business decisions. It helps you uncover all the hidden risks of any potential company that you are planning to enter in a partnership with. So, sign up to D&B right away!