In financial and investment management, compliance is a crucial part of running any type of organization. As regulations change and evolve, it’s critical for every company to stay up to date on necessary compliance. To achieve that goal, companies must have strong regulatory change management systems set up as part of their overall operation. It’s an integral component of any company’s compliance efforts and ensures the company is ready for any potential new regulations set forth by government (or other) agencies. It also helps organizations quickly adapt when regulations change. Moreover, it helps you stay compliant with existing regulations and prevents you from finding yourself in a state of non-compliance. Here are five key items that every company should have in place to meet the regulatory challenges that can face today.
Understanding Regulations In Your Industry
The first step in managing regulatory changes is understanding what regulations apply to your company as a whole. Most industries are not self-regulating and require knowing the ins and outs of how things are supposed to work within their operational frameworks. That means understanding how regulations affect your industry, how to apply them broadly to your organization, and knowing which regulations will have an impact on your company going into the future. Regardless of where you work, regulations and compliance are going to look a bit different from industry to industry. Telecommunications regulations are going to be quite different from financial industry regulations for instance. Strive to understand which laws and regulations apply directly to your customers, organization, and stakeholders. Figure out which specific federal and international laws apply directly or indirectly to your business. Finally, you need to be aware of which regulations might likely impact your company in the future. Check out any pending legislation that could affect how your business operates so you can prepare and aren’t blindsided by potential changes. The last thing any successful organization wants to do is be reactive when a little bit of proactivity and understanding can go a long way toward remaining compliant across the entire company.
If you’ve been running your business for quite some time or working in your particular industry for a while, then you understand the importance of compliance. At its core, compliance is just the process of ensuring policies and procedures are being properly followed and consistently used throughout the organization. Rules aren’t necessarily set in stone without any malleability. They’re merely a consistent guideline and regulation that needs to be followed, often in a way that can withstand legal scrutiny or follow up by a regulatory agency. Compliance is pretty important across the board. Compliance helps protect you from lawsuits or government penalties if something goes wrong. It also effectively enables an organization to operate efficiently. There are fewer instances of wasted time, energy, or trying to figure out how things are supposed to work. It also encourages customers or shareholders to invest in a company that stays in compliance at all times. By remaining compliant and following proper procedures, a company can be more successful and make everyone happy while doing everything the proper way.
Monitoring is an essential aspect of Regulatory Change Management that helps you identify how well you’re doing, what might need to be changed, and identifying what’s working (and what isn’t). Monitoring allows you to track progress and detect any issues along the way. Monitoring can include reviewing compliance status reports, monitoring alerts, checking notifications from regulators/vendors, or reviewing data you get from third-party tools. Monitoring is rendered easier by using some types of tools, including artificial intelligence-based resources that can help you follow all pertinent regulatory change management protocols for your industry. The goal of monitoring is to determine whether your organization is in compliance with all regulations or not, at all times. So take the time to make sure your monitoring is up to par and you’ll be able to retain compliance without too much difficulty over time.
Auditing involves conducting regular reviews of how well your company’s regulatory change management process is working so far (or not, which can sometimes be the case). Auditing can involve evaluating documentation or real-time changes that have been made to various policies and procedures over periods. It can also mean taking some time to thoroughly examine your internal company processes. Searching for the effectiveness of employee training programs might fall into this category or checking how cost-effective your regulatory change procedures are for your company. Whether you’re poring over reports, conducting surveys, or engaging in various risk management protocols. Audits improve the strength of compliance efforts, making them an invaluable tool for your organization’s mission to be consistently compliant at all times.
The importance of effective compliance is undeniable, but it’s not always easy to set up or maintain. That’s why you need reports that create evidence of your compliance standards. Part of your plan for regulatory change management should involve robust reporting procedures and a little bit of extra training for your employees. Financial reporting and understanding your reports are key to proper compliance. Establish compliance programs that include monitoring, auditing, and extensive reporting processes. It’s also a good general policy to address any whistleblower protections, required ethics training, or any other best practices that can help your company succeed where it matters most. Ultimately, it’s important to ensure all employees are aware of current regulations within the industry and are doing what they can to ensure regulatory compliance standards are set up, checked, and working 100% of the time at your organization.
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