Why compliance needs a change of image

Clive Stringer, Business Development Director for Pitney Bowes, argues that it’s time for a rethink on compliance. Compliance, like death and taxes according to Benjamin Franklin, is unavoidable. Synonymous with rules, regulations and restrictions, it’s not a word that generates great excitement. Just staying aware of new regulations is a challenge in itself: in 2014, there were 40,000 regulatory compliance updates¹ and when reported, last year’s figures are likely to be similar. Data breaches are hitting the news almost every day, financial institutions are being issued severe warnings, and regulators are handing out record fines for non-compliance.  In the print industry, the stakes are especially high – an inaccurate billing run could lead to sensitive financial data in the wrong hands, or to personal medical records being sent to the incorrect address.

But perhaps it’s time for a rethink. Perhaps it’s time to embrace what can’t be changed and get the best from the situation? Compliance shouldn’t just be about box-ticking and avoiding fines – after all, regulations are in place to boost our economy, to protect businesses, employees, customers and suppliers. The benefits of best practice compliance go beyond keeping the regulator happy, so let’s take a look at the brighter side of compliance.

Businesses with robust compliance:

1. Perform better: there is a proven link between best practice compliance and business performance. More compliant firms enjoy greater Total Shareholder Return²
2. Are more responsive: compliant companies can respond quickly, to take advantage of market changes. They are best placed to respond quickly to change and take advantage of disruptive technologies and new market opportunities. Having the right technology, people and processes already in place removes the need for businesses to rush through operational changes to respond to requests for quotes
3. Have higher staff retention rates: building a culture of integrity to generate compliance fosters loyalty and belonging, and contributes to longer retention dates; conversely, it follows that companies trying to recover after a data breach experience low morale and high staff turnover. Companies with detailed compliance training programmes educate staff and give them a sense of responsibility and understanding
4. Benefit from improved communication: compliant businesses benefit from improved communications and a collaborative culture, as different business units work across the organisation to address requirements and share data and insight, rather than taking a siloed approach
5. Have greater security, risk management and business continuity: a focus on compliance with industry standards such as IS27001, for example, places security processes and procedures under the microscope. Once adhered to, these regulations provide a watertight foundation for a business
6. Are more ethical: business and consumer customers choose to do business with a company with a conscience. Compliance with environmental regulations such as the UK’s Energy Savings Operations Scheme shows transparency and integrity; with consumers as ‘citizen journalists’, sharing opinions in digital media, it has become more important than ever to demonstrate responsibility as a business, as empowered consumers choose to give their custom to fair-trade, ethically-sound organisations
7. Protect their customers: customers feel safe with a compliant business. Transparent compliance with constantly-evolving data protection regulations demonstrates their sensitive information is in safe hands. And more suppliers want to do business with compliant organisations: adhering to financial regulations, for example, reassures them, and they know they’ll get paid
8. Have streamlined business practices and processes: organisations taking a thorough and detailed approach to compliance benefit from more integrated and efficient business processes
9. Develop a deeper knowledge and understanding of customers: compliant companies are more likely to know their customers better – and who they’re doing business with. For the financial industry, Know Your Customer and Anti Money Laundering regulations must be adhered to. The right software pulls together data from across an organisation and generates the ability to create a Single Customer View, protecting the institution from fraud but also driving customer engagement and revenue
10. Generate better productivity: smart technologies implemented to drive compliance also improve productivity. Physical and digital technologies such as those with built-in document integrity techniques such as OMR or barcodes address drive compliance whilst also improving efficiencies.

 

There are clearly business benefits to compliance that go far deeper than adhering to industry regulations. It’s time for businesses to take a new, positive approach to compliance: to be transparent about compliancy, and focus on the strong competitive position it gives them.

¹ Source: https://risk.thomsonreuters.com/infographic/top-compliance-trends-for-2015

² Source: http://www.icmacentre.ac.uk/papers/the-uk-code-of-corporate-governance-link-between-compliance-and-firm-performance