Compliance Policies & Procedures

What are compliance policies & procedures?

Compliance policies detail the laws, industry regulations, and government legislation around managing your business, employees, and customers. 

Compliance policies and procedures examples

Compliance policies include: 

• Human resources policy

• Financial services policy

• Data security policy or privacy policy

• Workplace safety policy

They may vary across jurisdictions and can be broadly categorized as:

• Internal policies: Key company-specific policies, codes, standards and controls

• External policies: Federal, state, and applicable local laws and regulations.

What is the purpose of compliance policies?

Adherence to corporate compliance policies safeguards your company against legal and financial consequences by:

• Reducing the risk of penalties, fines, lawsuits or shutdown of your business.

• Educating your workforce on best practices and approaches to resolving unethical or unlawful practices

• Helping to create a healthy work environment, leading to higher worker productivity

• Creating a positive public image of your company.

Why are compliance policies & procedures important for an event tomorrow?

Compliance policies benefit your company by:

• Building a positive image of your company that is useful in the event of a deal like mergers & acquisitions.

• Ensuring you are complying legally with all relevant laws and regulations

• Helping to build company morale and employee loyalty.

How do you develop compliance policies & procedures?

1. Identify applicable laws and regulations

Determine the laws, regulations, and industry standards that are relevant to your organization. Understand the specific compliance requirements that need to be addressed.

2. Establish a compliance team

Create a dedicated team or identify an individual to be responsible for developing and implementing compliance policies and procedures. They should have a good understanding of the relevant laws and regulations.

3. Conduct risk assessment

Perform a comprehensive risk assessment to identify potential areas of non-compliance and associated risks. Evaluate the impact and likelihood of each risk to prioritize your efforts.

4. Develop clear and comprehensive policies

Create clear, concise, and easily understandable policies that outline the expectations and standards for compliance. Address specific areas such as ethics, data protection, anti-corruption, conflicts of interest, and any other relevant compliance areas.

5. Involve stakeholders

Engage key stakeholders from different departments and levels of the organization in the policy development process. Gather their input and ensure their understanding and buy-in to increase compliance adoption.

6. Tailor policies to your organization

Customize policies and procedures to suit the specific needs, culture, and structure of your organization. Avoid using generic or copied policies that may not align with your unique circumstances.

7. Communicate policies and provide training 

Ensure that policies and procedures are effectively communicated to all employees. Conduct regular training sessions to educate employees on their compliance obligations, including any updates or changes to policies.

8. Establish monitoring and reporting mechanisms 

Implement monitoring and reporting mechanisms to track compliance efforts and identify potential issues. Encourage employees to report concerns or violations confidentially and without fear of retaliation.

9. Regularly review and update policies

Compliance policies and procedures should be regularly reviewed and updated to reflect changes in laws, regulations, industry standards, or internal business processes. Stay proactive in addressing emerging compliance challenges.

10. Seek legal and compliance expertise

Consider engaging legal and compliance professionals to review and provide guidance on your policies and procedures. They can help ensure that your organization is meeting all necessary legal and regulatory requirements.

Pros of addressing Compliance Policies & Procedures thoroughly

• Potentially shelters your company from lawsuits
• Strengthens your public image
• Improves the integrity of business transactions
• Improves your work force retention rates.

Cons of not addressing this topic

• Increases the risk of lawsuits and or financial penalties
• Harms the public image of your company.