In recent years, throughout the world we have followed the high level of corruption in various economic sectors. Several companies end up having their image and reputation weakened due to their proven involvement, both at the business level and in the political sphere.
The imperative need to know and practice compliance in day-to-day activities arose in the midst of this reality, which affects companies of all sizes and industries.
The concept of compliance in business aims to generate value for an organization and ensure its survival. This practice arises from the great financial impacts caused by factors such as:
Read on and learn more about this important concept and what the word compliance means in practice.
The verb comply means to conform to a rule, which explains much of the concept of the word. The meaning of the word compliance is related to the conduct of a company and its compliance with the rules of regulatory bodies.
What is compliance in business, in short? It means to comply with laws and regulations.
This concept covers all the policies, rules, internal and external controls to which an organization must conform. When in compliance, an organization’s activities will be in full accordance with the rules and laws applied to its processes.
Both the company and all its people, including suppliers of interest, need to behave in accordance with the rules of regulatory bodies.
In addition, they must ensure faithful compliance with the various internal normative instruments. Only in this way will the company comply with regulations for environment, labor, finance, work safety, operations, accounting, etc.
Being able to say that a company is in strategic compliance is by itself a fundamental business strategy. It means that there is transparency and an increasing degree of management maturity. Being in compliance shows that managers and teams are in control of the processes and procedures, implemented and executed with effective political, commercial, labor, contractual and behavioral compliance.
Not being in compliance means being unnecessarily high risk, which can lead to financial, equity and market losses, among many others. Risk management and compliance are closely linked.
It is necessary to reflect and change management styles, adjust the way company information is handled and how people behave on a day-to-day basis, in order to achieve a level of excellence in compliance regardless of the business sector and size of the company.
Now that you know what compliance in business is, check out some tips:
With these actions, the company reduces costs and expenses, increases its operating income and avoids losses. In addition, with the compliance of laws, the transparency of processes becomes a more consolidated reality, which brings greater confidence in the market.
The teams involved become more prepared and increase their performance, which is reflected directly in productivity.
The reputation and the good image are a reflection of the level of compliance that a company proposes to have. Therefore, using this concept to guide the good practices of the organization significantly reduces all risks to the company, creating a healthier and more reliable environment.
Adalberto A. Nascimento Jr.
MBA in Business Management – Partner and Consultant in Business Management.
ASGEM – Advisory in Business Management
adalberto.anj@gmail.com
After this lesson, is the answer to the question “what is compliance in business?” now clearer to you?
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