Compliance
Compliance is adherence to laws, regulations, standards, and policies in place in an organization or industry. Compliance aims to ensure that activities and business are conducted in a legal, ethical, and regulatory-compliant manner.
Types of compliance:
Legal compliance:
Compliance with national or international laws and regulations, such as taxes and labor laws.
Regulatory compliance:
Compliance with rules imposed by industry regulators, such as banks or insurance companies.
Internal compliance:
Compliance with the company’s internal policies and procedures.
Examples of compliance in different areas:
Banking field
Implementation of Anti-Money Laundering (AML) and Anti-Terrorist Financing (CFT) regulations.
Health field
Comply with privacy standards, such as the Health Information Protection Act (HIPAA).
Environmental field
Compliance with environmental laws such as reducing emissions.
Elements of effective compliance:
Create written regulations and policies that outline compliance rules.
Train employees to understand and implement compliance policies.
Monitor compliance through monitoring and analysis systems.
Provide confidential channels for reporting violations.
Implement disciplinary measures against violators.
Compliance objectives:
- Protect the company from legal and financial penalties.
- Enhance the company’s reputation and build trust with customers and partners.
- Support an ethical and responsible work environment.
- Reduce risks such as corruption, money laundering, or data breaches.