Quality controls

The development of regulation worldwide poses difficult questions for businesses: how do you keep track of the latest developments? How do you comply without bankrupting the business? And do your people understand that most vital development: corporate risk is now personal?

The answers lie in an effective compliance infrastructure. But what does that look like and how do you know that it's working?

Types of regulatory risk
Boards are currently dealing with a broad range of risks. Significant areas of focus include:

  • anti-bribery and corruption regulation
  • anti-competition and anti-trust legislation
  • fraud

Getting it right
Minimising these risks starts with understanding your compliance environment. Do you have a control framework and appropriate reporting mechanisms that help you assess whether your policies and procedures are adhered to?

You also need policies along with handbooks and supporting tools to help ensure your controls are met consistently. And not just by your own people. You will need to consider your commercial intermediaries. How many do you use and what services do they provide? Do you have formal contracts for them and are they bound to your ethical code?

Breaches or compliance weaknesses need to be addressed quickly and effectively. This demands the highest quality Programme Management. But the surest way to long-term prevention of compliance or legal breaches is the development of a sustainable compliance culture throughout your organisation.

This starts in the boardroom. Is the tone at the top right and do you know if it is having the desired impact on your people? Ensuring it is having an impact needs to be part of staff performance management. Do you, for example, embed the awareness of anti-bribery and corruption requirements throughout your organisation? Do you have the right balance between sanctions and support?

If you need to start changing behaviour, then training and leadership development is the key. Do your people understand the legal implications of their roles and responsibilities? Are you comfortable that your employees will make the right ethical judgements in difficult situations? Do they know when and where to get support?

Getting it wrong can mean fines or even prison sentences. Getting it right is the only option.