4 Necessary Elements of a Compliance Management Framework

compliance management framework
Your compliance management framework is a vital piece of your overall compliance program. Read more about the 4 necessary elements your organizations must have. Read More

Your compliance management framework is a vital piece of your overall compliance program. Read more about the 4 necessary elements your organizations must have. 

Your compliance management framework is a vital piece of your overall compliance program. Read more about the 4 necessary elements your organizations must have. A compliance management framework is a critical part of the structure of every company. It can be defined as a set of procedures for organizations to follow to conduct their businesses within the laws, regulations, and specifications. It consists of tools, processes, functions, controls that are written down by the top management and directors of each organization. The benefit of these compliance procedures include:

  • Prevents breaking the law which may affect the company’s reputation and avoid heavy penalties.
  • Providing guidelines for operations and implementation of the organization
  • Assigning responsibilities to different people in a company and holding them accountable
  • Help in gathering information for reports.

Therefore, it is essential for every organization to have a compliance management framework for the overall growth of the business. There is various compliance management software that you can select from the market.

Cybriants offers a unique service that will help you create a baseline for all regulatory compliance audits you face. Our compliance management system is called ComplyCORE – read more about it here. 

When choosing your compliance management framework, you should consider the features and select the one that best fits your company. You should also consider the costs and the reviews made by other organizations.

Compliance Management Framework – 4 Necessary Elements

For a compliance management framework to be effective, there are certain elements which are necessary as explained below. The four elements are designed for most of the administrative tasks and make all the work in the organization easier.

1. Compliance program

For a business to comply with all the rules and regulations set, there must be a compliance program to follow. The compliance program should have:

  • Policies- The policies should be set by the management to be followed by employees in the company. The management should ensure that all entry levels in the organizations follow these policies.
  • Processes- Depending on the kind of products or services that the company offers to consumers, there should be a list of the process to be followed to ensure that everything is by the regulations.
  • Training- It is essential for organizations to offer training for their employees. Training is done during the hiring process and also when new procedures and rules are being implemented. Training will remind staff members and help them learn new ways of conducting their business.
  • Monitoring- There should be a monitoring policy to check if the rules are adhered to. Government or private bodies can do monitoring. The organizations should come up with a monitoring system for all the departments to monitor where the guidelines are not followed.
  • Corrective actions- when mistakes are made in the company, there should be corrective actions to ensure that the errors are not repeated. You should note that the lack of compliance in the organization can affect the organization’s reputation and cost a lot of money.

 2. Commitment from the Board of Directors

The Board of Directors in an organization acts as the management oversight of every organization. The management should be committed to integrity that the organization will abide by the laws. Being at the top, they should lead by examples for other junior employees to learn from them.

The board of directors should come up with a code of conduct, communicate the expectations, adopt policies and explain to the staff about the proper compliance function. They should use proper enforcement programs to ensure that everyone in the company observes the compliance guidelines.

The board of directors and management oversight should provide the necessary resources that will allow laws and regulations to be applied in their organization.

3. Consumer Complaint Program

For compliance management framework to be successful, it is essential to know the feedback from consumers. There are several ways in which consumer complaint programs are important.

  • Helps the organization to know the products which offer satisfaction and those that don’t. With this, the company will focus more on satisfying the consumers.
  • The organization can identify the kind of complaints that customers have towards the company and look for ways to improve on that area.
  • Helps the organization to come up with alternatives products or services for consumers if they are not satisfied with the current products.
  • The company increases their credibility to their customers once they know that they are concerned about their feedback. Customers are happy when they get instant feedback from the company.
  • The organization can reply to the customer’s questions until they are satisfied through the consumer complaint programs. This enhances the reputation of the organization to the customers and the entire market.

Consumer complaint programs use different ways to get feedback from customers. They include social media, reviews, and questionnaires.

4. An audit from an independent body

A compliance audit is a review of an organization’s compliance with the laws and regulations. It also reviews whether there is adherence to the internal policies and implementations. The compliance review should be carried out by an independent body to avoid biased reviews.

Compliance audits should be conducted regularly, and the board of directors should determine how often the audit should be done. The senior management should come up with the scope of the audit and provide the independent body with all the materials and resources required for the audit.

Auditing is essential in every organization as it will help the management to identify compliance risks and ensure that the employees are adhering to the ongoing compliance. In the audit team, it is crucial to have some members of the organization’s monitoring system to ensure that the audit is done correctly.

Once the audit is completed, the reports are documented; gaps identified and come up with corrective actions. The audit reported should be handed over to the top management or the board of directors for further action.

Though it may seem like a lot of work, implementing a compliance management framework comes with a lot of benefits for your business. You will not have to worry about being on the wrong side of the law, have a stable financial department, build a good reputation and identify the right suppliers. Therefore, as a business owner, if you have not yet implemented a compliance management framework or system, make sure that you do so immediately and start enjoying the results.

Compliance Management System

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