The Importance of Compliance in a Business
What does compliance mean to a business? At its core it refers to the steps an organisation must take to ensure it is acting responsibly and in line with the law.
Compliance defines the values and ethics of an organisation and works to create an environment within which all employees understand and refer to them and by extension agree to be held accountable by them as well. Operating from a healthy compliance function enables an organisation to reduce risk given the rules and guidelines in place for team members to follow. Whether those rules apply to harassment and discrimination in the workplace, fire and evacuation protocols or indeed a business continuity plan in the face of a global pandemic; if they are being upheld properly it leads to not only a productive work environment but one operated by professionals willing to work together to overcome any challenges they face.
Good compliance breeds trust, both from your employees and from the public. Fundamentally it is part of an organisation’s duty to both those parties as well as key stakeholders to practice good compliance in order to reassure them that you are operating within the law. It goes without saying that a key reason to ensure compliance is to avoid the risk of potential criminal misconduct. As well as the issues of traditional illegal activity such as fraud and money laundering, now companies must further hold themselves to account with regards to data privacy laws. Since the inception of directives including the EU GDPR and POPI (Protection of Personal Information Act, South Africa), the burden of mishandling consumer data carries with it not only excessive fines and penalties but also the threat of imprisonment. Now even more there is a need for solid compliance measures within organisations.
Moreover, on the subject of business risk, though the reality of hackers, scam artists, customer demands, natural disasters and economic uncertainty do indeed pose real threats, the majority of risks in fact come from unforced errors within an organisation. Internal disputes, underperformance and human error and misunderstanding all create weak spots in an organisation, but a strong compliance function can help pinpoint and thus mitigate those issues from festering and ultimately hurting the business.
Without compliance, business decisions are unstructured and likely to descend into chaos. Organisations need points of reference for decision making that stem from clear policies, values and codes of conduct to ensure processes and communications are streamlined and effective.
Compliance professionals these days do not only come from the traditional legal or financial backgrounds, with more employers looking to wield a more diverse means of hiring in order to strengthen their organisation. If you’re making a move from an accounting or operational role you will likely have the transferable skills for a career in compliance. Problem solving skills, the ability to connect with people across the business and having great attention to detail are among the top soft skills for compliance roles.
Candidates applying to compliance jobs, particularly Compliance Manager roles, can expect to receive average annual salaries of between £70,000 to 90,000 in the United Kingdom. According to Indeed and Barclay Simpson, the entry point salary for a Compliance Officer in the UK is between £30,000 and 45,000.
Businesses coping with the evolving regulatory climate are seeking out individuals with strong regulatory knowledge and practical financial experience given the impact on the banking and financial services sector in particular.