All around the world, regulatory bodies are constantly creating and revising laws and making regulatory changes that govern businesses operating in specific industries. While most of these laws are only applicable to large corporations that meet specific requirements, sometimes they apply to smaller businesses, too. That’s why it’s important to have a strategy for remaining in compliance with all applicable laws. It’s just not possible to stay on top of ever-changing industry regulations manually.
The consequences of non-compliance are steep
According to data published on FintechFutures.com, the first two quarters of 2023 saw more than $3.7 billion in financial enforcement fines. A French ad company called Criteo was fined 40€ million for violating the GDPR by not getting user consent for targeted advertising. The original fine was 60€ million, but the company sought to get it reduced. Other companies in varying industries have also been hit with steep fines, and the only way to avoid this situation yourself is to stay on top of compliance requirements.
So, what is the best way to stay on top of regulatory changes? Here are several tips.
1. Follow your industry’s best practices
Best practices will vary between companies, but there are usually industry standards that are generally accepted across companies. Use these to your advantage whenever possible. You might be surprised to learn how powerful a simple standard can be.
For example, reporting compliance software provider Workiva offers some helpful insight into how businesses in the insurance and mutual funds industries stay on top of compliance using investment reporting best practices. Some of the tips include using language that can be understood outside of the industry so investors and regulators can immediately understand what they’re reading.
Another helpful tip they share is to maintain a document editing process so that updates apply to all required documents. The problem is that sometimes there are hundreds of documents that need to be updated, and this is far too tedious to do manually. The solution is to use software that hosts the main content that gets included in documents dynamically, so you only have to update the information once in one location. This reduces the potential for errors and oversights.
2. Hire an attorney on retainer
You can hire a lawyer for an hour of their time here and there, but that means you’ll need to constantly check in with them to find out what’s new in your industry. When you have an attorney on retainer, you pay them a small monthly fee and they are at your disposal for anything you need (up to a certain amount of time). There may be months where you won’t need to get any advice from them, but the real value comes into play when your attorney contacts you anytime there are changes to the laws that govern your industry. This is priceless.
If you attempt to gather regulatory changes manually, you might miss some changes when you’re not actively looking. You don’t have time to look for changes every day, so by the time you find out about a change, you might already be non-compliant. It’s worth paying a monthly fee to an attorney to keep you up to date instead of trying to do it on your own.
3. Attend industry conferences
There are plenty of reasons to go to conferences, including networking opportunities and the chance to find partnerships and joint ventures. It’s also a great way to stay aware of new industry regulations and/or adjustments.
If you can’t find a conference in person, there’s probably something happening online that you can either stream live or watch as a replay. It may even be easier to stream an event than to drive somewhere unless you want to connect with people in person.
Even if you can’t attend, pay someone else from your company to attend or watch on your behalf and take notes. Tell them to specifically pay attention to announcements dealing with regulations and laws, and you will get the information you need.
Embrace technology for the best results
When possible, leverage technology to streamline compliance through software automation. It’s truly the best way to manage your obligations and monitor legal updates. With the right software, you’ll be notified of updates daily so you can always make the proper decisions for your company.
Featured image provided by Pixabay; Pexels; Thanks!