The Nasdaq 2020 Global Compliance Survey report shows that that the importance of compliance has never been higher, with 74% of organizations considering compliance standards highly important.
However, even though most companies understand the importance of compliance, many of them struggle to actually manage compliance risks.
This issue is even more complicated in XaaS scenarios. Companies are accountable for how they handle personal data, whether in the cloud or in-house. If they lack a comprehensive understanding of their XaaS solutions, IT companies risk running into compliance issues.
While XaaS providers usually offer better privacy protections and overall security than companies can execute themselves, a Deloitte survey shows that more than half (55%) of surveyed companies state that ensuring data security in XaaS initiatives is either entirely or mostly their organization’s responsibility.
So, how can companies successfully manage compliance risks on their own?
Managing Compliance Risks: Best Practices
In order to properly manage compliance risks within your company, it’s essential to take a methodical approach when identifying and mitigating compliance risks your business faces on an ongoing basis. Here are 6 best practices to help you achieve that.
1Starting with Risk Assessment
It’s impossible to successfully manage compliance risks without understanding what those risks actually are. Without a comprehensive risk assessment, all your compliance efforts might go to waste if they don’t address the right issues.
Cloud adoption is a great opportunity to incorporate an adequate compliance strategy into your infrastructure in case your legacy system didn’t have one. It’s essential to perform a risk assessment prior to the adoption of cloud computing and XaaS solutions in order to create a system that focuses on prevention instead of correction of previous mistakes.
2Third-Party Risks and Due Diligence
It is essential to perform at least some level of due diligence on all third parties associated with your company. In fact, some of the biggest compliance risks stem particularly from interacting with third parties.
That’s why a comprehensive due diligence process should be an integral part of your compliance risks management strategy.
The higher the number of third parties you’re dealing with, the more important it is that the due diligence process is as streamlined and automated as possible. Using due diligence software can help you quickly categorize third parties and automate the screening process, saving you valuable time.
3Keeping up with the Latest Enforcement Policies
Understanding the requirements imposed by all applicable laws and regulations is an essential part of compliance risk assessment.
However, it doesn’t end with just understanding the letter of the law. It is also important to stay up-to-date with all of the latest guidance and enforcement policies.
While major regulations are no longer causing issues as companies have had time to adapt to them, with the switch to remote work during the pandemic also came new risks, so regulations are likely to tighten and companies should be prepared to adapt.
4Using Automation to Save Time and Eliminate Frustrations
It is apparent by now that managing compliance risks is a complex and time-consuming task. It involves managing many complicated processes at once and a myriad of stakeholders.
At the same time, there’s a number of mundane tasks involved in compliance. Chasing employees for signatures or attempting to manually retrieve records from multiple locations and non-centralized storage can be a huge waste of time and resources.
In case you have to handle eDiscovery requests, it’s helpful to have software such as an automated email archiving solution that will help you easily retrieve email records from a safe centralized repository.
It’s much easier to automate archiving and create a searchable record base than to worry about backups or manual archiving on a daily basis.
Automating such processes doesn’t just save time and leave more room for more important tasks such as offering training to the most high-risk employees and revisiting compliance risks.
Using technology also eliminates frustrations and reduces the annoyance factor of manual processes. This will help you drive engagement with your compliance efforts and make sure that your employees are actually sticking to the policies that have been put in place.
5Building a Culture of Ethics and Compliance
When trying to manage compliance risks, it is easy to get lost in managing complex issues and trying to meet the latest enforcement policies.
Compliance policy can quickly turn into a tick-box exercise, but instead of aiming to meet expectations in the short term, you should focus on creating a more sustainable environment and building a culture of ethics and compliance within your company which will help you meet these requirements in the long run.
When it comes to building a culture of ethics and compliance, it’s crucial to set the right tone from the top of your organization. The role of senior leadership is to clearly communicate the level of ethical conduct expected from employees to the middle management as well as the rest of the organization.
Moreover, the top of the organization should serve as an example of good practice, and lead by example instead of focusing solely on words.
Compliance training should be easily accessible to all of your employees and delivered in an engaging way to ensure that the message actually sticks. Failing to do so will make your efforts futile and employee training meaningless.
6Continuously Updating Your Compliance Policy
We’ve already shed the light on the importance of keeping up with the latest enforcement policies. However, regulations are not the only thing that’s changing and need keeping up with. Your company is also continuously evolving and so are compliance risks that come with every internal change.
Treating your compliance policy as a one-off project is a mistake and can lead to compliance issues or even costly security breaches. Instead, evaluate your policies regularly and update them whenever significant internal or external changes occur.
Managing compliance risks involves lots of moving parts and it’s not easy to keep up with.
By performing risk assessments, automating as much as you can, keeping your employees educated, creating a culture of ethics and compliance, and regularly revisiting and updating your policies, you’ll be able to make compliance easier and minimize risks and mistakes.
Following these tips will help you mitigate risks in your organization and ensure compliance in the long run.