It is said that you are risking everything even when you decide to risk nothing. Risk… such is its presence in business. The concept of risk management and compliance management came into practice due to the sole existence of the element of Risk in a business organization.
Risk Management and Compliance Management, are two indispensable functions of running any business which complement each other continuously. The two concepts might seem very closely related. Although it might be expansive as two closely related concepts, with the right expertise can be implemented into a structured framework suitable for your business.
I. Compliance – The antidote to Risk
Compliance and compliance management has been developed as a discipline in business as essential as a risk. Hence, the applications of compliance management extend as extensively as risk itself, in a business. A business being “compliant” refers to it adhering to a pre-decided framework of principles or rules or standards depending on the nature of business.
1. Scope of compliance:
Compliance management comes into the picture to simply ensure this remains in constant practice. It involves identifying risk, creating a predefined structure of policies for internal control to prevent risk, associating the existing legal rules of the country/state which apply to the business organization.
It also includes monitoring the business activities in line with internal policies and external statutory requirements of country or state, constant assessment of ongoing business practices with compliance audits, and suggesting corrective actions to be implemented if required.
2. Statutory compliance & risks in non-compliance:
Compliance management identifies possible areas of risk present in the business structure proactively in the process of simply adhering to a set of the predefined framework of principles, legal standards. It reduces possible risks; it reduces the cost of that identified risk by preventing the risk itself through early prevention of occurrence. Through prevention of identified risks, it warrants the goodwill of the business in advance and as a result, improves the intellect of the decision-makers. It also increases the awareness and training for existing resources of the organization as a measure of corrective action to any non-adherence.
Compliance management examines the legal aspects of the business conducted, using statutory regulations laid down by the state where the business is being conducted. This ensures the quality of output in business. We at Diligen, have well-developed and implemented compliance management solutions for you. Working with us can also improve your overall organizational reporting systems, by documentation of identified risks with our timely compliance audits.
3. How is outsourcing a better option?
While compliance management is one such area that removes many concerning risks within your organization, it also creates a few concerns of its own for you. The major concern about compliance management is the expensive costs of developing a strong compliance management framework. Diligen offers the best Statutory compliance experts which will be your solution to these concerns. Completely outsourcing the compliance management for your organization to us will prove to be an easy way out for you. It involves a large amount of detailed reporting due to its scope as wide as risk itself, it can lead to exhaustive usage of resources and records.
Utilization of your resources means adequate training on compliance procedures and costs involved in training. The fact that compliance is constantly evolving in nature is an added concern. It takes expertise and experience to stay abreast of all statutory and legal policies. Our compliance experts will help your business to stay compliant even amidst the changing regulatory requirements.
Outsourcing the compliance management of your organization to a professional team of risk and compliance experts can save time, resources, and guarantee the benefit of professional services to your business. What your business needs and deserves… the best, is at Diligen!
II. Risk Management
1. The element of risk in business:
The scope of risk in the world of business has been well established over the years by experts and business leaders. One of the oldest and most conventional forms of protection against all risks and uncertainties has been insurance, but the very beginning of “management” of this risk element in business began when businessmen had to find cost-effective alternatives for insurance. Risk management involves steps undertaken to identify, analyze, and control the probable areas of risk in an organization, keeping the objectives of the business in mind.
2. Risk Vs Compliance:
Unlike statutory compliance management, risk management requires an exclusive approach since the risks are unique and so are the plans made to manage the risks.
Compliance is an inclusive element of constant business practices while risk management can be restricted as a one-time activity when done effectively and well in advance. It can be said that Compliance as a function is a preventive tool in risk control/risk mitigation while risk management is planning of business management while being exposed to various risks.
3. What is ERM:
ERM, enterprise risk management refers to a detailed plan devised by an organization to manage risk without compromising on business objectives. The types of business risks involved vary for each business. A risk management plan is unique for each business. To launch an effective ERM plan, it is important to first assess the risk appetite of the business.
Also, the various types of risks like business risks, operational risks, financial risks, technological risks, etc. are to be taken into consideration while preparing a risk management plan. The second step is to list out the organizational objectives and allocate resources for essential objectives.
III. Information transparency
Any business comes with its risks, but certain factors can accelerate these risks within your business operations. Although every business is exposed to these kinds of risks, it can be said that it is slightly on the higher side if the business opts for outsourced services without proper research. In other words: if not done professionally, outsourcing can be a potential risk factor to the compliance management in your business. This must be a requisite while choosing to hand over your business risk management a third-party service. By choosing Diligen for your risk management, you will be effectively migrating these kinds of preliminary risks as our team of compliance experts have an extensive subject and professional knowledge.
1. Risks in outsourcing:
It is said that business information exposure is increased when you outsource, this is otherwise termed as business confidentiality being compromised. These outsourcing risks have widened as business operations have become completely computerized today. This is also said to affect the extent of business control. We at Diligen, understand the importance of information transparency and keep your business operations protected.
2. Information transparency:
Information transparency is the part of your business where you conduct business with open communication, clear and straightforward operations, and build trust within your business organization. It is an important part of any business because it is a part of business ethics and compliance. Diligen is one of the best in handling risk and compliance management services. We help you plan and frame objectives, understand requirements, draft a complete plan and execute your operations.
Takeaway
Information transparency in business and outsourced services is very important to ensure compliance within outsourced business services. The objectives aimed at achieving through the services and the important requirements for performing the services must be established between the outsourcing business organization and the service provider/team of consulting experts. Information transparency and outsourcing risk can be ensured by planning a structured flow of information to be provided to external parties of business. To plan this, you will have to clearly define the extent of information transparency and must then plan it within a risk framework.
