What are The 7 Elements of a Compliance Program?

In every business, there is a requirement for a strong compliance program. How must the program be formed? And how must it be regulated? Every business person asks these questions. Usually, the compliance officers build such programs to comply with the regulations, rules, and laws. 

Additionally, a compliance audit is done in every organization to thoroughly review and ensure that the business follows the regulatory guidelines. But certain elements allow these programs to be effective. So, what exactly are those seven elements? If you want to know more about them, you can keep reading this article.

  1. Policies and procedures: The compliance program has many written policies and procedures that ensure to meet the company’s expectations. All the company employees, starting from the Board of Directors to the workers, must adhere to these rules and regulations. Well, the Code of Ethics or a Code of Conduct written by the compliance officer applies to all the employees of the organization.
  2. Education and training: The Code of Conduct or the Code of Ethics have a set of procedures that all the employees of the organization must follow. But for that, they must be adequately trained. With proper education and training, employees will understand the importance of written policies and procedures.Also, they must learn the importance of ethical conduct. Although it can be easy to adopt the policies and sign a form, the employees must incorporate the policies and procedures after understanding them.
  3. Compliance committee or chief compliance officer: When you designate the compliance offer or a compliance team, they must have sufficient resources to manage the program on an everyday basis..They must also have access to the Board of Directors and work with the Human Resource department. So, in a nutshell, the compliance officer must ensure that the program is managed and implemented properly.
  4. Reporting: If there are any issues related to compliance, it is usually managed by the Human Resource department. At present, the compliance officer or compliance team handles all the grievances. So, when workers or employees face any problem, they make sure to provide feedback about the program.Thanks to the program, the compliance officer or the team has enabled reporting compliance issues. Also, employees are allowed to report issues anonymously. After all, these kinds of provisions allow a non-intimidation culture. These provisions are necessary since the traditional program allowed employees to fear their jobs and provide effective feedback.
  5. Monitoring and auditing: A compliance audit is crucial for an effective compliance program. But why is that so? That’s because the compliance officer or the team can identify errors or weaknesses in the program. For instance, user access was enabled even though the employee had left the organization. They must also monitor other problems of the company.For example, some employees might have not yet understood or signed the Code of Conduct. It can lead to harassment of other employees. So, if any misconduct arises, it is necessary to monitor the program and gain feedback. After all, evaluating the program and making changes, if any, is an essential task for the compliance team or officer.
  6. Enforcement: Whether you are the company’s CEO or an intern, it is essential to support the program written and implemented by the compliance officer. The policies and procedures must be applied and followed by everyone. The employees must actively commit to the program for proper and consistent enforcement.
  7. Effective communication: Effective program communication is necessary no matter the language. For instance, you might have written the Code of Conduct in English. But your workforce doesn’t communicate or interact in English. So, you must ensure to write it in their spoken language. You must effectively communicate the policies and procedures.