Maintaining high standards of excellence in all areas is vital for a good business reputation. This means a company should maintain constant vigilance regarding regulatory and legal requirements it is expected to adhere to.
Large organizations have compliance officers whose sole job is monitoring such issues, and their primary job objective is protecting their company’s reputation. Your company might not be large enough to justify such an expense, leaving the job of ensuring compliance up to you or a trusted delegate. Here is why it is so important:
Compliance is an investment
Recovering from a devastating reputational blow is a time-consuming process, which might be impossible in extreme circumstances. Prevention is better than cure, and putting systems in place to avoid such an occurrence can save your business thousands of dollars in lost revenue. Therefore, instead of regarding compliance as an expensive hassle, see it as an investment in your business’s future.
Several areas of compliance can be examined when Equifax business credit reports are requested. Broadly speaking, these include business identity and description, a risk profile, and a summary of payment history, and any legal filings.
Companies can visit accredit to get this intelligence about your business before dealing with it. If there are areas of non-compliance, these organizations might choose not to interact with your enterprise, preferring to take their business elsewhere.
Compliance is a preventative measure
Some business owners only become aware of the need for compliance when it is too late. Your compliance practices should not be reactive as the damage will already have been done. It is preferable to act proactively regarding compliance, which means fulfilling its requirements before a problem arises.
This requires effective planning practices to meet compliance deadlines without a rush as the due date approaches. Most business owners opt for a diary and reminder system on their computer or cellphone. However, this schedule must be kept up to date as new compliance regulations come into force and must be accommodated.
Reputation management should not be the sole outcome of compliance
While compliance officers mentioned above might feel that their job is protecting their company’s reputation, this should not be the single objective of doing the work.
A reputation for compliance should result from the process without being its sole aim. To achieve this, you should focus on the quality of compliance. This means being ahead of the game, sticking to a planned schedule of compliance activities, and devoting sufficient attention to them.
Malicious compliance, which is adhering to the minimum without putting too much effort into it, will eventually receive negative attention. Quality compliance provides companies with the chance to stay under the radar or outshine their competitors. Either result will maintain a good business reputation.
Take advantage of your company’s compliance status
Few people will know about your company’s compliance status if you do not bring it to their attention. Therefore, you should publish it on your company website, together with any endorsements that accompany compliance with requirements from state or regulatory bodies.
This builds a sense of trust in an organization, which makes it more reputable. People feel more comfortable spending their money at a company that can prove it complies with the law.
The public does not tolerate dishonesty and a lack of transparency well and can be punitive in the face of non-compliance issues that blow up into a complaint.
Investors have similar feelings and will shy away from putting money into your company as it presents a significant risk that they cannot afford to take. When your company comes to the attention of regulators for non-compliance, expect scrutiny for the foreseeable future.