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The 4 Steps to First-Level Regulatory Compliance Management

Regulatory Compliance

With the gradual increase in the legal obligations of companies; ensuring compliance with the regulations that apply to the company, and consequently avoiding sanctions by the competent authorities, has become a preeminent and challenging activity.  

According to Gartner's "2022 Top Priorities for Legal, Compliance and Privacy Leaders" report, one of the five biggest challenges for companies is the "cluttered and inefficient tools for tracking and communicating regulatory changes".   

To combat the challenge generated by the monitoring and traceability of regulatory updates, the legal areas of organizations have relied on digital tools that allow them to know and control compliance with all regulations applicable to the company, and then track each of the obligations acquired and thus have control of the legal risks associated with the business.  

Technology has revolutionized the management of regulations, but to take advantage of its functionalities it is necessary to apply these solutions correctly.  

 

Steps for proper regulatory management 

For first-level legal management, it is useful to divide the process into 4 steps: Analysis and detection (1), Preventive actions (2), Follow-up and monitoring (3) and Incident resolution (4).   

In each case, it is necessary to carry out key actions to ensure responsible diligence: 

1. Analysis and detection 

Because the regulations applicable to the business are directly related to its activity, the first step is to detect the legal risks that the company has, assessing their severity and probability of occurrence. 

This includes: 

  1. Analysis of processes, activities, products, and/or services managed.
  2. Identification of applicable requirements and elaboration of a matrix of regulations. 
  3. Identification and periodic update of applicable standards to the organization's activity. M-Risk's digital solution updates its regulatory base on a monthly basis, simplifying this process.
2. Preventive actions  

Once the organization's legal risks have been identified, it is necessary to define processes to control them and thus prevent non-compliance.  

For this purpose, the M-Risk software has alerts and notifications that remind the responsible to verify compliance with the company's legal obligations. 

3. Follow-up and monitoring  

To ensure compliance with all regulations, it is necessary to monitor compliance verifiers. This includes:  

  1. Regularly updating the regulatory matrices.
  2. Evaluating compliance with applicable regulations and measuring performance through M-Risk Analytics compliance indicators.  

In the M-Risk solution, compliance indicators are at various levels and allow showing from a general status to a higher level of detail; allowing a detailed performance measurement.   

In addition, through specific dashboards according to the user's requirements, the information is presented in the application in real-time; allowing immediate actions to be taken and thus avoiding falling into non-compliance and fines.  

4. Incident resolution 

In order to resolve incidents, whether derived from internal audits, planned audits, and/or periodic follow-up by verifiers, it is necessary to have an action plan prepared and ready for execution.   

 

Necessary characteristics of digital regulatory management systems 

Having a process in place, although essential, is not enough. Having tools that work the information in a way that is useful to the user is as important as an efficient process.  

M-Risk's digital solution allows the visualization of compliance indicators and KPIs at different levels, from the general status to a deep level of detail; which is useful to maintain total management of the area.   

On the other hand, because an error in the management of regulations can be detrimental to business continuity, M-Risk forces you to upload evidence of compliance associated with each obligation indicated in the regulation, thus reducing the possibility of errors.   

Implementing and maintaining an effective corporate management system requires compliance with the corresponding regulatory framework. With the increasing demands, digital solutions come as the answer to the rising challenges that the legal areas of companies face today.    

 

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