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What Is Compliance Monitoring?
You may have heard of compliance monitoring before but have never really received an explanation of what it entails. Whether you are a business owner or an employee, you need to understand the concept behind compliance monitoring – and how it can impact your business operations.
What is Compliance?
Compliance is all about following the procedures, internal policies, regulations and other details that keep your organization running smoothly. This could be anything from basic regulatory requirements – such as safety measures – to simple document formatting policies.
An organization has responsibility for its own business operations, records, and the behaviour of its employees. Non-compliance is not just a rejection of an existing process but a potential danger to the business operation.
Even the most basic kinds of non-compliance can cause a drop in overall effectiveness. For example, storing documents with the wrong date format or refusing to implement systems for dealing with customer complaints – both of which can be worthy of disciplinary action.
There is no perfect way to handle regulatory compliance monitoring and testing. Simaxx can help with compliance monitoring by providing tools for continuous monitoring and data evaluation, making it well-suited to giving you feedback and guidance that suits your business’ long-term goals.
What is Compliance Monitoring?
Compliance monitoring, as the name suggests, is all about monitoring your compliance risks. A business needs to monitor compliance to ensure compliance in the future, and that means spotting compliance risks before they can harm your business as a whole.
A compliance monitoring programme allows an organization to monitor itself and make sure that all employees are following standard procedures. It also makes it much easier to identify who is responsible for a major regulations risk and provides easy access to resources that can restore compliance quickly.
Without a good compliance monitoring plan, an organization can find itself at the greatest risk of inconsistency. Every industry is risk-based, and following set regulations and procedures is the easiest way to minimise those risks. Non-compliance is not just breaking the rules – it could drive away stakeholders, harm your brand image, or even upset important clients.
What is a compliance monitoring programme?
Every business has a set compliance policy, one that changes as the organisation adapts to new markets or technology. These are the standard operational procedures: the “right way” for the organisation to operate in normal situations.
A compliance monitoring program is your business’ method of observing each compliance or regulatory risk. A good compliance monitoring plan will outline testing procedures, responsibility checks, auditing and internal controls for dealing with the compliance issue.
Example: Health and Safety
A proper health and safety risk audit is important for any kind of property. Even for a property bought as an investment, management of health and safety reports provides assurance that the building is actually safe to use.
By keeping a consistent set of health and safety documents, a property or business owner can show that they’re competent and responsible when dealing with health concerns. Beyond that, these documents are incredibly important when it comes to dealing with the overall safety of an older property.
All industries put a lot of importance behind health and safety rules, and the property market is no exception. Keeping track of a building’s safety is extremely important.
Example: Electrical Work
The duty holder of a property should always aim to keep proper records of electrical installations and changes.
Even if there is no immediate danger or risk associated with the electrical system, it’s still important to follow basic compliance procedures whenever electrical power is involved. Having records of the installation process provides some assurance that everything was installed correctly, and that it was all installed by a professional.
Even in a niche like this, monitoring your compliance can help you avoid anything from technical issues to small cases of financial crime. Having this kind of protection can make a significant difference, especially if you’re part of a growing company.
Simaxx is perfect for providing the feedback needed to make this possible, ensuring that you’re always pointed on the right track when looking at more in-depth options for monitoring your compliance options and efforts.
The Value of Monitoring Compliance
Your compliance monitoring activity should be a non-stop look at your organization’s operations. The full purpose of a good compliance monitoring program is to remove any and all risk to your organization, monitoring each core process for any sign of a major risk.
Compliance monitoring is different to a compliance audit, which is a yearly check by a third party. Your own monitoring is usually from an internal compliance team headed by a chief compliance officer.
Protection of Customers
Customers can be at risk when compliance fails. Good compliance management reduces the risk to customers, ensuring that they remain customers while also reducing potential damages.
In some industries, good compliance management is a serious concern when it comes to customers. For example, healthcare businesses often do regular testing and reports to ensure that nothing will harm patients.
Protection of the Business
A risk may not simply be a financial loss. Depending on the importance of the issue and the damage done, your organization may also suffer liability lawsuits, settlements, or possibly even direct government intervention.
Monitoring ensures that you are going to catch these problems before they cause any harm. As mentioned above, health and safety risks are a huge part of compliance, and monitoring your property can allow you to resolve these issues very early.
Even if you miss a single compliance issue, the fact that you have chosen to implement a compliance monitoring framework offers some protection over businesses that simply ignore the problem altogether.
Protection of Profits
Naturally, compliance issues impact your bottom line too. A compliance team may be able to find and correct problems that impact a whole range of projects or even multiple aspects of your business.
For example, property management systems are often designed to catch faults before they can become too severe. In the electrical example above, having an easy way to
An immediate correction is always going to salvage more profits than allowing a serious fault to go unnoticed.
Any organization that refuses to do its own monitoring will effectively need support from the government. If your organization has issues, a government agency or other regulatory body will find them eventually – finding them first gives you more options to deal with the situation.
For one, monitoring your own processes and finding a compliance risk gives you full freedom to deal with it yourself. This means testing, working to identify the person at fault and keeping documentation on your own terms.
Putting a good compliance monitoring plan in place is going to make your organization far more trustworthy. It shows that you actually care about your products and services and that you are monitoring yourself constantly rather than simply allowing a yearly audit.
Building a Compliance Monitoring Framework
Regulatory compliance is best achieved through a stable compliance management framework, something that guides the rest of your compliance monitoring activity.
In a way, this is similar to preparing emergency response plans for something like product recalls. You need to keep to-date documentation on how to respond to compliance problems, as well as how to find them in the first place.
First and foremost, you have to start training employees to form a compliance team. The training can be minimal in many cases, but compliance monitoring teams still need to have a basic understanding of how their team will operate.
The more important part of the training is familiarising them with your business’s internal processes. This is a bit like learning the controls to a big industrial machine – they need to know what everything does and how it is meant to function so that they can identify issues with the system.
Monitoring your organization is a core part of any good compliance system. Proper monitoring is not just about visually spotting issues – you need to monitor all elements of your company’s operations, from documentation and formatting to the safety procedures involved.
This could be anything from checking up on QA work to testing individual parts of a production line. This might even mean looking into your training procedures, monitoring the way you store data or looking at how your representatives interact with other firms.
Monitoring reviews and customer feedback is just as important. Great compliance monitoring plans take the customer’s side into account as well – some issues only reveal themselves once a customer is actually using a product or service for themselves.
This goes for non-customer responses, too. Perhaps another organization’s representative was short-changed during a financial deal, or a meeting was arranged outside of official channels without the employer’s approval. These things are small, but they can lead to market abuse if left unchecked.
Compliance monitoring is all risk-based. The more risk something poses within your company’s overall risk profile, the more urgent your solution becomes.
Identifying risks where compliance monitoring comes into play can come in all shapes and forms such as the control of Legionella bacteria in water. Simaxx have created a system that monitors Legionella risks and creates email alerts when the system falls outside guideline requirements.
The testing process is vital to figuring out what went wrong. Compliance testing can involve a huge range of different factors and elements, depending on the context.
For example, the Environmental Protection Agency offers support for testing businesses for pollution control. A good internal example is private equity firms testing compliance risk issues, such as over-valuing their investment in a new start-up and getting roped into fraud investigations.
Compliance reviews are one of the most important parts of the monitoring process. If you identify and audit a situation, you need to review it and take the controls back before things get worse.
A review could involve an employee review. It could also include an equipment review. In many cases, it tends to be a review of the entire process that led to the problem in the first place. A compliance review needs to cover as much as necessary, providing as much detail as possible about the problem that occurred.
The compliance review is meant to focus on whatever caused the compliance issues and to review possible options for developing safeguards against the same problems. A good review is not just meant to assign blame but to genuinely review the services and processes that made the issue possible.
For example, a review of an embezzlement situation is not just a review of the perpetrator. It is also a review of the compliance issues that allowed the money to be stolen, a review of the services used to carry out the embezzlement, and a review of any regulators or managers who were personally tasked with preventing acts like that.
Responsibility isn’t just about blaming somebody in a review. A proper focus on who’s responsible can be important for any formal document, allowing you to review the individual people in charge of particular goals and tasks.
Compliance monitoring is not just focused on the person who pushed the button that caused the problem but the process that made it all possible. The scope of the review is company-wide, or at least department-wide, and that means that the review covers multiple people.
One employee may have forged documents and be at fault. However, the review might find that those documents were never checked as expected or that a manager responsible for checking the documents passed the work to an underqualified employee who was not hired for that kind of work.
After a review comes the compliance monitoring reports. These are the feedback before the follow-up, detailing everything the review found and the best options for fixing the issue going forward. Report templates are often used to ensure every template follows the same format.
If something goes wrong, then you need to update the part of your company that failed you. This means keeping things to-date with new regulations, as well as making sure that all software is up-to-date with your standards.
“Up-to-date” does not have to mean getting the latest hardware and software to completely overhaul your company’s systems. Instead, it means being up-to-date with your expectations and requirements: keeping everything accurate to date internally.
If you decide to make a regulations change to combat embezzlement, then you want to be sure that your entire organization complies.
How Important is a Compliance Monitoring Plan?
While an audit might be scheduled on an annual basis, compliance monitoring is constant. You need to know that your organization will comply with all relevant regulations to date and that you are keeping up-to-date with new regulations as well.
A lot of businesses require some trial and error to get their monitoring reviews and plans figured out, especially when it is not clear how much detail they need to go into. Having at least a basic plan in place allows you to increase the scope and depth of detail at a later date.
Simaxx can be a valuable resource for addressing compliance problems, giving you more options for monitoring your overall plan as it progresses. The better your tools are, the more you can do, even with a very basic compliance plan.
Third-Party Compliance Monitoring
Many companies rely on third-party firms or teams to handle their compliance monitoring needs.
Using a third-party team allows for faster checks since there is no need to wait for training and beginning at a later date. It also costs less than hiring your own specialised staff and can often grant you specialists with more experience than a new hire would do.
Of course, this isn’t perfect for every company. Finding the right compliance monitoring option means examining your own needs and company structure and then figuring out how you could monitor it best.
Software platforms like Simaxx are perfect for handling building-level compliance issues, helping you tackle compliance concerns in a variety of ways without getting in the way of other tasks or tools you might be focused on.
HWS & Legionella
Simaxx continuously monitors the flow and return from the HWS heating system in the occupied period. Events are generated against a series of bespoke rules.
Continuous monitoring and compliance requirements combined with analysis of relevant data sets provide alerts and insights into the safe storage of food.
Typically, activities involved in the collection and storage of data used in compliance monitoring are labour-intensive. Setting up automated systems removes a large number of resource requirements.
Case Study: Aquaportal