What is compliance and how to implement it

by Łukasz Napiórkowski

10 May 2021

What is compliance

Compliance is a set of rules designed and implemented in the organisation to ensure that it operates in compliance with domestic and international laws and other standards of conduct. The purpose of compliance is to minimise the risk of irregularities which would have a negative impact on relationships with clients and contractors and decrease the goodwill.

Compliance department – what is it for

Compliance departments with wide competences are created in many companies, in particular and originally in financial and insurance institutions. The competences include, without limitation, mitigating criminal liability of managers, counteracting money laundering, monitoring anti-corruption procedures and training employees. However, compliance department acts not only inside the organisation but also outside it – it protects personal data or develops a catalogue of good practices in relations with contractors.

Compliance officer – who is it

Compliance officer is a specialist whose role is to limit the risk of violating the agreed rules of conduct by employees. As a result, compliance officer reviews, among others, the content of the contracts to be concluded, checks whether confidential information procedures are complied with and prevents conflicts of interests. He or she is also a guarantor that certain irregularities will not occur in the organisation.

How to implement compliance

Compliance is implemented in stages. First, the company’s business must be examined in detail. To this end, a review (audit) is carried out which helps, among others, identify the main threats and develop relevant procedures on that basis. The second step is the implementation of the developed procedure, testing it and amending as and when appropriate. An inherent element of compliance is also management and employee training.

Compliance – what are the benefits

The implementation of an effective compliance system in the organisation brings desired benefits, such as avoidance of criminal liability of managers, limitation of the risk of abuse and quick identification of threats. That is why compliance is also linked to corporate image – it increases trust in the company and that, in turn, increases its goodwill.