It is a word of English origin, which comes from the term “to comply with”, that is, “to act according to”.Compliance, therefore, means acting in accordance with some standard, law, guideline or internal and external policy.Currently, compliance functions as a business management system, responsible for ensuring that a company complies with external and internal laws, guidelines and policies.
The objective of compliance management is to ensure that the company’s good reputation is preserved, keeping it away from any corruption or fraud scandal, whether in the financial, legal or administrative areas.This entire management process is based on the rules of the regulatory bodies, such as municipalities, states, federal rules and even the company itself.
How is a Compliance Program implemented in a company?
For a company to have a Compliance Program or an Integrity Program in place, some essential steps need to be followed.
First, a company risk diagnosis is made. This analysis is performed based on the institution’s ethical values and aims to find possible situations in which these values may be violated, whether in the legal, corporate, strategic or administrative spheres.
This first phase is important because it is from the result of this diagnosis that the consultant and those responsible for the company are aware of what can be harmful to the integrity of the institution.
The second phase is the management of the risks found in the diagnosis. At this point, the compliance manual is merged with the company’s values and possible risks. This must be presented and followed by employees, partners, customers and suppliers.
This phase is important so that everyone who belongs to the institution is aware of the possible risks that the company runs and how they can avoid them in their daily work.
The third phase is to create antidotes that prevent the possible risks from actually happening. This is important for the company to always be able to act immediately in the face of any situation that puts its reputation at risk.
The fourth phase is the monitoring and management of reports that function as the maintenance of all previous phases.
It is important to note that a Compliance Program is constantly reassessed and adjusted, as it aims to always be aware of new risks that are harmful to the company.
What are the benefits of Compliance for companies?
There are some benefits that a compliance integrity program brings to a company. Some of them are:
Competitive advantage
As it is a company with constant monitoring to prevent fraud and corruption, those who adhere to an integrity program such as compliance, are able to maintain a good reputation in their industry.
This automatically generates a great competitive advantage for other companies that do not have integrity programs.
Risk prevention
By predicting risks of corruption and fraud, automatically companies that adhere to compliance are able to predict financial, administrative, and even legal and strategic problems.
This helps to maintain the company’s reputation as careful with its own future, becoming more reliable.
Good reputation and credibility in the business market
By taking greater care with the transparency of its business, a company that implements a compliance system becomes more reliable both for its customers, as well as for suppliers and investors.
Thus, the institution builds a good reputation within the business market, transmitting credibility to any person or company that wants to establish a relationship with it.
How did compliance come about?
Compliance was first registered in the United States of America in 1913, when the FED: Federal Reserve System, also known as the US central bank system, was created.
The FED was responsible for maintaining oversight so that all American banks were in compliance with the country’s laws, avoiding any banking corruption scheme.
In 1972, there was a major political scandal that accused then-President Richard Nixon of paying officials to clandestinely spy on the opposition party. After this and other corruption problems that followed, the FCPA was created in 1977: Foreign Corrupt Practices Act, the American transnational anti-corruption law.
This law aims to keep the government and companies in full transparency in accounting matters, in addition to combating international corruption. After its creation, the United Kingdom also implemented an integrity and transparency law, called the Bribery Act. In Brazil, the anti-corruption law (12,846) was created in 2013.
All of these laws and control systems give rise to compliance. Each of them indicates the path of accounting, legal and administrative transparency to be followed by public, private companies and even the government.
What are the characteristics of the compliance program?
A compliance program has characteristics that benefit not only companies, but their partners, employees and customers. Some of the main ones are:
- Provides and builds an identity for your company, helping to develop and shape its own dynamic culture;
- It is highly detailed to analyze the possible risks that a company runs;
- It is always in accordance with the laws and guidelines of the country;
- It promotes an anonymous and safe reporting channel, within the company itself, so that illicit attitudes are communicated;
- Can have a global view of the company, in all areas of operation
