In the constantly evolving regulatory and technological landscape, many organizations have to rethink their existing approaches to compliance to keep pace with the change. In a data-driven environment, organizations need to act fast to adjust their compliance frameworks to meet growing expectations from theregulators and manage existing and emerging risks. Below are the top 5 signs that indicate that you need compliance system improvement and recommendations on practical steps to bring your compliance efforts to the next level.
Reliance on Manual Processes
When compliance work is based on manual processes, it becomes a hindrance instead of a strategic advantage. In particular, manual compliance can result in:
- labor-intensive processes,
- inefficiencies,
- duplicative processes,
- data inconsistencies,
- human error,
- data breaches and non-compliance.
Given the ever-increasing regulatory and organizational complexity, these consequences of deploying manual processes can lead to lower standards for compliance and result in penalties and business disruption. Last but not least, manual compliance does not allow organizations to scale up and stay audit-ready and M&A-ready effectively. For this reason, the reliance on manual processes is often the first sign that an organization needs transformation through implementing process automation.
Recurring Compliance Failures
Having recurring compliance issues such as inaccurate records, missed deadlines, incorrect filings, and abandoned and not maintained legal entities can happen for variousreasons, for example, poor employee performance, lack of managerial oversight, inadequate planning or occasional error. However, more often than not, the reasons for such failures are deep-rooted in an organization and are explained by non-existent or inefficient processes, data silos, lack of automation, and other systematic deficiencies.
While an organization needs to promptly handle each compliance failure to avoid potential penalties and business disruptions, it is even more important to address the underlying causes of such failures to avoid their recurrence in the future. Businesses need to lay out a foundation for their compliance work from day one to avoid snowballing failures and create a solid framework that can implement compliance on autopilot.
Difficulty in Adapting to New Regulations
Whenever organizations feel they lack confidence in their preparedness for regulatory changes, they should re-examine their compliance framework for having the required agility and technology to cope with emerging requirements. With new regulations, like the EU Corporate Sustainability Reporting Directive (CSRD) or Artificial Intelligence Act, shaping the regulatory landscape and setting the scene for similar enactments in the US and Canada, companies need high-performing systems to react to changes promptly as they come without relying on manual processes.
As new regulations place a higher demand for compliance efficiency, businesses need centralized storage for all corporate data and automated, customizable workflows to keep abreast of the new challenges. When the number of data points that must be collected, stored, processed, updated and filed under new regulations exceeds thousands, organizations can no longer rely on manual processes and need technology to ensure compliance.
Lack of Real-Time Reporting
If an organization lacks an effective system to ensure immediate access to its real-time data, the teams will have a reactive approach to compliance, which does not allow to scale up, adapt to change and use compliance as a strategic advantage. Additionally, a lack of real-time reporting leads to lower visibility, and an inability to use data for effective decision-making while making the compliance processes much more stressful, time-consuming and prone to errors.
As organizational structures in modern businesses constantly expand, encompassing hundreds and thousands of legal entities across jurisdictions, companies need systems to report data in real time to maintain all their entities in good standing and ensure timely filings. Real-time reporting is essential for an organization's audit- and M&A readiness, making the preparation process streamlined and much less time-consuming.
Siloed and Disorganized Compliance Efforts
While studies show that modern organizations use from 73 to 175 different applications, many businesses find their compliance data spread across different systems and locations. With such a siloed approach, the teams spend unnecessary time searching, requesting and retrieving data from various sources, which, in turn, leads to inefficiencies, data duplication, data safety issues, longer processing times and lower quality compliance.
When teams lack a centralized and instantly accessible repository, compliance management becomes a struggle, with teams having to reconcile data among multiple databases and send them back and forth for updates and approval. In such a scenario, the whole compliance effort becomes inefficient and prone to vulnerabilities, calling for frequent manual troubleshooting and requiring systemic overhaul.
How Athennian Supports Effective Compliance Management
Whether your team experiences all or just one of the above issues with compliance, it signals that you need compliance process optimization. If left unattended, any of the above can lead to gaps in compliance, reputational damage and risk of penalties.
As the first step, you can start by checking what your corporate compliance maturity level is by proceeding with Athennian's Compliance Assessment, measuring your compliance against a benchmark of pre-selected criteria. Or, if you are already looking for effective regulatory compliance solutions that can streamline your compliance operation, please don't hesitate to contact our team and request a free demo.
.png)
.png)
.png)
.png)
.png)
