Regulatory readiness – Practical tips to get it right

Today organizations need to be on their toes to stay up-to-date with the complex and rapidly evolving regulatory changes. And if organizations are not ready, it may take them up to a year to implement all the regulatory changes. This can have several implications, including impacting revenue and lawsuits.

This article will cover some practical tips to help your organization develop a robust change management framework for its regulatory readiness.

The need for regulatory readiness

While in the pre-financial meltdown era, companies could still manually keep track of regulatory changes, today, as regulators constantly brought in new regulations, many organizations are grappling to keep up with the pace. The traditional wait-and-watch approach is no longer applicable. Organizations need a solid regulatory change management framework with the right set of tools to be regulatory-ready.

7 Practical tips for regulatory readiness

1. Standardizing regulatory taxonomy

It’s always challenging for compliance officers as they have to deal with inconsistencies in the regulatory details across geographies. A standardized regulatory taxonomy means more consistent language, terminology, and structure. Having a unified regulatory taxonomy will facilitate better communication between stakeholders, easy access to information, and create a robust change management framework easily. Investing in a GRC repository like VComply can help store all the regulatory updates in one platform, index the information according to the organizational hierarchy, and map them to different GRC attributes.

2. Keep a tab on regulatory changes

You need to constantly keep a tab on all the regulatory changes happening both on the global and regional front from a multitude of sources. These include industry associations, regulatory publications, national and local media, and special content providers. Needless to say, the data volume is high, and it’s practically impossible to scout the relevant data and analyze it. It’s time-consuming and needs a large team if you need to do it manually.

The need of the hour is a cloud-based platform that can be your one-stop solution for all your regulatory content. This means you don’t need to hop on various sources to gather information. Compliance professionals can curate information from this single platform depending on their requirements. Organizations can also set predefined rules so that you receive an update on your feed whenever there are any regulatory changes. This will help compliance officers to stay on top of the regulatory changes and take necessary actions before it’s too late.

3. Measuring the business impact

Each regulatory update needs to be assessed in terms of business impact. After an initial assessment, different organizational functions can carry out a detailed assessment to identify which risks, policies, controls, procedures, and reports will be affected and needs intervention for revision. Along with measuring the business impact, you also need to group similar regulatory updates to remove any possibilities of duplicity and give a holistic view of the overall impact across the organization. Investing in a GRC tool can help you get a comprehensive view at any point in time of the different types of regulatory updates that are affecting the business.

4. Assigning responsibilities

You need to assign responsibilities to ensure you are ready to track regulatory changes and implement necessary changes promptly. This will build ownership and accountability; every user involved should know what they need to do. While a centralized GRC tool can give quick access to regulatory updates, teams need to access it on time and be able to analyze it and take necessary action. To achieve this, organizations need to identify SMEs who understand regulatory updates and assign them responsibilities. Start with applying different levels of screening. For example, in the first screening layer, a centralized regulatory coordinator will assess the regulatory update and send it to the relevant department. The SMEs can take it up from there.

5. Implementing the regulatory changes

You must have a strong action plan and delegate responsibilities to implement regulatory changes. A standard SOP is a must that should include the detailed review process and the entire workflow. Opting for a GRC tool can help you streamline the workflow and send notifications to the employees when a task is assigned to them. This will ensure that nothing goes amiss and everything is on track. Additionally, a centralized tool like VComply can give you a quick insight into different workflow stages from a single dashboard and easy access to reports. Once SMEs are identified, it is important to document all the roles and responsibilities. Finally, while each task will be assigned to an SME, the compliance officer needs to be involved at every stage to ensure a smooth workflow.

6. Having strong internal controls

To have a robust regulatory change management framework, policies, procedures, and internal controls have key roles. So before anything else, you must ensure your policies, procedures, and internal controls are in place. Next, you must establish adequate infrastructure for optimal policy communication. You must develop new policies and communicate organization-wide, train your staff on the new policies, and encourage them to stick to the new guidelines. Remember, the policies will offer the first defense against new regulatory changes. Training the staff on the new policies is equally important too.

7. Conduct regulatory readiness audit

To determine your regulatory readiness, conduct an audit from time to time. Identify and improve the gaps to ensure that your regulatory readiness is always on point.

Conclusion

Regulatory readiness is essential to ensure that you are a step ahead always. Remember, setting up a process and regular monitoring is the key to success.