Compliance Framework Meaning: What Is a Compliance Framework
Compliance framework is a set of guidelines that helps the organization follow rules and regulations. This framework basically explains how a company will stick to the rules and laws.
More importantly, it shows what standards your organization needs to follow and how to do it the right way.
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If we describe it in simple words, the compliance framework shows how a company tasks about rules, controls risks, and follow all the good practices to ensure that they remain in line with the regulations and laws despite the change that comes in the rules.
What Are the Three Types of Compliance?
Here are the three types of compliance:
1. Regulatory Compliance
Regulatory compliance is basically related to when a business follows both local and international laws relevant to its operations.
It depends on which industry your business is in and according to that the requirements of such compliance may vary.
Such compliance helps the business build trust with the customers because that is one thing that takes a long time to develop.
2. HR Compliance
All your business policies and procedures come under HR compliance. This compliance is there to make sure that you operate your business lawfully and take good care of your employees. It ensures that no employee rights are exploited in your company.
It covers everything like maintaining employee documentation, recruitment process, how and when to pay overtime, hiring, and employee benefits. Having an HR compliant company ensures that you have a happy workforce, which is productive and works hard to make sure that your company grows and makes profit.
3. Data Compliance
Data compliance means that all the data you collect and store is legally collected, organized, stored, and managed.
As per Compliance Online, “Data is the fuel of decision making, continuous improvement, quality and demonstration of clinical value. Data is to an organization what fuel is to a car. If the fuel is contaminated, it damages the engine. If the integrity of the data is at risk, it can damage the organization’s reputation and can even lead to the extent of business shutdown.”
Aspects of a Compliance Framework
Some of the components of compliance framework are the following:
- To make the data more secure and private. To ensure this, your compliance framework will include rules like using encryption, monitoring who in the organization can access which data, and observing how the data is being used.
- To avoid any legal and money troubles in the company. This is no news that if you do not follow the rules and regulations, you may fall into a legal trouble. Plus, it won’t just require money, but it’ll also ruin the reputation of your company. So, making sure that you have a compliance framework in place that you follow will keep you away from such problems.
- It helps you build trust with your customers. Because listen, if you want to build trust with your customers, you start by handling their data properly. And this type of framework ensures that you do it the right way, and build trust with your customers and maintain your reputation.
- It makes your work easier and makes sure that everything works in the best way possible.
- It can also help your business go global as the compliance framework can guide you on dealing with international rules.
Steps in Building a Compliance Framework
To build a compliance framework follow these steps:
- The number one step is actually to know the rules that you have to follow. It includes all the laws and regulations that apply your business.
- Step two is to check your current positioning. It means reviewing what you already have in place by looking at your systems, processes, and documents.
- Finally, when you have an idea of what rules you need to follow and what is the conditions like in your organization right now including what rules are currently in you’re compliant with and how the rules are being followed, you build a better system. This step will mainly involve creating all new processes to meet the rules you have identified in the first step.
How to Review the Regulatory Compliance Framework
To review it, set up a review team that will handle this and then, with your team’s help, review all the rules and regulations you have set and examine the documents.
What Are the 4 Phases of Compliance Process?
The four main phases of compliance process are
- Compliance risk identification
- Compliance risk assessment
- Compliance risk management
- Compliance monitoring