What is compliance?

Compliance is sector-independent and can therefore be applied in various organizations and companies. For the financial sector, for example, this means introducing and complying with rules imposed on companies and institutions by both the government and the financial regulators.

What makes compliance important to organizations?

The purpose of compliance is to reduce risks and avoid any damage that arises when you as an organization do not comply with the applicable laws and regulations. Compliance relates to rules for the entire sector, but sometimes also refers to internal regulations.

Compliance is more than just communicating the applicable regulations within your company. Compliance with the rules must also be actually monitored by someone. Many financial institutions employ compliance officers for this. They ensure that the rules are complied with internally and that people work according to the standards.

Organizations must also be accountable externally. They demonstrate compliance with the rules through a compliance officer.

For example, if an organization does not realize that rules are changing and continues in the same way, they no longer comply with the applicable rules. Then they run the risk of:

     - High fines
     - Damage claims
     - Image damage