Regulatory standards exist for a variety of different reasons. In many cases, these regulations are in place to prevent businesses from acting in ways that might be contrary to the continued safety and happiness of the community. Organisations have a responsibility to provide quality products and services, and to operate in such a way that does not mislead or put their customers or others at risk. Compliance may also help promote ‘fair play’ within the market, establishing guidelines for businesses to follow when dealing with competitors.
Ethical issues are often at the heart of government regulations. Failure to operate within these laws may result in severe penalties for businesses, including fines, jail time for company executives, or even forced closure or retooling of the business itself.
Of course, ethical concerns are not the only motivation behind business regulation. Establishing standards, laws and best practices can create a competitive advantage. For one thing, customers are likely to be more willing to work with a company that adheres to vital processes and procedures. At the same time, many of these procedures exist to promote better management of the business itself, and organisations may see improvements across the board when they comply with established standards, laws and best practices. This is particularly apparent regarding company IT systems.
- Compliance management in IT provides the following benefits for businesses:
- Ensuring that essential approvals are collected before specific actions can be taken (such as IT updates or emergency patches).
- Guaranteeing that financials are being accurately and consistently reported.
- Preventing risk to sensitive customer, supplier, employee and company data.
- Establishing service level agreements (SLAs) to ensure that vulnerabilities are discovered and addressed within a timely fashion.
- Identifying escalation paths or notification chains.