In the past few years, many corporates have faced severe issues such as loss in reputation, bankruptcy, etc., due to not following regulations set forth by higher authorities. Corporate compliance involves adherence to both federal laws and regulations and internal company policies. Compliance is crucial for a business to manage a good reputation, prevent losses, and ensure the company's smooth functioning.
The responsibility of corporate compliance often falls on the governing board. As the highest authority within the firm, it is tasked with making sure all the activities are carried out under compliance. The governing body appoints a committee or a chief executive officer to ensure that the organization follows all the prescribed rules and regulations.
Companies also hire individuals as Compliance Officers for this purpose. They will analyze the work carried out by the employees, check if the company has violated any regulations, and help create the firm's internal policies. While being aware of the company's internal rules and standards, the compliance officer will also have sufficient knowledge regarding legal practices and both national and international laws. The Compliance Officer usually reports his findings to the Governing board, the Chief Executive Officer or the Chief Operating Officer. Visit here to know more about corporate compliance.