The importance of Compliance for strengthening companies
The search for Compliance – that is, compliance with legislation and ethical standards – is one of the great challenges facing companies in today’s market. Increasingly, consumers, partners and shareholders (ie, stakeholders) demand transparency, honesty and compliance with the rules in their business relationships.
In this article, we have the support of Luana Lourenço, professor of Governance, Compliance and Business Conflict Management at the Post-Graduation at the Catholic University of Salvador – UCSal – and founder of Ocean Governança Integrada. Luana clarifies the concepts of compliance and their importance in the maritime market, especially given the obstacles imposed by the new coronavirus.
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What is Compliance?
To be in compliance with processes, actions, practices and behaviors is to be in compliance. Organizations increasingly seek to act and encourage all their stakeholders to act within the law, in an ethical and fair manner. For this reason, many of them have been creating compliance areas, which helps to achieve the necessary results, taking into account that qualified and qualified teams for this purpose will lead the actions focused on compliance.
It is important to highlight that the conduct of a company passes through its employees, but also reaches leadership positions. Following the law, cherishing ethical relationships and never giving in to corruptors – at the risk of the individual and the organization becoming corrupt – are the main guidelines for compliance.
In general, companies develop guides or manuals that indicate what is acceptable and what is not tolerated in the organization. The so-called Codes of Conduct have been gaining ground, as they serve as a basis for people’s actions and facilitate the identification of situations in which the rules are circumvented, in addition to providing for possible penalties.
What are the benefits of Compliance for companies?
The biggest benefit of compliance is the increase in trust between the various stakeholders (shareholders and other stakeholders for the business). However, it is essential that measures aimed at conduct are aligned with the company’s organizational culture.
Luana Lourenço lists a number of other benefits that can be realized. Check out:
- the reinforcement of the ethical culture and the consequent increase in good behavior;
- o possibility for new hires, labor or business;
- o attracting more demanding customers and investments;
- recognition by customers;
- the reinforcement of the company’s positive image;
- greater employee engagement with the organization’s purpose;
- o improves the alignment of internal and external communication;
- increasing competitive advantage;
- o medium and long term value creation;
- the best response in dealing with damaging crises to the organization’s image;
- business sustainability;
- the company’s longevity.
What is the role of Compliance in the maritime market?
There are some important details of compliance in the maritime market that must be considered, which further increases the importance of complying with the laws and working ethically with business partners.
“Compliance in the maritime market is notably essential to business, as it is an important sector of the economy that promotes the economic development of the country and the region where companies operate their activities”, highlights Luana.
Firstly, it is necessary to consider that 96% of the products that Brazil exports and 90% of the imported goods pass through national ports, this gives the dimension of the importance of the maritime market, which has the specificity of being at the base of the production chain.
Acting accordingly in the sector is therefore essential. After all, if there is confidence in the base, the tendency is for the other agents in the logistics chain to behave in the same way and to comply with the guidelines and rules established by their contractors.
This generates a demand for extra attention, due to the fact that the main characteristic of the maritime market is transnationality. In addition to complying with the laws and rules of the countries of origin and destination of the goods, compliance with international standards, guidelines, regulations and legislation, such as the Sarbanes-Oxley – SOx Law, of the IMO (International Maritime Organization) rules, among others, is mandatory. others.
Care continues when separating what is public and what is private. After all, maritime operations often involve relationships between both spheres, this requires knowledge and application of public law rules and guidelines related to private law.
Sustainability as an essential factor
Another fundamental factor with regard to compliance is sustainability, which, although many believe it concerns only environmental preservation, actually has two other pillars: the social and the economic. This support tripod must be monitored seriously in order to guarantee good business conduct at each point.
The challenge posed by the new coronavirus
A challenge emerged on the market in 2020: the rules imposed by the new coronavirus require an answer from organizations on a number of issues, and their conduct towards them is essential to keep them operating in the market, in accordance with the limitations established by high risk. contagion.
“The company that aims for exponential growth must be attentive to understand the path we are following”, warns the professor. “Only then will the organization be fully aware of market changes, especially while we are going through a moment of crisis, such as Covid-19, when we still do not have all the answers to our questions”, he adds.
How to implement a Compliance area?
Below, check out some elements necessary for the compliance area to be carried out in the best way.
For a company to implement a compliance sector, first of all, it is necessary to define the professional responsible for the area in the company. In addition, having an ethics committee is key to ensuring that decisions made have a democratic basis and participation by the team – people from different areas should be invited to ensure a systemic vision.
Code of conduct
Having a code of conduct and ensuring its wide dissemination to all stakeholders is also an essential step. It is important that the document is known internally and externally to avoid justifying its ignorance and unethical actions. The sanctions for this behavior should be made clear in the code.
We will note that only the code of conduct does not guarantee that compliance will be achieved. Creating a reporting channel that allows people to report deviations anonymously and be able to resolve them is also critical. “Another use of the channel is to clarify any doubts related to policies and the code of ethics and conduct. The care to preserve the identity of those who use it, ensuring confidentiality and non-retaliation, is very important”, says Luana.
In addition to the points detailed in the article, there are a number of new challenges ahead, due to the so-called “new normal” that everyone will experience after the new coronavirus pandemic. Compliance will certainly come in as a key card at this point!
The establishment of new rules in line with the imposed reality, as well as the use of technologies that facilitate contact and carry out the work in a safe manner by all those involved, will certainly bring impacts with respect to the conduct to be adopted by all. Ethics and compliance with legislation – which may also change – will continue to be a guide to guide everyone’s actions in accordance with best compliance practices.
Wilson Sons, knowing the importance of Compliance for the market, implemented this area a few years ago, following exactly the steps mentioned above. The company has an Ethics Committee, Code of Conduct – followed by all employees – and an external Ombudsman channel for complaints, which guarantees total confidentiality.
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