With the Compliance Management System, a company wants to promote compliance with laws and guidelines in the company as well as avoid misconduct.
Low risk while increasing efficiency and effectiveness are the major goals of compliance. This can only be achieved through the strategic use of compliance measures.
A compliance management system is therefore indispensable for the modern business world. The purpose of the system is to avoid liability and limit/minimise risk. A good compliance management system can protect companies from expensive processes, high claims for damages and reputation damage. Reputational damage, as well as civil and criminal consequences cause high ideological and financial damages.
Compliance objectives
With a good compliance management system, a company can target the following goals:
- Efficiency and effectiveness
- Motivation of employees
- Limitation and minimisation of risks (avoidance of criminal proceedings and irregularities)
- Opportunities for invitations to participate (public and private award of contracts)
- Improving corporate ratings (creditworthiness, lending and conditions)
- Corruption prevention in sales (customers and suppliers)
- Transparency (Opening, Going Public)
The competent organisation of regular conduct within the company and the proof of a compliance organization are therefore at least advantageous for compliance goals.
At the legal level, there may be antitrust allegations. Compliance protects a company from possible damages caused by antitrust violations, including customers and suppliers. The company's liability risks are shrinking, as is the personal liability of its management bodies.
International companies can benefit in particular from the economic advantages of compliance management, as they naturally come into greater contact with risks. Compliance has an impact on corporate ratings, while opportunities for international financing are growing – as are the prospects for success in tenders and working groups. So, both financially and legally, a company can score with a compliance strategy.
Compliance strategy
In order to develop an optimal strategy, the limitation of four areas is necessary:
Functional dimension
Material dimension
Personal dimension
Territorial dimension
Single Standard
For the development of a compliance strategy, it is important to examine whether the same rules should prevail in a globally operating company for all territorial areas or whether they should vary from region to region. For example, this can lead to a balancing act between marketing and legal design for parent companies and subsidiaries. In this case, a precise consideration of the priorities makes sense.
The same basic rules for all regions are called single standard.
Reputational damage has an enormous setback force on a company. Legally interesting is therefore the design of the supervisory obligations of parent companies vis-à-vis subsidiaries in liability matters such as antitrust infringements. We will help you to design the contract.