Every company is obliged to comply with laws and regulations. The amount of compliance varies by country, industry and size of company, with some industries such as banking more highly regulated than others. An example of a law is the Data Protection Act 2018 that every company must comply with.
To become compliant, and equally importantly, remain compliant companies are obliged to spend time, effort and money so that they can go continue to go about business as usual. The penalties for not complying and breaking these laws and regulations vary from fines to a company being permanently closed down and in some cases imprisonment for the company directors.
As well as complying with laws and regulations, companies may also choose to comply with policies and guidelines. Although these may not be mandatory, they are important as they demonstrate the attainment of a minimum standard. ISO standards are a good example of this as they are internationally recognised minimum standards in a particular area that are designed to provide confidence and trust in the company that has them. An example is ISO 14001, the Environmental Management Certificate.
Just as companies spend time and money to become compliant themselves so they want to work with suppliers who are also compliant. Proving compliance is becoming increasingly important for companies to be invited to tender for new business and to continue working with clients. In some circumstances working with non-compliant suppliers may put the company in unnecessary risk, through no fault of their own.
It’s therefore important to ensure that companies work with suppliers who maintain their compliance. One easily made mistake is to obtain proof of compliance at the beginning of a contract and to then not check that these documents are renewed when they expire. Usually, the supplier will continue to be compliant, however there is the risk that they don’t.
One solution to this problem is to use a Supplier Management software as, amongst other things, it provides an easily accessible repository of supplier documentation that proves supplier compliance. It will also automatically warn when documentation is going to expire and needs renewing and allow users to check and approve the documents.
For many companies, especially larger ones, who have more resources, it easier to create process and to monitor supplier compliance. For those smaller companies, with fewer resources there is one Supplier Management solution that enables SMEs to easily track supplier compliance. oboloo is an intuitive self-service solution that also incorporates Sourcing, Contract and Savings Management to enable companies to be supplier smart. To learn more please visit www.oboloo.com
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