Every business has a set of rules and regulations that it must uphold. To maintain compliance, businesses must adhere to the regulations and laws specific to their industry. The problem is, these regulations are constantly changing, and failure to stay up-to-date can lead to serious financial strains and damage to company reputation. Let’s explore how effective compliance management can ensure the continuity and security of your organization.
What is compliance management?
Compliance management is the continual process of monitoring and assessing organizational systems to ensure they comply with security standards, regulatory policies, and other industry requirements. Maintaining compliance falls on the shoulders of everyone within the organization. Of course their knowledge and understanding should directly correlate with their role, but all employees should be equipped with a strong understanding of how to adhere to compliance standards in order to ensure data security and smooth business processes.
What is the importance of compliance management?
Industry standards and legal regulations are tightening up as the world becomes more dependent on technology. Compliance management is important because non-compliance can result in legal and financial penalties, security breaches, and damage to your business’ reputation. Comprehensive compliance management systems (CMS) ensure that your business remains compliant with the most recent policies and help to avoid business disruption. Let’s take a look at the top reasons why it is imperative to monitor and manage compliance within your organization.
Noncompliance can lead to serious fines that affect your business’ financial wellbeing. A recent study from Ponemon and Globalscape reports that an organization without a compliance management system in place pays up to 2.71 times more than an organization that adheres to compliance standards. That’s a cost of about $14.82 million annually as a result of noncompliance, versus the $5.47 million it takes to maintain compliance. Appropriately following industry and regulatory standards can save your business an average of $9.35 million each year.
Evaluating security risks
Effective compliance management systems help to evaluate and manage security risks. In addition to written documents, processes and functions, these systems require the use of certain security tools to maintain compliance. Risk assessments evaluate the level of risk associated with your organization and ensure that you have prioritized compliance and established effective measures to avoid potential risks. In addition, continuous monitoring tools can help to identify vulnerable systems, prioritize remediation efforts, patch noncompliant systems, and validate that changes have been made appropriately.
Protecting against data breaches
Failure to follow compliance requirements can result in a sticky situation, like the one Walmart Photo Center encountered in 2015. The photo center data breach allowed hackers to access customers’ credit card details and other personal information (e.g. names, emails, and account passwords) and cost the company a total of 1.3 billion dollars in compensation, legal fees, and account monitoring fees. It was later revealed that Walmart was aware of compliance requirements, but failed to effectively account for them.
What are the challenges of compliance management?
While the importance of compliance management is undeniable, the reason so many companies fall victim to noncompliance is the challenges they face. Here are a few examples:
Constant changes in security and compliance regulations
Change is the only constant within security and compliance. New cyber threats and regulations evolve quickly and require immediate attention to mitigate new risks and maintain good standings.
Large enterprises with high employment
The bigger the enterprise, the higher the risk of noncompliance. With a large number of team members, it can be hard to coordinate compliance initiatives and ensure training across the entire organization. This results in system complexity and can ultimately increase the likelihood of data breach.
Distributed working environments
The transformation of workspaces from on-site to remote work and cloud platforms has made it difficult to get an accurate and complete view of compliance status. As a result, it has been challenging for many organizations to manage and monitor for risks and vulnerabilities.
Best practices for compliance management
The best way to manage compliance is with a multifaceted approach that monitors all environments at once, addresses inconsistencies, and regulates with new compliance mandates. The following best practices can support the aforementioned approach.
Conduct a policy audit
Take inventory of the standards your organization already follows with a policy audit. An audit will reveal any gaps or vulnerabilities within your organization’s policy library and can help prioritize any changes that need to be made.
Provide adequate staff training
An organization is only as strong as their weakest link, so be sure to provide adequate staff training to ensure all team members are aware of your internal compliance standards. Training helps reinforce policies and procedures and improve employee awareness. Schedule recurring training throughout the year to support changes in compliance standards and company policies. Short online sessions can be used to improve compliance without disrupting workflow or availability.
Continuous monitoring and due diligence
Data security and privacy legislation and industry standards require organizations to closely manage their cybersecurity posture and maintain governance over their entire supply chain. Although privacy and security differ, they do go hand-in-hand. Today’s privacy laws require organizations to consider “privacy by design” or “security by design,” suggesting the use of continuous monitoring solutions. It is also imperative that organizations perform due diligence on third-party vendors to ensure they are adhering to industry standards and organizational rules.
How to introduce a compliance management system
A compliance management system integrates tools, processes, written documents, and functions to help organizations manage risk and maintain compliance with regulations. The CMS limits a business’ risk of noncompliance by providing employees the tools and resources necessary to ensure compliance is maintained at all times.
SecurityScorecards continuous monitoring solutions help organizations achieve, maintain and enable cybersecurity compliance with leading regulations and industry standards. We constantly monitor your organization’s entire ecosystem and detect potential gaps that could result in non-compliance with current security regulations. We map directly to compliance frameworks to support a strong cybersecurity posture and visibility into potential risks. With insights from SSC’s continuous monitoring solution, organizations gain visibility into their cybersecurity posture and are better equipped to maintain industry compliance. Learn more about how SecurityScorecard can minimize the risk of noncompliance.