What Are the 7 Elements of Compliance?

What Are the 7 Elements of Compliance?

– By Shea Karssing

April 19, 2023

The 7 Elements of Compliance Made Smarter Through Data

In today’s regulatory environment, the 7 elements of compliance are more important than ever in creating a meaningful culture of compliance within businesses and organisations. From SMEs to multinational corporations, adopting the 7 elements of compliance helps organisations to meet compliance objectives and evidence commitment to compliance. 

Across all businesses, this could cover everything from financial reporting to fire safety, legionella monitoring, and environmental regulations. Together, these elements provide practical advantages for the achievement of compliance standards great and small. 

The 7 elements of compliance program is well-established, but is being simplified and enhanced through IoT smart technologies. In this blog, we outline the 7 elements of an effective compliance program and outline the benefits brought by smart compliance technologies and smart buildings to the overall compliance process for building and health and safety compliance.  

Why is it important to implement the 7 elements of compliance program?

The 7 elements of compliance were initially devised to mitigate the effects of corruption and fraud conducted by officers of corporations. Today, these elements have found widespread application in businesses of all sizes and across many spheres of compliance. 

In a constantly shifting business landscape, it is used as a robust and resilient method of securing compliance interests and safeguarding companies from the reputational and financial damage that comes from non-compliance. In an increasingly globalised world, regulation is becoming robust in order to police multinational operations. 

The result is a complex web of policies, procedures, and controls that sometimes differ from country to country. The 7 elements of compliance were compiled to guide compliance best practice in the United States and have since evolved to encompass additional considerations and multiple country considerations. 

For example, the effectiveness of a compliance programme is one of the considerations in prosecuting serious fraud cases in the UK. ‘Genuinely proactive’ compliance programmes are mitigating when considering prosecutions.

While there is no one-size-fits all application of the elements, they serve as a useful tool in securing an effective compliance programme. This mitigates risks and reduces the chance of exposure to investigations and legal backlash for non-compliance.

What are the 7 elements of compliance and how are they benefitting from smart technologies?

1 – Establish and Implement Policies and Procedures

The first step to adhering to compliance policies and procedures is for these to be known. Compliance policies and procedures need to be written, easily accessible, and easy to understand. The extent of this will depend on the kind of industry involved, but this will provide clarity on compliance parameters.

These policies and procedures need to be devised with regulations in mind, but also with due consideration to unique risk assessments of each organisation. These risk assessments need to be conducted on an ongoing basis. Analysis of long-term data is useful in guiding the most comprehensive and accurate risk assessments.

2 – Delegate Responsibility to Compliance Personnel

The most effective compliance programmes are monitored and managed. A compliance officer and/or committee needs the required authority and resources to ensure the daily adherence to these policies.

This is the next point upon which smart building management solutions have an impact. The automated collection of data in real time means monitoring can take place continuously – and these officers can react to pre-programmable alerts on undesirable changes. These notifications are sent to a remotely accessible dashboard for immediate action across multi-site concerns.

3 – Compliance Training

Regular compliance training and education supports ongoing adherence to policies and procedures. 

4 – Reporting and Communication

The business or organisation needs to create channels for anonymous reporting by employees and stakeholders. Of critical importance here is the security and prompt response to reported instances of non-compliance.

This plays into the next element but, from a building compliance perspective, secure and real-time reporting around instances of non-compliance is again best achieved by data-driven IoT smart technologies.

5 – Monitoring and Auditing

This element requires risk to be reviewed and any potential risks to be adequately addressed with compliance in mind. This is an element that stands to be revolutionised by the implementation of smart compliance technologies like those from Smarter Technologies Group

Not only does long-term data inform ongoing risk reviews in significantly more detail; the real-time monitoring capabilities and reporting functionality of these processes mean risks can be addressed urgently and as they happen. This reduces risk and safeguards staff, business interests, and compliance efforts.

6 – Blanket Appplication and Enforcement

These policies and procedures need to be applied throughout the business or organisation and disciplinary guidelines should be consistently applied to everyone involved. This is something that requires ongoing monitoring and review to ensure everyone is involved in meeting compliance imperatives.

7 – Resolution

How your organisation responds to instances of non-compliance is arguably indicative of the programme’s success. Monitoring is one thing, but it is action that defines the effectiveness of compliance efforts. Important considerations include:

  • How the instance of non-compliance is detected and the methods of ensuring this is done as fast as possible
  • How the time period for corrective action is reduced
  • How corrective action is enforced
  • How the instance of non-compliance – and the actions taken for resolution – are documented and recorded

This is another way that real-time monitoring and reporting create an opportunity for expedited action. Additionally, cloud-based data monitoring simplifies record-keeping for low-effort, comprehensive reporting around compliance. 

Practical examples of smart compliance technologies in action

  • Smart building energy monitoring isolates areas of wasted or high consumption and drives long-term energy strategies. This helps businesses to meet environmental compliance regulations and operate more sustainably.
  • Air quality monitoring includes air pollution monitoring and air monitoring for ongoing oversight of these vital wellness metrics.
  • Legionella monitoring is traditionally labour intensive and subject to human error. Smart automated monitoring and flushing technologies automate this process and send real-time alerts whenever concerning levels are detected. 
  • Smart fire safety monitoring covers everything from device monitoring and testing to detection and automated response. It can also be used to assist firefighters in firefighting efforts.

What is the most important element of a compliance program?

The 7 elements of compliance are most effective when they work together. However, response to instances of non-compliance is arguably the most important element. An investment into how – and how fast – compliance issues are detected puts the power in the hands of responders to rectify issues as quickly and effectively as possible. 
Ultimately, smart technology additions have the potential to support the 7 elements of compliance and complement workplace health and safety at the same time. Make the change to smart compliance technologies today. Contact Smarter Technologies Group for more information.

Contact us today to see how Orion™ The Real-Time Data Network can benefit your business.

Our experts are on-hand to advise you on the most efficient and cost-effective smart technology solutions for your business’ needs.

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