Why compliance must remain a priority for the CEO

October 9, 2019

Being the CEO of a sizable company is without doubt, a hugely demanding role. The person at the top of the organisation is ultimately responsible for everything that company does and a small inventory of just some of the responsibilities would include:

Defining and maintaining the company culture; making sure employees are happy and motivated, ensuring that the books are balanced and that the company is making money; managing people across the business; acting as the company figurehead and public spokesperson; keeping shareholders, investors and customers happy; and ensuring the company is governed and run in the right way – the buck stops with the CEO on many issues.

It’s open to debate just how involved CEOS should be in the day-to-day activities of their organisation. All business functions are important, but there is certainly a case for the CEO to be more involved in compliance than marketing, for example.

Compliance is so important in modern business and can impact so many different parts of the organisation. A CEO isn’t going to be logging upcoming compliance requirement deadlines of course, but it’s vital that he or she retains a healthy interest and understanding of compliance and the broader GRC function. This is why.

GRC and its place within the organisation

We have written before about the growing importance of compliance in modern business, but it’s worth reinforcing now. Where compliance was once perceived as a box-ticking exercise it has grown in importance and value over the last decade and a half.

Compliance – in conjunction with governance and risk forming the combined GRC team that is becoming the norm in many businesses – is now one of the most important functions in any organisation. The GRC team set the corporate culture in an organisation, defining how that company is perceived by the wider world. They are also responsible for ensuring that the business remains compliant with any and all regulatory requirements.

There is more regulation now than there has ever been and staying on top of it all is a challenge. That’s why the GRC software industry has emerged and why so many GRC vendors are now regarded as amongst the key suppliers to a business.

Should an organisation fall foul of compliance requirements, the consequences are huge. Whether that’s an enormous fine for GDPR non-compliance, having to postpone trading temporarily or seeing the long-term brand damage caused by poor compliance, no organisation wants to suffer such consequences. So, CEOs must have at least an awareness of the GRC function and what is can bring to a business.

Big decisions and big risks

But beyond that, there are other reasons that a CEO must retain a strong involvement in GRC and for it to remain a priority for them. While it is said that the mark of a good leader is to surround themselves with the very best people they can, there are times when major decisions must be made and it falls to the CEO to make those decisions.

When you are talking about something as important as a product recall, or whether the expand into a new market or not, the risk involved in those decisions is considerable. A CEO needs to have as much information as possible relating to that risk, with a number of models and scenarios available to help them understand what may or may not happen.

The effective management and mitigation of risk is something that no CEO could really do without. It provides a safety net for some of those big decisions and allows the CEO to be informed and aware of all eventualities when making a decision. To benefit from such intelligence an organisation (and the CEO that heads it up) needs the right GRC solution.

The need for a GRC solution

The CEO needn’t be hands on in matters of compliance and GRC and they certainly need never get involved in the day-to-day use of a GRC solution or GRC tool. But having a working knowledge of major compliance, any upcoming requirements and the consequences of non-compliance is imperative. Likewise, having the information to make informed decisions with the right level of risk is an integral part of the CEO’s role.

It stands to reason then, that any organisation needs a GRC team that the CEO can trust, and which has a direct line to that CEO. That team would be remunerated accordingly and would be equipped with the very best GRC tools to do their job.

Such a GRC tool, like one of Oxial’s sGRC solutions is essential for efficient and effective management of GRC. The best tools will even allow a CEO to check in when they want or need to – getting the required information quickly and easily.

Compliance should be very much a priority for any CEO and part of that is getting the right GRC solution for the organisation. To learn more about Oxial’s sGRC solutions – powerful and cost-effective enough to impress any CEO – please get in touch with us here.