Regulatory Compliance

What is Regulatory Compliance?

 

Regulatory compliance often sounds like industry jargon. In short, it’s simply when a organization follows (or is compliant with) the various rules, directives, and laws that apply to its operations. These can be regulations found at the local, state, federal, and international levels from government or other authoritative bodies.

While discussions of compliance are often most visible in the healthcare and financial sectors, all businesses abide by regulations at some level, especially when user or private data is involved. And since your environments fall under different laws based on your industry, location, size, and operations, merely keeping up with changing regulations can be a major lift–let alone maintaining compliance with them.

Why is Regulatory Compliance Important?

 

Regulatory compliance is important for a few reasons:

• Local, state, federal, and international regulations are often created (and continually revised) for the protection of customers, workers, stakeholders and the organizations themselves.

• Compliance often includes the proper handling of sensitive information (like customer data), standards for safe working conditions, and appropriate privacy and business transparency protection.

• Compliance can protect you from costly fines and liability lawsuits.

• Practicing compliance with all applicable rules and regulations indicates to partners, customers and stakeholders that you’re a trusted and safe choice.

Penalties for Non-Compliance

 

Since most regulations exist for the purposes of safety or protection, non-compliance means that you’re putting your customers, partners, and organization at risk. This can include physical, financial, or security risk. In addition, non-compliance can lead to

• Costly fines – not meeting and maintaining compliance requirements can result in costly fines and penalties; a single data breach costs $9.44 million on average in the US

• Imprisonment - breaking health and safety laws, ignoring environmental regulations, and even making willfully false statements on financial reports can incur years-long prison terms.

• Loss of reputation - this means revenue and productivity loss, broken or missed partnerships, and long-lasting damage to your brand that may take years to recover

Types of Regulatory Compliance

 

What it means to stay compliant varies by organization–it depends on your industry, size, location(s), and other factors that make “compliance” an often confusing and moving target. While not a complete list, here are examples of common regulations and how Flexential Professional Services bridge the gaps.

PCI DSS Compliance

 

• Stands for Payment Card Industry Data Security Standard.

• A set of security standards designed to ensure all companies that accept, process, store, or transmit credit card info maintain a secure environment.

• Includes 12 requirements to maintain PCI DSS compliance.

• Flexential’s PCI Qualified Security Assessors can provide services like PCI Risk Assessments, PCI Gap Analyses, Self-Assessment Questionnaire (SAQ) Assistance, Reports on Compliance (ROC), Cloud Compliance Reporting and more.

HIPAA Compliance

 

• Stands for Health Insurance Portability and Accountability Act.

• A US federal law to protect sensitive patient health information from being disclosed without patient consent or knowledge.

• Features five main rules, around 1. Privacy 2. Security 3. Transactions 4. Identifiers 5. Enforcement.

• Flexential’s HealthCare Information Security and Privacy Practitioners offer HIPAA Compliance Gap Analyses, HIPAA Compliance Assessments,  HIPAA Risk Assessments, and Cloud Compliance Reporting & Enablement.

ISO Compliance

 

• Stands for International Organization for Standardization.

• ISO publishes frameworks that covers a wide range of business processes, including health and safety, energy management, environment, food safety, and IT security.

• ISO compliance certification acts as a clear trust signal to prospective customers.

• Flexential Professional Services provides services for  ISO 27001 including a Gap Analyses and ISMS Maturity Assessments for ISO 27001, a specific framework for infosec management systems (ISMS).

NIST Compliance

 

• Stands for National Institute for Standards and Technology.

• NIST creates standards for the US federal government and organizations that wish to do business with them, the including security, privacy controls and risk assessment guidance.

• Flexential Professional Services offers Gap Analyses and Security Assessments for NIST SP 800-53 (security and privacy) and Risk Assessments for NIST SP 800-30 (risk assessment guidance and maintenance).

Regulatory Compliance Across Industries

 

The federal and international standards and regulations above are just a few examples of the thousands of standards that exist for businesses around the world. While some industries (like healthcare, IT, and finance) are more heavily regulated than others, many organizations have to report on industry or internal compliances for safety and business continuity. Some examples of other far-reaching standards include:

• HITECH - Health Information Technology for Economic and Clinical Health,

• SOX - Sarbanes-Oxley, which oversees internal accounting for publicly traded companies,

• GDPR - General Data Protection Regulation,

• FERPA - Family Educational Rights and Privacy Act,

• NERC - North American Electric Reliability Corporation, and

• CCPA - California Consumer Privacy Act of 2018.

The wrinkle is that regulations are always changing. Often due to more awareness, better technology, or new processes, laws that affect a business’s operations regularly iterate. That means staying aware of and responding to changing compliance requirements is expensive and more than a full-time job. 

And if your organization is already tasked with facing multiple security- and privacy-related regulations, non-compliance becomes costly.

Best Practices to Ensure Regulatory Compliance

 

Often the most cost-effective way to ensure regulatory compliance is consultation with compliance experts. An effective partner will take the time to learn your organization’s specific regulations, understand the assets at stake, discover gaps in compliance, partner on remediation, and provide actionable recommendations and program development.

The benefit is two-fold: you get an expert assistance on compliance in an increasingly complex regulatory environment, and you get back the internal bandwidth to focus on strategic and bottom-line initiatives that grow your business.

Whether you choose to go it alone or partner with a compliance expert, here’s what’s needed for a comprehensive regulatory compliance policy.

Stay on Top of Regulatory Changes

 

Regulations at all levels are prone to updates, which means you need to stay abreast of changing rules and laws. Pleading ignorance to a recent regulatory change generally doesn’t protect you from the costly consequences of non-compliance.

Complete a Compliance Audit

 

After confirming which local, state, federal, and international regulations your business falls under, you’ll need to complete a comprehensive audit to establish a baseline and identify problem areas. It’s also a good idea to track how much previous compliance violations have cost your organization. That way, you know what to spend to mitigate future violations.

Train Employees

 

Completing an audit and identifying areas for improvement won’t mean much if your workforce isn’t on board. And simply having a generic policies and procedures manual isn’t enough. Your content audit should include the specific compliance areas that need attention—data security, internal communications, processes, policies, etc.—along with a training plan and scheduled reviews to accommodate regulation changes.

Monitor for Compliance

 

The key to maintaining compliance lies in transparent, always-on monitoring. Many instances of non-compliance are not willful or malicious but accidental; that doesn’t change the fact that they are unlawful and subject to business-altering consequences.

You need to ensure 1) your workforce has been made aware of and signed off on compliance policies, 2) those policies are trackable and enforceable, and 3) compliance updates are seamless and do not interrupt operations.

Designate a Compliance Officer

 

Especially if you plan to keep regulatory compliance in-house, it’s helpful to have a Chief Compliance Officer (CCO). This role will be largely responsible for overseeing the recommendations given here, and most importantly will help inform a culture of compliance that every organization needs to avoid costly fines, reputational damage, and worse.

Implement a Regulatory Compliance Policy Today

 

Look in the news to see that recovery from frequent compliance violations is a costly uphill slog–if not downright impossible. A benchmark study from an international software developer found that organizations lose an average of $5.87 million in revenue from a single non-compliance event. When totaling the hidden costs resulting from business disruption and reputational damage, that number climbs to $14 million for a single event.

But implementing and maintaining a regulatory compliance policy can require a team of full-time experts.

Flexential takes the workload off your plate, giving you the hours back for strategic initiatives and new growth. Flexential Professional Services’ highly certified and experienced compliance experts provide assessments, actionable recommendations, detailed remediation guidance, and program development to establish and maintain your specific compliance program(s).

This includes regulations and standards like PCI DSS, HIPAA, ISO & NIST, and privacy regulations like CCPA and GDPR.

 

Whether you need to implement a new compliance policy, overhaul your current policies and procedures, or get expert help with compliance gap remediation, Flexential Professional Services provides tailored services based on your industry, size, and specific needs. Reach out today to start the discussion and get a quote.