Cloudserv Importance of Compliance Management for Businesses in India
Every organization’s base is one core thing that is ‘people’. Without people, no company can operate. These people are organization’s representatives, it’s assets, the resources who work to fulfil company’s mission. For an organization to work well, employee and employer relationship should be composed and smoothed out, with appropriate norms and regulations. The legal framework of regulations to be considered when dealing with employees is known as statutory compliances.
In HR (Human Resources) term, statutory compliance is a legal process which every business or company must follow with respect to managing employees.
Statutory compliance relates to the various labour and taxation laws pervasive in India. These regulations change on a National and State level, and it is required for companies to obey them. Being non-compliance with these regulations can lead a company into legal trouble for example, penalties, fines, or worse. This is the reason organizations spend in resources for ensuring statutory compliance.
When a business is statutorily compliant, it saves thee organization from legal troubles, but also leads itself to a concrete growth. Some of the major benefits of statutory compliances in a business are as follows:
When a business has successfully complied with every required statutory compliance and regulations, it becomes easy for the management to focus on actual area which needs attention in business. Basically, it frees up time and resources to focus on its core business innovations and activities which inevitably leads to improved productivity and efficiency which leads to business growth.
Now this is the core reason to walk with statutory compliances. It helps a business to avoid obvious consequences of non-compliance such as disqualification of directors/officers, imprisonment or penal liabilities against its directors/officers, payment of fines and/or penalties, suspension/revocation of licenses, lawsuits, work stoppages and in extreme circumstances, complete shutdown of businesses.
Adhering to statutory compliance helps businesses improve quality of their products and services, by enabling businesses to focus on their core business activities instead of investing time and to other non-important activities.
Compliance with the required laws and regulations gives employees of the organization a safe and assured working environment. It reflects organization’s capability and readiness to address and resolve any labour and employment law issues. When a business complies with all its labour and employment law requirements including data privacy compliance, it instils confidence among employees that the organization they are working for. This generates a healthy work environment leading to happier and increasingly satisfied employees, which means that they are highly likely to stay with the entity, thus leading to higher employee retention by the business entity.
The organization can have a competitive advantage as they have a proven track record of being fully compliant and results in good reputation and goodwill. When your business complies with required laws and regulations, you need not to worry about your image in competitive market specially in legal terms.
Companies that do not conform to the rules and regulations specified by the authorities run the risk of non-compliance and this may have heavy implications on the bottom line of the business.
In the present situation where businesses are already facing a lot, many companies have started to pay close attention on every single detail which can affect business from any way.
Statutory compliance management is one of the most important aspect to look when you run an organization.
However, compliance is not a one-time event. Organizations need to take a proactive approach and update their compliance programs to make them more efficient and effective so that they can concentrate on their core offerings.
There are vendors who can take care of your company’s statutory compliances with expertise. They pull a lot of load from your head.