regulatory compliance software
Legal11 January, 2021

Why the general counsel should care about regulatory compliance software

Compliance and risk management are top priorities according to legal departments across Europe, but there’s still work to be done. According to the Legal Departments in a Digital Era report, by Wolters Kluwer and the European Company Lawyer Association, 72% of legal departments say compliance and risk management are highly important. However, the same report found that 34% rate the maturity level of compliance and risk management as advanced, while an additional 42% say the maturity level is intermediate. Clearly, there’s a discrepancy between the importance of compliance and risk to legal departments and the maturity level.

One explanation for this is because the general counsel’s role is tricky when it comes to compliance. Who owns compliance within the organisation? In some organisations, the general counsel may be only responsible for risk management, while the compliance officer is responsible for compliance. In other organisations, the general counsel is responsible for regulatory compliance based on the idea that compliance is a legal matter. Evidently, the general counsel’s role in compliance matters depends on the size and structure but the general counsel will probably have some responsibility for compliance. In this article, you’ll learn why the general counsel should care about compliance and how leveraging technology can help.

Regulatory obligations pose a challenge for legal departments

Regulatory compliance is challenging for legal departments of all sizes because regulations change constantly and are growing more complex. It’s not surprising that many legal departments struggle to keep up with regulatory obligations, especially if they have to report to multiple regulatory bodies. Some of the challenges legal departments face regarding compliance are:

  • Each department in the organisation operates in a silo with its own policies and compliance processes. When there’s little transparency it becomes difficult to assess risks and how they affect the company.
  • Regulatory obligations are increasing and becoming more complex, which translates into an increase in requirements. Organisations that fail to comply are subject to heavy fines and penalties, not to mention damage to their reputation.
  • Many organisations struggle with document management, from not knowing where documents are stored or whether everybody has access to the latest version. This becomes even more complicated when organisations rely on a manual approach to storing and gathering data.
  • Putting together compliance programs can be overwhelming. Where do you start and who is responsible? How do you go about determining what compliance processes and technology you need to put in place?

Staying in control with regulatory compliance management software

Legal departments have realised that digitalising their compliance processes can add transparency and help them keep track of regulatory obligations. The advantage of regulatory compliance management software is that it provides a single source of truth. Legal departments can reduce the amount of time spent on gathering and filing documents. When all documents and policies are centralised, legal departments don’t have to worry about the potential repercussions associated with non-compliance.

At the same time, legal compliance software helps organisations to monitor any important deadlines. With all the documents in one place, it’s easier to stay on top of deadlines for key dates. Legal departments greatly reduce the chance that they miss an important deadline. Legal departments are able to minimise the risk of breaches, and the fines and reputational damage that go along with it.

Improve risk management

Once you have consolidated all of your documents into a cloud-based solution, assessing legal risk becomes easier too. If you don’t know where all of your documents are, how can you be sure that you’ve identified all your risks? Legal compliance software offers clear dashboards with insight into your risks so you can take action in case of an unexpected event. What’s more, you can highlight areas of concern and potential threats to enable informed decision-making and take a proactive approach to risk management. For more information on calculating your legal risk, check out the article on our risk assessment calculator.

Legal compliance software enables tracking and reporting

Suppose your legal department is subject to an audit and you need to gather a list of all the appointments from the past few years and lease contracts with a value of over €100,000. If you rely on manual processes, it might take you days, or even weeks, to compile this information. Even then you’re still unsure whether the information is reliable. With cloud-based legal compliance software, you’re able to generate a report with the requested information within minutes. You can export it so it can be easily shared with the regulatory authorities. Automated reporting greatly reduces the time spent preparing for an audit, but it allows you to spot any gaps in your information quickly, so you can take action. When you cut down the time spent on compiling information, you have more time to focus on high-value, strategic work.

It’s easy for compliance to become a synonym for manual processes. However, it doesn’t have to be. By leveraging regulatory compliance software, you can stay on top of all regulatory obligations and create an action plan for managing risks.

Not sure where to start? Download our whitepaper, 7 steps to manage legal risk, and discover how to leverage technology to create a framework for effective risk management.