The recent scourge of data breaches saw some of the largest companies make headlines for all the wrong reasons over the last 12 months. The personal data of millions of individuals was compromised; ensuring security and compliance is a crucial factor for consumers.
Consumers support the introduction of stronger regulations and are seeking organisations that prioritise security, privacy, and anonymity – all of which are underpinned by compliance.
Despite this, the biggest mistake that many startups make is treating compliance as an afterthought that they can address down the road. It may be tempting to neglect compliance when resources are scarce, but it needs to be woven into your DNA from the outset, rather than bolted on later. Many startups of all sizes continue to begrudgingly view compliance as nothing more than a regulatory requirement, rather than recognising its benefits.
How can startups achieve compliance?
From purely a return on investment (ROI) perspective, early investment in compliance can pay for itself many times over if it means ultimately avoiding devastating data breaches, lawsuits and fines. When you look at the big picture, compliance is also the foundation of trust, which allows startups to attract and retain new customers as they scale.
Focus on people
The next mistake that many startups and SMEs make is forgetting that, just like security, compliance is about people. It’s not simply a technological safeguard or a checkbox on a to-do list. Neglecting the human element of compliance presents a significant business risk.
From day one, you need to engage your people and cultivate a compliance culture where everyone across the business understands its importance and knows how to play their part. Along with awareness, this involves ensuring your people have the training and resources they need to ensure compliance is addressed in every aspect of their day-to-day job.
Additionally, rewarding those who do the right thing, and motivating those who don’t, is crucial to ensure that your people aren’t just paying lip service to your compliance goals.
Address it at the highest levels
For a compliance culture to be effective, it needs to come from the top down. Compliance is about mitigating risk, and needs to be addressed at the highest levels. Yet many mistakenly view compliance as simply a technical challenge that can be delegated to the IT team.
Compliance must be embedded in the business model and must align with all preset business goals. This particularly becomes clear once you appreciate the best practices for handling customer data during onboarding and verification in order to improve business outcomes, such as reducing customer attrition and increasing their value. At this point, compliance is far from a burden, it can actually become part of your value proposition in the long run.
Recognise you need help
Even when startups and SMEs do recognise the importance of addressing compliance early, the final mistake they make is assuming they can handle it all by themselves. It’s vital for startups and SMEs to engage subject matter experts and trusted service providers to ensure their compliance posture, policies and procedures address their specific needs.
There’s no one-size-fits-all solution, even within specific sectors. Regulations change, as do threats, so you can’t treat compliance as a generic one-off, set-and-forget task.
Compliance needs to respond to your changing environment, which requires ongoing internal and external audits, incorporating the findings to ensure continual improvement – not simply to remain compliant but to ensure that compliance continues to best serve the business.
Startups must do their due diligence when picking compliance partners. For example, providers in the identity verification industry vary significantly in how they store personally identifiable information and can make misleading claims about their compliance standards.
Look for partners who are certified and adhere to the highest industry standards and regulations. A privacy and security-first approach ensures your selected partner is constantly evolving to meet changing compliance obligations and consumer expectations – allowing you to leverage compliance as a competitive advantage to stake your claim in the market.
Dr Memoona J. Anwar is the Chief Compliance & Innovation Officer at Data Zoo.
