5 Tips to Help Founders Take Compliance Seriously
While time is a valuable resource that founders often prefer to use for growth, issues of non-compliance can sink that growth in an instant. Today, India has a more business-friendly government policy, but regulations here and worldwide change every day. The challenge for founders is knowing the exact steps to prevent fines, embarrassment, theft, fraud, and even jail. For founders who are serious about compliance, use the following five tips to get started.
Establish Relationships With Regulators
Regulators can provide guidance and help you clarify issues so you can successfully navigate the compliance requirement relevant to your industry. As Manohar Lal Tandon grew Tandon Magnetics, he invested significant time developing relationships with the Indian government to ensure compliance. Importing and exporting rules in India were complex at that time. For example, if the government rejected materials imported from the United States or Europe, no system existed to return those materials. If companies scrapped the materials, the government penalized them.
This was one of many regulatory challenges Manohar spent the majority of his time working with regulators to simplify, even though he would have preferred to spend that time with customers. These challenges extended globally because companies like Hitachi in Japan, for example, are hesitant to partner with Tandon Magnetics because the directors knew the Indian government took a long time to grant permission on such collaborations. Because of Manohar’s relationship with regulators, he secured permission in 45 days. Like Manohar, you may prefer to spend that time with clients, but developing relationships with regulators will pay off in the long run.
- Assemble a dedicated compliance team. Engage a certified accountant, corporate secretary, and legal counsel to help you assess and address compliance vulnerabilities, formulate a compliance plan, and document key compliance information such as written policies, communication with regulators and even case files.
- Look beyond financial and legal compliance. Human resources, payroll and IT are just as important as legal and financial compliance for growing startups.
- Develop a customized compliance plan. Your compliance program need not be expensive but should be tailored to the needs of your business. You can roll out the program over time as long as the program clearly communicates expectations and potential vulnerabilities.
- Foster a compliance culture. Put the right internal team in place to execute your compliance program so that it informs and ensures daily work and decisions. Founders who take the time to understand the marketplace, business culture, and regulatory environment wherever they do business positions their company to deal effectively with growth and maintain a competitive edge
If you’re a startup founder looking for resources to help you succeed, Tandon Group may be able to help. We’ve provided numerous startups with business advice and funding support for more than 40 years. Contact us today and learn more about how we can support you.