Compliance programs are becoming increasingly important in Australia. They can ensure that management and staff are aware of the organisation’s obligations under legislation towards clients and other organisations.
It is not only regulators, such as the Australian Competition and Consumer Commission (ACCC), that are promoting their use. Courts and corporations are also acknowledging the value of compliance programs and strategies. Legislators have even included comprehensive compliance obligations in laws such as the Federal Managed Investments Act 1998.
A common perception is that compliance is only done to keep the regulators happy. It has frequently been seen as a burden, rather than as an opportunity to improve an organisation’s performance or its relationship with clients and stakeholders.
A compliance program is designed to reduce the risk of breaking the law as well as handling complaints and learning from them. There are three good reasons for a program: it is good corporate governance: it minimises the risk of litigation; and, in the event of litigation, an effective compliance program can significantly reduce court imposed penalties.
Potential liability for damages for contraventions of the Trade Practices Act are another strong incentive for having a good compliance system in place. Financial penalties for anti competitive conduct are substantial and managers and directors can be held personally liable. A good compliance program can reduce the risk of breaking the law in the first place.
Establishing a compliance system should not be a one off activity. An ongoing commitment is required through training, giving staff specific responsibilities and reviewing your organisation’s progress from time to time.
Dispute resolution procedures are another vital tool. Disputes between organisations and their suppliers or clients are a fact of life and you can avoid stress and save time and money by being calm.
Raise the matter quickly with the other party, don’t let things fester. Make it clear you want the matter resolved but if progress is difficult you can seek a meeting under the auspices of a mediation service. Mediation is a quick alternative to court action and can leave a relationship intact.
Prevention is really better than cure and a major method of prevention is to recognise each other’s concerns about things, such as reliability, meeting commitments, delivering on time and competitive pricing. And, importantly, give every party to a dispute a fair hearing.
The theme of the ACCC’s 21 May Competing Fairly Forum is Prevention is Better than Cure. Compliance issues will also be discussed. For details see the forum website at forums.accc.gov.au or call the ACCC Infocentre on 1300 302 502.
The publication, Benchmarks for Dispute Avoidance and Resolution, is available free from the ACCC website www.accc.gov.au
* Copy supplied by ACCC
