Industry Governance and Industry Compliance Issues

The regulatory burden on businesses grows more onerous every day: Sarbanes-Oxley, Payment Card Industry Data Security Standard (PCI/DSS), Statement on Auditing Standard – Service Organizations (SAS-70), California Security Breach Information Act (SB 1386). And this burden is not lessening, rather it is growing more complex and more expensive.

Companies have responded by allocating headcount and money to the problem and by quickly creating a host of distinct “point solutions” to meet compliance challenges. These solutions are proliferating throughout the organization – they can be found in the audit committee, finance, HR, sales, procurement, and IT. Entire compliance departments are even being organized around specific regulatory bodies, such as the SEC for Sarbanes-Oxley, or the FDA in response to the Health Insurance Portability and Accountability Act or the Gramm-Leach-Billley Act.

Governance imposes a major burden on core business functions as these functions attempt to satisfy all the compliance requests, coming from all the different point solutions, while trying to conduct daily business. And the demands and requests are growing.

Financial Services Companies are dealing with Sarbanes-Oxley, the USA Patriot Act, Bank Secrecy Acts, Basel II, GBLA, SEC Broker Dealer regulations, EU Directives, and Fair Lending all present a complex web of governance challenges that span the enterprise. “Even where chief risk or compliance officers exist at larger banks, the scope of their responsibility is often remarkably narrow, and many times just involving Fair Lending. Meanwhile SOX and the Patriot Act are divvied up between chief financial officers, chief risk officers, and general counsel,” said Michael Sisk, Bank Technology News.

Energy Companies face one of the most intensely regulated business environments that exist today. Regulators at the local, state, federal and international levels are continually adding and updating requirements. Penalties for companies who are not in compliance are severe. Compounding the matter is the dynamic nature of the energy business itself. There are broad swings in the normal business cycles, many mergers and acquisitions, and other factors that, when taken together, create a tough corporate governance environment. Consider the stream of energy regulations from the Federal Energy Regulatory Commission (FERC), the North American Electric Reliability Council (NERC), those from all the State Utilities Commissions, OSHA and the EPA.

Healthcare Organizations must address new and changing regulations and standards such as - HIPAA (Health Insurance Portability and Accountability Act) - Medicare - Stark (Physician self-referral law) - and JCAHO (Joint Commission on Accreditation of Healthcare Organizations.

All companies, across all industries, will benefit greatly from Polivec’s EGS.