A comprehensive guide to regulatory change management

The current regulatory landscape is constantly evolving with modern businesses subject to a myriad of regulatory challenges at local, national, and international levels – regardless of their industry. Regulatory change occurs at a rapid pace driven by technological advancements, customer expectations, legal requirements, emerging risks, and geopolitical shifts – making the act of regulatory compliance a daunting task.

A regulatory change management process ensures organizations adapt to and comply with laws, legislation, and regulations relevant to their operations. Read this blog to delve into what regulatory change management is and understand how organizations can establish a process to get full visibility of upcoming changes and implement them in a timely manner to maintain compliance. We’ll explain how organizations can stay ahead of regulatory change and explore the key challenges faced when relying on manual regulatory change management processes.  The blog also shares insights on how to manage regulatory change with software.

What is Regulatory Change Management?

Regulatory Change Management refers to how organizations anticipate, assess, adapt to, and comply with laws, rules, and regulatory requirements that affect their industry and business operations. This includes staying updated on evolving regulatory changes and effectively adapting internal processes, policies, procedures, and systems to ensure compliance with the new requirements.

The objective of a regulatory change management framework is to help organizations create efficient, repeatable processes that help them understand how new requirements affect their operations so they can modify their practices accordingly. Organizations usually start out by building an ‘obligations register’ of applicable regulations, standards, and legislation that are applicable to their business. They must then map each regulation to the relevant business processes, policies and procedures – this makes it easy to understand the potential impact of what needs to be altered should the regulation change in the future.

The next crucial aspect of regulatory change management is to keep updated on when regulations are likely to change, expire, or undergo revisions. This might involve monitoring government & regulatory websites, and interacting with industry associations, newsletters, and professional networks. Some companies choose to work with legal and compliance advisors or subscribe to regulatory updates via third party regulatory intelligence providers.

Once a change is identified, the business must formalize an escalation and change management process workflow to notify the relevant stakeholders of the change and fully document how and when the change was implemented. Any regulatory change will likely impact a number of business processes, departments, policies, and procedures – which is why mapping regulations to business processes, policies, and processes upfront is essential to speed up the change process. Each aspect of how and when the change was made must be fully documented for compliance & audit purposes.

Why is Regulatory Change Management Important?

A robust and well documented regulatory change management process is key to ensuring businesses successfully navigate regulatory changes whilst maintaining compliance – preserving their reputation and safeguarding the company from possible legal implications, fines, and penalties.

Regulations change swiftly – imposing new requirements and compliance obligations for companies worldwide. Failure to comply with regulatory changes can affect reputation and cause a business to lose vital contracts. Regulatory change management is not just a regulatory necessity, it is a strategic imperative that influences an organization’s ability to operate in accordance with legal and regulatory requirements. It involves an organized approach to recognizing, evaluating, and executing regulatory updates within the business.

Regulatory compliance is essential to safeguard the economy and supports businesses to preserve public trust. Given the potential consequences of missed regulatory updates, businesses regardless of industry are obliged to pay close attention to any applicable regulatory changes. With that in mind, it is vital to create a compliance program that holds up under the magnifying glass and provides complete transparency about how and when regulatory changes were communicated and implemented. 

How can Organizations get Visibility of Upcoming Regulatory Changes?

In highly regulated industries like pharmaceutical, healthcare, gambling, financial services, and banking, their greatest compliance challenge is often keeping up with rapidly evolving regulatory changes.

Compliance officers must stay on top of the constant flow of regulatory changes impacting the business by gathering and analyzing new information from regulators and deciding the best course of action for the company.   For those using outdated manual processes, this can involve manually checking regulators, industry associations, and news sites for updates and deciphering changes in technical regulatory documents – which is very time-consuming & costly and can lead to missing crucial changes due to human error and lack of oversight.

However, thanks to modern technology, manual regulatory monitoring is being consigned to the past. Firms can now subscribe to specialized regulatory content providers such as LexisNexis  to receive live updates when regulations change – that feed straight into their compliance program.

These subscription packages provide digestible information in easy-to-understand modules, so businesses can subscribe to the content that’s relevant to them.  These specialized content providers also offer industry-specific content packages relating to highly regulated industries like banking, insurance, healthcare, and gambling & gaming as well as some country and regional-specific content packages.

As part of their service Lexis Nexis for example offers real-time alerts based on a business’s selected modules to ensure that when legislation changes companies know how to respond, understand why action must be taken, and what the consequences are of non-compliance. These expert-reviewed, digestible information breakdowns are provided in simplistic language with clear actions, so compliance teams can easily understand the impact of the change in relation to their business. This time-critical information not only keeps businesses up to date with the latest changes that are occurring in the regulatory landscape; it also links to guidance about how to comply with the obligations.

An automated regulatory compliance solution like the Camms platform seamlessly integrates with your preferred regulatory content provider – enabling organizations to fully automate their regulatory compliance program in one centralized platform. Communication between the two solutions is established through API integrations. Regulatory change notifications feed directly into the Camms platform initiating automated workflows to implement the change – allowing businesses to effectively zero in on upcoming regulatory changes that will impact the business and manage them proactively.

What are the Problems with Manual Regulatory Change Management Processes?

Historically, regulatory change management has very much been a manual effort – resulting in a lack of accountability and follow-up. In the absence of a regulatory compliance system; a dedicated employee or compliance team – typically with legal knowledge – would spend their time (often hundreds of hours) trailing the internet and monitoring RSS feeds to look for changes, and manually instigating the changes through numerous emails, phone calls, and spreadsheet documentation. It’s a slow, laborious process, prone to human error, it doesn’t fully document the process and is not the best use of highly skilled employees’ time.

Here are some of the key challenges presented by a manual regulatory change management process:

Lack of an Audit Trail: Manual processes are prone to failure because there is no audit trail detailing who reviewed what, the action that was decided upon, and when it was implemented.

No Accountability: Deprived of an audit trail, there is no accountability for regulatory change. The organization subsequently lacks visibility of who is responsible for changes in each regulatory area and the compliance status.

Reduced Business Agility: A regulatory strategy that relies on manual processes deprives the organization of the agility to adapt effectively to change quickly – resulting in regulatory non-compliance and lost business.

Restricts a Holistic View of Regulatory Change: A reactive, siloed approach to regulatory change management leaves the organization unable to foresee upcoming changes, inhibiting planning, budget optimization, and process transparency.

Files and Documents out of Sync: Manual processes require organizations to track and control all versions of emails and documents, which quickly become out of sync and irrelevant due to a lack of integration and automation – causing the accuracy of the information to be questioned.

Limited Reporting: Manual processes inhibit compliance reporting outputs by lacking the functionality to facilitate vital reporting functions, such as the number of regulatory updates pending, who they are assigned to, and whether they are on schedule – leaving business leaders unsure if they are compliant.

Wasted Resources and Spending: Manual regulatory monitoring wastes resources and exposes hidden costs due to increased admin and the need for legal specialists. Rather than using GRC software to create a holistic view of regulatory change, changes are managed independently without measure – and cannot be integrated into a defined business process.

The more effective and efficient approach to regulatory change is an automated one in which technology carries out the labor intensive manual work and specialized legal skills, and leaves highly trained compliance individuals to do the analysis, critical thinking, and high-value work.

How can software support with Regulatory Change Management?

Having a robust regulatory change management program that leverages regulatory compliance software can help organizations successfully scan the regulatory horizon and ensure compliance with relevant regulations and manage compliance risks in one holistic solution.

To achieve a truly comprehensive regulatory change management program, businesses should look for GRC software with integrated regulatory feeds from third party intelligence providers – to provide them with the clarity they need when navigating the dynamic regulatory landscape. By accessing a broad spectrum of up-to-date regulatory content and regulatory intelligence feeds within their regulatory compliance solution, businesses open the door to a rich repository of information – ensuring they keep pace with changing rules and regulations. Once the software is embedded, it creates a comprehensive regulatory change program complete with an ‘obligations register’ – with a whole host of benefits including:

• A clear view of which regulations link to which internal policies and procedures, allowing a full impact analysis to be conducted.
• Visibility of individual accountability and responsibility for corrective actions.
• Clear compliance oversight for management – fostering an understanding of the business’s regulatory position and potential risks.
• The risk of non-compliance is mitigated by automated regulatory updates that send alerts, ensuring changes can be actioned using best-practice regulatory change management workflows.
• Technical regulatory content is broken down into easily digestible information with clear actions – eliminating costly legal fees.
• Automatic reporting on compliance status saves time and resources – providing enriched data analysis that reinforces decision-making.
• A clear time stamped audit trail of change actions – to simplify reporting to auditors and regulators.
• Structured processes & workflows to refine the regulatory change process and streamline the implementation and documentation of changes.
• A solution that easily integrates with a business’s existing systems and regulatory content provider via APIs facilitates the management of risk and compliance processes in one dependable solution.

Navigate Regulatory Change Management with Camms

Camms software provides a comprehensive approach to regulatory change management. Our intuitive cloud-based regulatory compliance tool leverages easy-to-understand regulatory compliance information via APIs, bringing it to life so you and your team can spend less time working out what has changed in the law, and more time doing something about it. By automating the regulatory change management process, Camms software has the power to:

• Conduct regulatory horizon scanning and notify you of relevant regulatory changes.
• Set up workflows to facilitate implementation of regulatory changes throughout your organization.
• Host a centralized ‘obligations register’ of regulatory compliance obligations, authority documents, procedures, and policies.
• Facilitate informed decisions and regulatory compliance tracking based on real-time regulatory compliance updates.
• Link regulations to organizational risks, policies, procedures and incidents – to fully understand the impact of each regulatory change.
• Align your regulatory compliance process with industry best practice with automated workflows, live change notifications, automated review processes, and detailed action plans.
• Generate sophisticated regulatory compliance reporting and audit trails showing how and when changes were made at the click of a button.
• Provide compliance professionals and directors with access to a centralized dashboard for improved analysis of compliance issues and outstanding actions.

Proactively managing regulatory change is vital for any business. Staying informed through live regulatory updates and promoting a culture of compliance are all essential steps to navigate the dynamic regulatory landscape effectively.

However, by utilizing software for regulatory compliance, your compliance team can truly begin to elevate their approach to staying compliant in a highly regulated and competitive business landscape. Regulatory compliance monitoring technology not only allows you to make a significant difference in your compliance efforts, but organizations can also successfully ensure legal adherence while safeguarding their reputation, enhancing client satisfaction, and helping the company stay ahead in the ever-evolving world of business regulations.

Camms helps organizations both large and small go beyond meeting regulatory requirements to generate real value from their regulatory change program.  If you are curious to learn more about how Camms stands out among other compliance software vendors and can help you simplify and automate your regulatory change process with GRC technology, simply request a demo today!