There Has Never Been A Better Time To Outsource Your Compliance
Most people think of compliance as the typical year end and corporate filing cycles, however globalisation has changed the corporate landscape, and my experiences working for both a global investment bank and for boutique corporate service providers has taught me that the one thing you can be sure of is that nothing remains constant, and that the greater part of the work is keeping pace with regulatory changes which can happen swiftly across multiple jurisdictions. The impacts of understanding and complying with these changes can absorb a lot of the capacity of any internal compliance team at best, and at worst it can result in missed filings, regulatory penalties, reputational damage and harsh lessons learned.
Challenges for Directors
Given the potential consequences, complying with legislation locally and overseas is something that Directors should always consider with the utmost importance, particularly as they are duty bound to exercise care, skill and diligence under the Companies Acts legislation in the UK & Ireland; a duty which encapsulates maintaining a compliant company. This is not always at the forefront of the mind for those same busy individuals; when we factor in the current challenges that Directors are facing due to the pandemic, those same individuals are having to make some very difficult decisions about financing and staffing in the short to medium to ensure their business survives in the months to come, which has to be their main priority. While company survival is, and has to be, the primary concern of Directors and senior management, it cannot be done at the expedience of compliance and good governance.
Records have never been more important
The last few months have provided significant challenges for companies and their Directors and unfortunately many companies will become insolvent. Tough decisions have been made, in some cases with limited time and information to hand, and it is important that those decisions are documented fully as to show how the thought process arrived at a certain outcome. In the aftermath the lens will be firmly set on the decisions leading up to insolvency and whether Directors were abiding by their statutory duties; this is where proper minutes of Board meetings and resolutions will play a large part in the analysis, and in this respect it is imperative that appropriate records have been maintained. Engaging specialised compliance professionals to maintain this aspect of corporate record keeping will ensure that they are documented and maintained to the highest standards.
Time to outsource?
Notwithstanding the challenges of 2020 there are many reasons you should consider outsourcing your compliance and company secretarial function; having qualified and dedicated professionals navigate the somemes complex legislative landscape will mean that you continue to focus efforts on other key strategic business areas, safe in the knowledge that your outsourced provider will ensure that all aspects of the company’s compliance are maintained and they will keep you fully abreast of any developments which may impact the company. Outsourcing can result in significant cost savings; your business needs may not warrant a full-time resource, or time demand may be cyclical with certain periods, so outsourcing will mean you pay for resources as needed. Other benefits include highly-specialised advice on technical queries, continuity of service, and ensuring that all changes necessitating filings with statutory bodies follow due process and company decisions are appropriately documented by way of minutes and resolutions.
To discuss outsourcing your compliance function or for specialist support contact us at email@example.com to see how we can best fit your needs.
Article written by our Associate Director and company secretary Darren Leonard. Darren has a wealth of company secretarial experience locally and internationally, having worked with corporate services providers and a global investment bank. He is also a Fellow of the Chartered Governance Institute.