Why Is Compliance So Hard?
Before that question can be answered, there is another question that needs to be asked first.
What is digital compliance?
According to XI Digital, digital compliance is defined as
Digital compliance refers to the various legal regulations surrounding online business operations, and they are numerous. Compliance regulations can be provincial or state-regulated, federally regulated, and in some cases, continentally regulated.
Now that this has been defined, think about the complexities involved with adhering to the compliance regulations. The realization of the intricacies of compliance can be a headache for the CFO.
$888 Million
That’s a big number. This amount represents the fine levied against Amazon by the Luxembourg data protection authority in July 2021. The behemoth company was accused of “processing personal data in violation of the EU’s General Data Protection Regulation, or GDPR.“
What’s the Risk of Doing Nothing?
Veritas conducted a survey and some of the results are grim, to say the least if no action is taken.
83%
say siloed data management is impacting compliance
95%
have long-term damage from inefficient data management.
58%
say complex data footprint limits the ability to use data
$7.9M
the average cost of a data breach in the United States
Let that sink in, and this emphasizes the urgency for CFOs to act — NOW.
Another important point to consider is this: “Underestimating strategic risk is one of the top causes of shareholder value destruction.“
Closing Thoughts
At the beginning of this post, the question was posed of “Why is compliance so hard?”
Yes, laws are complex, data security restrictions are tightening, but it’s not all “gloom and doom”. By being strategic with internal governance practices and strengthening security resilience through collaboration, the CFO is uniquely positioned to hold the reigns in the company’s direction.
Proactive digital compliance should shape the vision of finance. Analog thinking doesn’t work in our digital world.
