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Overview

MetricStream solutions help Retail, Consumer product goods organizations to take a collaborative and consistent approach to Legal and Corporate Compliance, maintain regulatory requirements and guidelines in a structured manner, and streamline compliance processes so that all departments can enforce and track them easily. The solution facilitates a federated approach which allows compliance and legal teams to effectively manage their individual responsibilities while simultaneously exchanging compliance information and rolling it up to be viewed by the management and board. This enterprise-wide collaboration is extremely important in proactively preventing unethical behavior and misconduct.

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Retail and consumer organizations, as well as brand-led companies often manage hundreds, if not thousands of store outlets, employees, franchise operations, and sourcing operations in multiple countries worldwide. They also have to handle numerous third parties, including agents, vendors, consultants, sub-contractors, lawyers, accountants, and clients.

Across this complex internal and external ecosystem, organizations are compelled  to monitor compliance with a multitude of corporate requirements such as the Foreign Corrupt Practices Act (FCPA), Anti-money Laundering (AML) / anti-corruption laws, insider trading rules, labor laws, and data privacy and security regulations. These requirements span various organizational functions areas such as Merchandising, Retail / Store Operations, Supply Chain Management and Distribution, HR, Marketing and Advertising, Properties, Real Estate, and Procurement.

To manage these corporate mandates, most organizations have a corporate compliance department headed by the Chief Compliance and Ethics Officer (CECO). More often than not, this team needs to collaborate closely with the legal team and General Counsel for subject matter expertise and back-up support on compliance. After all, many corporate compliance requirements have a legal angle where non-compliance could result in expensive law suits and settlements.

In many cases, the responsibilities of the corporate compliance and legal teams are two-fold --directly manage compliance with corporate mandates, and indirectly oversee compliance with regulations around fraud, product safety, environmental sustainability, and vendor governance. This kind of oversight is becoming increasingly important in light of the fact that dynamic corporate environments and stiff competition are forcing organizations to take a greater number of risks. In this pursuit, business leaders face the danger of losing sight of their corporate compliance and ethics goals, and crossing lines that shouldn’t be crossed.

A robust corporate compliance program helps prevent this scenario by ensuring that operations are ethical, that sales are not fraudulent, that conflicts of interest are avoided, and that confidential information entrusted to organizations by customers, is protected.

A collaborative and consistent approach is particularly important in retaining one’s focus on corporate compliance and ethics. Such an approach helps organizations maintain regulatory requirements and guidelines in a structured manner, and streamline compliance processes so that HR and other departments can enforce and track them easily. Federated corporate compliance management is equally important, as it allows compliance and legal teams to effectively manage their individual responsibilities while simultaneously exchanging compliance information and rolling it up to be viewed by the management and board. This enterprise-wide collaboration is extremely important in proactively preventing unethical behavior and misconduct.

Key Components of Effective Corporate Compliance Management

Educating and training staff members on their role in compliance management: Many regulations enforce certain restrictions concerning employee conduct. For example, AML requirements and FCPA list out a number of anti-bribery stipulations for employees dealing with suppliers, government clients, and stakeholders. If staff members are not aware of these restrictions, they may cause violations out of ignorance. Therefore, all relevant compliance standards should be communicated effectively to employees, as well as directors, executives, managers, agents, vendors, and other third parties, through comprehensive training programs. Each program must be designed taking into account differences across departments, regulations, geographies, cultures, and languages.  The effectiveness of the training program should also be evaluated through a closed-loop feedback mechanism.

Facilitating inter-departmental communication: Organizations must break functional and business silos, and promote communication around compliance matters across various departments and business units. This allows employees to understand the organization’s compliance efforts, the reasons behind them, and their place and role in the larger picture. This communication also extends to compliance reporting.  The compliance teams must report periodically to the management and board about the effectiveness of the compliance program.

Establishing consistent policies and procedures: There must be clearly defined and uniform policies, standards, and procedures to prevent and detect criminal conduct. If staff members receive multiple versions of similar policies from different sources such as HR, compliance officers, supervisors, or group heads, they are likely to get confused about the final goal. Another point to keep in mind is that as laws and regulations change, internal policies must be updated accordingly, and made available in a uniform manner to the concerned stakeholders. Ideally, all policies should be mapped to regulatory and other compliance requirements and areas so that if a policy change occurs, it can be seamlessly reflected in the compliance program.

Conducting regular risk assessments: Organizations need to consistently assess and mitigate corporate compliance risks around fraud, corruption, data privacy and security, product safety, insider trading, anti-trust, and vendor compliance. Both inherent and residual risks should be evaluated. The key is to measure, manage, and capitalize on risk with agility, and maintain a healthy attitude and aptitude for risk management.

Practicing continuous control monitoring and testing: Corporate compliance controls need continuous monitoring and testing to ensure their efficiency and accuracy in preventing fraudulent or unethical practices, detecting negligence, and identifying non-compliance with policies and regulations. When a control is found to be ineffective, the compliance team needs to act fast, and replace it with a more relevant and appropriate control procedure. Periodic risk-based audits also need to be conducted to evaluate the effectiveness of the compliance program. Effective and confidential whistle-blower systems are equally important in enabling employees and agents to report misconduct or unethical behavior without fear of retaliation.

Implementing due diligence programsMany times, companies run the initial risk assessments and checks on third parties. But post that, third-party due diligence processes are often neglected due to cost pressures. Conducting audits and assessments, and preparing reports takes substantial manpower, time, effort, and resources since in most companies, these activities are done manually using spreadsheets or paper-based processes.

Managing violations and incidentsIf regulatory violations take place, the staff should not be caught unaware. All departments must know their role in managing violations, as well as the processes that need to be followed, and the implications of their actions and decisions. Organizations need to be equipped to handle these process requirements, and have a robust and centralized system in place to conduct the resulting investigations. Steps should also be taken to prevent further issues or misconduct by, for instance, modifying company policies or audit procedures.

Managing the legal aspect of operationsCorporate operations involve a multitude of issues that have a legal angle. Implementing the required measures for employee health and safety, ensuring that the company follows a corporate code of conduct, stipulating that suppliers, vendors, partners, and third parties comply with required regulations - these are some of the areas which, if not managed properly, can have serious legal implications on the organization’s interests. Failing to protect the brand and intellectual property of the organization, ignoring certain regulations or codes of conduct while conducting sales and marketing activities, working in silos where different departments are not collaborating in achieving legal goals - these are additional scenarios where the legal team needs to put in extra effort to achieve its objectives.

The MetricStream Solution for Legal and Corporate Compliance

The prerequisites of a successful corporate compliance program are continuous control monitoring, tracking of multiple compliance processes, and creation of compliance awareness among all employees. MetricStream provides a comprehensive framework to help retail and consumer organizations streamline, automate, and monitor important aspects of corporate compliance while combining best-in-class technology with relevant regulatory content. Built on the industry leading MetricStream Governance, Risk, and Compliance (GRC) platform, the solution enables efficient management of the corporate compliance program at multiple levels.

Using the solution, the CECO can effectively set the right tone from the top of the organization, and enable it to percolate to all levels, thereby creating a culture of compliance across day-to-day operations. The solution also enables organizations to approach corporate compliance management in a holistic manner, encompassing all aspects to strengthen corporate integrity.

Below, in greater detail, are the primary capabilities of the solution:

Corporate Ethics and Compliance Management
Preventing and remediating corporate compliance and ethics violations are two of the key challenges facing organizations today. The MetricStream solution enables organizations to achieve a high level of efficiency, agility, accountability, transparency, and sustainability in their corporate compliance and ethics program. The solution also helps in developing and implementing policies that map to regulatory requirements and rules, streamlining the training process, documenting and assessing risks related to corporate compliance, enabling continuous control monitoring and testing, tracking non-compliance, and putting in place an immediate corrective action plan.

Policy Management
The MetricStream solution offers an efficient way of creating, publishing, and distributing policies as well as performing policy awareness assessments for continued assurance. It also allows the creation of surveys, certifications, and questionnaires that serve as effective tools to discover gaps in the compliance and ethics program. Corrective and preventive measures --such as designing training programs, and updating policies and procedures -- can be triggered automatically, based on the gaps identified.

Policy exceptions can also be tracked through a comprehensive issue management mechanism. A centralized repository is maintained for the latest versions of documents, policies, procedures, regulations, and standards prescribed by various regulatory bodies. The solution also helps in embedding consistent and relevant policies and documents into the compliance and ethics program which contributes to increased employee awareness.

Training Management
The MetricStream solution enables effective management of the compliance training process by maintaining course offerings and descriptions for easy review by employees and managers, helping schedule training sessions, providing feedback on instructors and course material effectiveness, maintaining training records, and conducting gap analyses to ensure complete compliance.

A powerful analytics and reporting capability with graphical dashboards helps monitor the effectiveness of each compliance training program, and provides managers with complete real-time visibility into the training management system. At any given time, managers can view the company’s overall compliance awareness level.

The scope of training offered by the solution includes a basic level of compliance awareness for all employees, third-party training for suppliers and vendors, and specialized and in-depth training for employees at risk.

Risk Management
Regulatory non-compliance, unethical dealings, and fraudulent practices can lead to financial risks in the form of penalties, lowered stock prices, the risk of lost business opportunities, and the reputation risks. MetricStream provides an integrated and flexible risk management framework for documenting and assessing risks related to corporate compliance, defining and assessing controls, identifying issues, and implementing recommendations and remediation plans. The solution includes tools such as configurable risk calculators and risk heat maps for risk analysis and monitoring.

Risk assessments are supported based on typical scenarios and risk factors specific to the organization. The qualitative and quantitative impact of each risk can be evaluated, and controls accordingly implemented. The performance of these controls can also be closely monitored and assessed to ensure their effectiveness in mitigating risk.

Controls Management
Preventive controls can be established in accordance with the risk profile of the company. These controls need to be reflected in the company’s operations. MetricStream’s integrated solution backed by detailed workflows enables organizations to define, assess, and re-align preventive controls. The solution also supports tracking of controls to ensure that the processes are followed as required, and that evidence is submitted to the relevant personnel to confirm the effectiveness of the controls.

Due Diligence
The MetricStream solution provides a flexible system for third-party due diligence. It unifies and consolidates all third parties in a centralized framework, thus providing complete visibility into third-party risks and compliance, increasing collaboration between companies and their third-parties, and minimizing redundancies. The solution also streamlines third-party due diligence processes – right from third-party onboarding and information management, to code of conduct training, to risk management, control monitoring, and due diligence reporting. Advanced risk analytics help transform third-party data into meaningful insights.

Case Management 
The MetricStream solution supports the identification of issues such as fraudulent activities and unethical practices through integration with hotline/whistle-blowing systems. The solution also enables organizations to establish and follow consistent procedures for capturing fraudulent and unethical issues, managing tasks, and reporting issue status. It supports the evaluation of compliance issues, as well as case investigation and tracking, and initiates an elaborate remediation or corrective action process.

Advanced analytics, tracking, and reporting capabilities with graphical dashboards give managers complete real-time visibility into the corporate compliance environment, and provide critical information for reducing the risk of non-compliance.

Continuous Evaluation and Audit Management
MetricStream provides a comprehensive audit system designed to help companies manage a wide range of compliance audit-related activities, data, and processes, using a risk-based approach. The solution provides the flexibility to support all types of compliance audits including internal audits, supplier audits, and operational audits. It also provides end-to-end functionalities for managing the complete audit lifecycle, comprising audit planning and scheduling, development of standard audit plans and checklists, data collection, development of audit reports and recommendations, review of audit recommendations by audit entities, management and implementation of audit recommendations, and remediation.

Solutions for the Retail and Consumer Goods Industry
Retailers face a multitude of challenges -- a volatile economic scenario, data security breaches, complexities and risks in global sourcing and trade, and changing regulations and legal requirements for supply chain and multi-channel operations. Adding to this is a growing demand for environmentally sustainable commodities that has compelled retailers to integrate sustainability practices into their core operations.

When risks, audits, and compliance issues are managed in silos, risk mitigation becomes cumbersome. What organizations need is a centralized GRC solution that will enable them to comply with the ever-increasing number of regulatory requirements, ensure that risks are identified and mitigated across the enterprise, and, protect their corporate reputation and brand value. Organizations also need to adopt a proactive approach to quality and audit programs in order to manage inspections effectively, identify and mitigate risks across the supply chain before they get out of hand, and enforce suitable social compliance policies.

MetricStream Retail Solutions

MetricStream’s holistic GRC solutions help retailers:

  • Automate and optimize GRC programs and initiatives within the organization
  • Integrate governance and compliance programs with core retail operations like finance, merchandising, supply chain management, vendor risk management, and environmental management and sourcing
  • Streamline audit governance programs for internal and external audits, warehouse and store audits, and environmental audits

Capabilities of the Solutions

Corporate Compliance Management
MetricStream Corporate Compliance Management Solution enables retailers to enhance compliance with mandates such as FCPA, AML / anti-corruption laws, insider trading rules, and labor laws. It also helps them efficiently manage compliance with HR policies and procedures, training and certification requirements, privacy policies, diversity affairs, legal requirements, risk management, audit management, and IT security mandates.

Quality Management
The Consumer Protection Act (CPA) protects the rights of the consumer by ensuring the safety and quality of products. MetricStream Quality Management Solution optimizes quality management across the whole cycle of retail operations. The solution protects, maintains, and improves the quality of operations by making processes visible and measurable. It also provides evidence of compliance with policies and guidelines (due diligence).

Supply Chain Risk Management
MetricStream Supply Chain Governance Solution automates supplier management processes including supplier information management. It also helps retailers effectively manage their supplier quality and audit programs, supplier risk, and supplier compliance and performance programs. Through the solution’s structured and streamlined approach, retailers can efficiently identify, mitigate, and manage supplier risks.

Audit Management
Besides managing internal audits, retailers also need to efficiently manage store audits, warehouse audits, supply chain audits, quality audits, compliance audits, environmental audits, etc. MetricStream Audit Management Solution helps retailers manage the entire audit lifecycle including audit planning and scheduling, audit execution, audit reviewing, and audit issue management. Audit plans are tracked, and the results are linked with compliance risks, performance metrics, and scorecards that provide complete visibility into the audit process and risks.

Social Compliance
The changing pace of global markets and global sourcing requirements has brought in a number of social compliance policies at every step of the retail business cycle. These policies are based on laws and regulations, women’s rights, wages and benefits for employees, working hours for employees, child labor, discrimination, environmental requirements, communication and record keeping, and, implementation of disciplinary practices. The policies need to be enforced and monitored both within the organization as well as with suppliers spread across the world.

MetricStream Social Compliance Management Solution helps organizations create, organize, and review policies, map policies to regulations, and communicate the policies to suppliers and employers. A powerful analytics and reporting capability along with illustrative dashboards give retailers complete visibility into the system to support a culture of governance.

Inspection Management
Retailers need to constantly conduct external and internal inspections -- either scheduled or unscheduled -- to check on various aspects including customer experience, customer-friendliness of stores, the cleanliness and layout of the store, stock presentation, pricing accuracy, employee experience, and safety and health-related aspects both internally as well as at supplier facilities. MetricStream Inspection and Audit Management Solution helps co-ordinate, collaborate, and provide visibility into all inspection and remediation activities. The solution manages all inspections in a centralized and collaborative manner by assigning tasks, tracking statuses, and prompting remediation activities.

MetricStream’s flexible and robust GRC solutions help harmonize all risks, controls, control assessments, processes, policies, regulations, and other GRC elements in centralized libraries. It also delivers a superior user experience through intuitive navigation tools, visualization of GRC data, and simplified information sharing and collaboration capabilities.

MetricStream’s Value Proposition

  • Provides a common compliance structure and a single framework to manage a diverse range of corporate compliance and regulatory requirements
  • Enables an integrated, federated, and collaborative approach to corporate compliance across the enterprise
  • Enables effective management of policies, procedures, risks, internal controls, audits, issues and corrective action, integrating the different components together
  • Maps corporate policies to regulatory requirements in a one-to-one and one-to-many manner, thus strengthening the agility of the compliance program
  • Streamlines compliance training at various levels in the organization, and enables a closed-loop process for feedback
  • Provides a centralized view of the organization’s compliance and ethics program, and delivers real-time risk and compliance intelligence for informed strategic decision-making
  • Includes a built-in ability to track changes in the regulatory landscape by integrating regulatory alerts and updates from reliable external sources
  • Can be configured to adapt to changing business processes and requirements, without deviating focus from business goals
  • Allows the top management to set the tone of regulatory accountability across the organization, and facilitate a culture of corporate compliance
  • Is scalable and can be easily aligned with the organizational growth path
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