SME & START-UP
SME (Small and medium-sized enterprises)
“Corruption is perceived as one of the major obstacles that small and medium-sized enterprises (SMEs) face in their business environments. They are usually the first to suffer in a marketplace where corruption exists and they have less power to avoid corruption and, as a result, their profit margins and survival are at stake when corruption takes hold. The high costs of corruption (time and money) are difficult for small firms to sustain. Since SMEs are regarded as the engine of growth in many economies and are hence crucial for the development of societies vulnerable to poverty, the effects of corruption can be devastating.”(*)
(*) “Corruption prevention to foster small and medium-sized enterprise development – VOLUME II” UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION (“UNIDO”) AND UNITED NATIONS OFFICE ON DRUGS AND CRIME (“UNODC”).
Compliance is a core component within all organizations regardless of their size.
SMEs frequently fail to develop an effective program as required under the Federal Sentencing Guidelines.
There are misconceptions that SMEs do not face the same compliance risks as larger organizations, and that to implement compliance programs the organization must spend a lot of money. These misconceptions are completely inaccurate.
Compliance programs are especially important at start-up companies because the best time to implement one is when you start a business. They are easier to implement upfront as there are no other systems in everyone’s mind which creates a culture of corporate compliance from the beginning.
A compliance program helps educate employees on laws and ethical business behavior. It also protects the company’s future as it helps mitigate potential risks, particularly ones the business is completely unaware of. It impresses clients, attracts reliable investors and third parties.
SME & Start-Up
There are simple and affordable means to implement compliance programs in SME and Start-up, including the combination of leadership commitment to do the right thing and to take effective management steps.
SME and Start-up can implement an effective compliance program with an inexpensive investment.
A compliance program allows SME and Start-up to centralize, prioritize, manage, and control risks effectively.
An effective compliance strategy ensures SME and Start-up are partnering with trustworthy third parties. Doing business with reliable third parties helps a company synchronize its business, legal, and compliance concerns.
Like large and global companies, SME and Start-up also need to ensure they are not putting their assets and their customers/clients at risk.
SME and Start-up pay a high price for a lack of compliance programs, ethics, and a failure to detect red flags.