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Redefining the return on investment of compliance

Kudzai Chaka (kudzaic@kccompliance.co.za) is the founder and CEO of KC Compliance in Johannesburg, South Africa.

Compliance is typically described as a cost center, meaning that it is not a revenue-generating part of the business and that investing in it means the business is spending money, not making it. Some might argue that if businesses were not mandated by regulators to have a compliance function, a lot of practitioners would lose their jobs due to a common misconception by some companies that the costs of a compliance function outweigh the benefits. Although compliance does not generate revenue in the traditional sense, its immense value should be highlighted and defined in monetary terms to ensure that our stakeholders, who primarily think in terms of dollars and cents, appreciate our contribution.

To date we have not been particularly successful in articulating our value proposition in a language that resonates with businesses, but it is our responsibility to make the case for continued investment in compliance. In any performance appraisal process, it is the role of the party being appraised to highlight where they have excelled and how they have added value in the role. By redefining how we measure our performance and reporting on it to our stakeholders, we can better demonstrate that a strong and well-supported compliance function can have a positive impact on efficiency and profitability and make a tangible contribution to the bottom line.

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