Regulatory Compliance & Risk Management Flashcards

What is the purpose of regulatory compliance?

Answer: Follow laws and standards

Regulatory compliance ensures that businesses operate legally and ethically by adhering to all relevant laws, regulations, and industry standards. This adherence protects the business from legal penalties, maintains its reputation, and demonstrates a commitment to responsible operations.

Which federal agency enforces workplace safety regulations?

Answer: OSHA

The Occupational Safety and Health Administration (OSHA) is a federal agency specifically tasked with ensuring safe and healthful working conditions for employees. It sets and enforces standards, and provides training, outreach, education, and assistance to employers and workers.

What does risk management involve?

Answer: Identifying and mitigating risks

Risk management is the systematic process of identifying potential threats and vulnerabilities that could negatively impact a business. Once identified, strategies are developed and implemented to reduce the likelihood or impact of these risks, safeguarding the business's assets and operations.

Which document helps ensure employees understand workplace policies?

Answer: Employee handbook

An employee handbook is a crucial document that outlines a company's policies, procedures, and expectations for its employees. It serves as a comprehensive guide, ensuring consistency, clarity, and legal compliance regarding workplace rules, benefits, and conduct.

Which insurance protects businesses from lawsuits?

Answer: Liability insurance

Liability insurance protects businesses from financial losses resulting from claims of negligence, injury, or property damage caused to third parties. It covers legal defense costs and settlement payments, safeguarding the business from potentially devastating lawsuits.

Why is cybersecurity important in risk management?

Answer: Protects data and customer information

Cybersecurity is a critical component of risk management because it safeguards a business's digital assets, including sensitive customer data, financial records, and intellectual property, from cyber threats. Protecting this information is essential to prevent data breaches, maintain customer trust, and avoid significant financial and reputational damage.

Which act protects consumer privacy?

Answer: GDPR

The General Data Protection Regulation (GDPR) is a comprehensive data privacy law enacted by the European Union, which significantly impacts how businesses handle personal data. It grants individuals greater control over their personal information and imposes strict requirements on organizations regarding data collection, storage, and processing, regardless of where the business is located if they handle EU citizens' data.

What is a business continuity plan?

Answer: Emergency operations plan

A business continuity plan (BCP) is an essential emergency operations plan that outlines how a business will continue to function during and after a disruptive event, such as a natural disaster, cyberattack, or power outage. Its purpose is to minimize downtime, protect critical assets, and ensure the rapid recovery of essential business operations.

Why are audits important for regulatory compliance?

Answer: Verify compliance and improve controls

Audits are crucial for regulatory compliance as they systematically review a business's operations, financial records, and internal controls to ensure adherence to laws and regulations. They help identify any gaps or non-compliance issues, allowing the business to implement corrective actions and strengthen its control environment, thereby reducing risks and penalties.