Regulatory Risk Plan
It is essential that businesses have a strategic plan in place to minimize or eliminate regulatory risk that may exist throughout the course of business. Knowing the laws and regulations that govern the business, whether public or private, is first step to preventing violations that may be costly and detrimental to the company. In order to manage such risk it is imperative to take a proactive approach and establish a plan that will identify and manage these risks through preventive, detective, and corrective measures.
It is detrimental that the business identifies the critical risks and potential torts, and quantifies their potential impact. The three basic elements in a tort are wrong, harm, and relationship between the injurer wrong and the harm to the victim. The first step in preventive management is to establish an effective communication plan. The plan should ensure compliance and issues reporting especially between the entire corporation and all stakeholder organization or entities involved. The company is ultimately responsible to stay up-to-date and compliant with past and present federal regulations and keeping all employees, internal stakeholders and external stakeholders informed. A regular status or stakeholder report is one way to ensure that this information is transmitted to all parties. Preventive management also requires the company to conduct routine SWOT analysis and also become knowledgeable of its competitors. This type of analysis will allow the company to clearly identify the risks that may occur in every transaction, therefore allowing business and legal techniques that will eliminate or reduce those risks. Obtaining insurance is another proactive approach to handling such risks.
Another form of managing such liabilities is being able to detect them should and when they occur to resolve them as quickly as possible. Some common business torts include; commercial defamation, interference with...