top of page
  • Writer's pictureCristian Gherhes

Reactive versus Proactive Compliance: Why Prevention is Better than Cure

Proactive compliance

Our work life often revolves around the ping of a notification. Whether from Outlook, Teams, Slack, or another communication channel, we are in constant dialogue with our colleagues, customers, and vendors. We have seen the use of electronic communication in business evolve to the point where we cannot imagine working without it. It’s transformed the way we work, it’s efficient, and it’s convenient, but with all this great convenience also comes great responsibility – and potential liability from non-compliant communication. With the increasing use of these channels, there is a growing risk of legal and compliance breaches. To prevent such risks, businesses must go beyond traditional and reactive compliance measures and be more proactive in their approach.

So, what exactly is the difference between proactive and reactive compliance? Reactive compliance is when a company takes action after a breach has occurred. Reactive compliance measures usually involve monitoring and surveillance, investigations, audits, and legal fees, which can be costly, ineffective, and time-consuming. One key issue with reactive compliance is that it is often too late to prevent the breach from occurring, and the damage may have already been done. This often involves significant legal and financial consequences, as well as reputational damage. More than that, reactive compliance measures do not address the root cause of the breach, which is why we often see repeat violations. As for Legal and Risk & Compliance teams? They are left firefighting issues when things go wrong and all they can do is mitigate the negative consequences.

Proactive compliance, on the other hand, is when a company takes proactive measures to prevent a potential breach before it occurs. Proactive compliance offers several benefits. First, by addressing potential risks in advance, businesses can avoid costly fines, litigation, and reputational damage. Second, proactive compliance helps to build and promote a culture of compliance across the entire organisation. Employees are more likely to follow the rules and regulations when they see that their company is taking compliance seriously and this also benefits them directly. This can lead to improved employee morale, productivity, and retention. Last but not least, proactive compliance saves time and money in the long run. A reactive approach to compliance requires significant resources to be allocated after the breach, such as investigations, audits, and legal fees, not to mention the potential fines a company may have to pay. Reducing the number of potential breaches proactively also takes significant burden off Legal and Risk & Compliance teams, enabling them to focus on strategic business objectives rather than constantly extinguishing fires.

So how can companies achieve proactive compliance on their electronic communications? With recent advances in Artificial Intelligence (AI), this objective has just become easier to achieve. Lexverify’s AI-powered assistant is a cutting-edge solution that helps organisations prevent legal and compliance risks on their electronic communications in real time and achieve proactive compliance at scale. Lexverify uses Machine Learning (ML) and Natural Language Processing (NLP) to identify potential risks as an email or instant message is being typed, providing real-time alerts and continuous development support to employees. This approach not only saves time and resources for the organisation, but also helps to promote a culture of compliance across the organisation.

Lexverify enables businesses to move away from ‘extinguishing fires’ within corporate communications towards preventing them in the first place. This means better and more professional and productive work environments, and fewer legal issues. It also means a more socially responsible business environment that is proactive in preventing risk as opposed to treating its consequences as the cost of doing business.

Proactive compliance is essential for organisations that want to stay ahead of the curve in today’s digital environment. Lexverify’s AI-powered assistant can help your organisation achieve proactive compliance at scale, saving you time and money, protecting your reputation, and providing continuous development support to your employees. Why not give it a try and see how Lexverify can benefit your company?

Want to participate in our private Beta? To find out more or book a demo, get in touch here.


bottom of page