The term ‘compliance’ might be a common buzzword in office spaces, but it’s a major part of daily operations for manufacturers.
Compliance in the manufacturing industry ensures adherence to the operational standards that allow businesses to operate and serve their customers. In the fast-paced manufacturing world, particularly in the COVID-19 era, staying updated on regulatory changes keeps things running.
In this blog, you will learn the intricacies of manufacturing compliance:
- Why it matters
- What you can do to keep your manufacturing business compliant in Virginia
What is Compliance in Manufacturing?
Compliance is a term that all businesses know all too well, but it means even more to manufacturers. Generally speaking, manufacturers need to pay attention to two types of compliance: regulatory compliance and corporate compliance.
Regulatory compliance is the adherence to state, federal, and international laws and regulations relevant to a business’s operations. The specific requirements can vary largely depending on the industry and business type. From a small manufacturer’s perspective in Virginia, regulatory compliance means following the rules and regulations given by the state and federal government and any relevant industry groups.
Read more about regulatory compliance in this VDACS Handbook For Small Food Manufacturers.
Corporate compliance, on the other hand, covers both internal policies and procedures, as well as federal and state laws. It’s about ensuring your company is lawfully operating within both the external and internal regulations set forth by the company itself.
Global organizations must comply with regulatory agencies in all countries where operations are taking place. What may be standard procedure in the U.S., for instance, may not be legal in manufacturing sites in other countries.
What Manufacturing Compliance Includes:
- Anti-corruption
- Data Protection
- Employment Law
- Export Controls
- Fair Competition
- Health, Safety, and Environment
- IT Safety and Security
- Product Safety
Why Manufacturing Compliance is so Important
According to this Report of the Joint Legislative Audit and Review Commission To the Governor and The General Assembly of Virginia, compliance ensures your manufacturing company operates safely and respectably, offering protection to all stakeholders.
Non-compliance Risks
- Business Risks: Compliance gaps can halt operations, disrupting routine business activities.
- Financial Risks: Breaches in compliance could lead to slowed production or canceled orders, causing financial strain.
- Legal Risks: Ignoring regulatory compliance guidelines could cause legal issues, escalating financial risks due to legal fees and possible fines.
- Reputational Risks: Breaching compliance can tarnish a company’s reputation, causing a loss of trust among stakeholders.
Compliance Benefits
- Safety and Quality: Compliance ensures a safe working environment for employees and quality products for customers.
- Improved Communication: A compliance program fosters communication about compliance concerns and regulatory changes.
- Enhanced Employee Performance: With a full understanding of operational guidelines, employees are better prepared to perform their jobs and potentially develop innovative solutions.
- Financial Savings: Compliance helps avoid legal fines and financial burdens arising from non-compliance.
- Stakeholder Trust: A compliant organization earns greater trust from all stakeholder groups, reinforcing a positive reputation and smooth operations.
What Are Virginia’s Manufacturing Regulations?
Federal Regulations Impacting Manufacturers
On the federal level, regulations touch on aspects from environmental responsibility, maintaining workplace safety standards under OSHA, to adhering to trade policies. Small manufacturers in Virginia must also comply with the Federal Trade Commission’s truth-in-advertising laws, which require honesty about their products and capabilities.
State Regulations Impacting Manufacturers
On the state level, Virginia’s Department of Labor and Industry plays a key role in regulating manufacturing operations. This includes rules related to employee safety, wage and hour restrictions, and the Virginia Occupational Safety and Health program. Additionally, manufacturers must adhere to environmental regulations overseen by the Virginia Department of Environmental Quality, which include waste management and air and water pollution controls.
Regulation Changes and Their Impact on Compliance
Changes in both federal and state regulations can often pose regulatory challenges for small manufacturers. These manufacturers must constantly monitor these changes and adjust their operations to maintain compliance. Non-compliance can lead to penalties and even jeopardize a firm’s operational license.
How Can My Manufacturing Business Stay Compliant?
- Stay updated. Monitor regulatory changes on both state and federal levels. This can involve subscribing to newsletters, attending industry meetings, or setting up Google alerts for new regulations.
- Implement a compliance program: Your compliance program should outline the responsibilities of each team member and the processes in place to ensure compliance. This involves creating a policy document that details the necessary steps to adhere to the regulations. Business Growth & Strategic Planning Services from GENEDGE offer unique strategic planning and implementation assistance.
- Train your employees: Ensure your staff knows the regulations affecting your operations. Regular training sessions help ensure that everyone is up-to-date. GENEDGE’s platform for online and in-person training sessions for staff to stay current with regulations and compliance requirements.
- Regular audits: Conduct internal audits to ensure your business complies with all the necessary regulations. The CONNEX Virginia tool can help you identify any supply chain gaps that must be addressed.
- Maintain documentation: Keep a record of all your compliance activities. This includes training records, policy updates, audit results, and any actions taken to address compliance issues.
For more information on how GENEDGE can help, contact us and get a free assessment today!
