Workplace Compliance

5 Ways To Transform Compliance Into Competitive Advantage

Wraps up in 5 Minutes

Author: Gavin Altus

Published On December 4, 2023

Quick Answer

What does compliance as a competitive advantage mean? It means using strong compliance to win and keep business, not just to avoid penalties. Australian buyers increasingly check suppliers: larger employers bidding for Australian Government contracts of $80,000 or more need a Workplace Gender Equality Agency letter of compliance, and entities with $100 million or more in revenue report on modern slavery risks in their supply chains. The right culture, incentives, technology, training and communication turn that into an edge.

In this guide

Compliance as a Competitive Advantage in Australia
5 Ways to Turn Compliance Into a Competitive Advantage
The Takeaway
Frequently Asked Questions

The costs of non-compliance are well known: penalties, reputational damage and lost revenue. What gets less attention is the upside. Treated well, compliance can help a business win tenders, keep customers and run more efficiently than its competitors.

This guide explains why compliance as a competitive advantage matters in Australia, and five practical ways to make it work for you.

Compliance as a Competitive Advantage in Australia

A 2017 study by the Ponemon Institute and Globalscape found that non-compliance cost organisations an average of 2.71 times as much as meeting compliance requirements, once business disruption, lost productivity, fines and settlements were counted (US$14.82 million compared with US$5.47 million a year).

In Australia, compliance also opens doors:

Government tenders: non-public sector employers with 100 or more employees must provide a Workplace Gender Equality Agency letter of compliance to supply goods or services to the Australian Government at or above $80,000.
Supply chain due diligence: entities with consolidated revenue of $100 million or more must report each year on modern slavery risks in their operations and supply chains under the Modern Slavery Act 2018, so their suppliers are often asked how they manage those risks. Our guide to the types of modern slavery explains what buyers look for.
Recognised standards: ISO 37301:2021 sets out requirements for a compliance management system, giving buyers and boards a common benchmark to check against.

5 Ways to Turn Compliance Into a Competitive Advantage

1. Foster the Right Culture

Culture change starts with the board and senior leaders. If they treat compliance as a box-ticking exercise, employees will see it as a hindrance rather than an advantage.

Leaders can change this by talking about compliance as part of how the business wins work, backing it with clear policies and procedures, and involving every level of the organisation. A culture that values compliance pays off over time.

2. Offer the Right Incentives

Employees tend to focus on their own tasks and targets, so compliance can slip down the list.

One way to change that is to recognise good compliance behaviour. Set measurable compliance goals, such as completing training on time or reporting hazards early, and reward the people and teams who meet them.

3. Use Technology

Technology has changed how businesses manage compliance. Automation through compliance management software is used by organisations around the world to cut manual effort, time and cost, keep records in one place and make it easier to show customers and regulators what has been done.

4. Deliver Compliance Training

Compliance training gives employees the ongoing support and resources they need to meet your standards. It carries leadership’s message about why compliance matters and makes clear what is expected of everyone.

Compliance training also lines up employee effort with the business’s compliance goals, which lowers the risk of breaches.

5. Communicate Your Compliance Clearly

Strong compliance makes little difference to your market position if nobody knows about it. Tell customers, partners and tender panels about the standards you meet through emails, newsletters, capability statements, tender responses and news releases.

Back every claim with evidence, such as certificates, policies and training records, and avoid overstating what you have achieved.

The Takeaway

Well-designed compliance management software helps you automate routine work and rise above the competition. Sentrient’s compliance management system automates compliance management tasks so leaders have more time for decision-making and strategic planning.

Frequently Asked Questions

1. Can compliance really be a competitive advantage?

Yes. Beyond avoiding penalties, a strong compliance record can help you qualify for government and corporate tenders, pass supplier due diligence and build trust with customers. The Ponemon Institute and Globalscape study found non-compliance cost 2.71 times as much as compliance.

2. How do small businesses benefit from compliance?

Small businesses often supply larger organisations that must report on modern slavery or meet procurement rules. Being able to show policies, training records and WHS processes quickly can make you an easier supplier to choose.

3. Which standard covers compliance management systems?

ISO 37301:2021, Compliance management systems: Requirements with guidance for use. It replaced ISO 19600 and can be used to design, assess and improve a compliance programme.

4. How do you measure whether compliance is giving you an edge?

Track tender wins where compliance was assessed, the time it takes to answer supplier questionnaires, training completion, incidents and audit findings. Improvements in these show compliance is supporting growth rather than slowing it.