Foods Connected Blog

Compliance management: what it is & why it's important

Written by Greer McNally | Dec 20, 2024 9:40:06 AM

We answer the big questions around compliance management in our latest back-to-basics industry guide. 

From food safety to labelling regulations and traceability, it can be difficult for businesses to keep up with the food industry’s ever-changing legal requirements. But having a strong compliance management approach in place can make sure your business can plan, organise, lead, and control the activities that ensure industry compliance. 

So, to understand the what, when and how of compliance management, let’s delve into the key considerations and challenges associated with it.

What are the main components of a compliance management system (CMS)? 

Compliance management seems complex, but the concept can be simplified by breaking it down into the following components:  

  1. Board & management oversight

A culture of compliance requires support and commitment at the highest level, so business owners and managers must do the following:  

  • Demonstrate that a no-compromise approach to compliance matters to them. This applies not only to operations and internal activities but also to their choice of suppliers.
  • Capture the company’s commitment to compliance in policy statements that guide decision-making.
  • Appoint and empower a compliance leader with the authority to align business activities with laws and regulations and allocate resources towards achieving compliance.
  • Perform annual compliance audits and revisit compliance whenever regulations are revised, or in the event of large-scale changes such as an organisational restructure. 
  1. Compliance programmes

Compliance programmes should include the policies, procedures, and standards that should be followed across all your business activities. A key part of this is designating particular individuals or departments for monitoring compliance, specifying reporting responsibilities and identifying any necessary improvements. 

Since each employee has a role to play in compliance, training forms part of the programme. For example, production line personnel must be trained on how to uphold food safety laws and where to escalate compliance-related concerns. Similarly, managers should also be trained to oversee compliance efforts and effectively identify and manage risks. 

Compliance officers and managers must have the necessary skills to develop policies and procedures that ensure laws and regulations are followed. They also need to understand why certain policies are required and how they affect routine work.

When new regulations come into effect, compliance managers must assess them and decide what actions or decisions are required. As part of this, they conduct supply chain audits to verify supplier compliance and initiate any necessary corrective actions. 

3. Compliance audits 

Internal compliance audits afford food businesses an opportunity to review activities and address risks. The higher the level of risk, the more frequently audits should be conducted. The nature of the products, the complexity of processing, and the number of affected consumers all impact risk. Audits should be scheduled at least once a year, and some businesses, for example, those who manufacture processed meat products, will perform them more frequently.  

Audits begin with an evaluation of policies and procedures and a review of records. These include training records and standard operational procedures and reports. Compliance standards and reports are carefully studied, and findings are recorded and reported to top management along with any recommendations for improvement. These are evaluated, and changes are implemented and followed up as needed.  

Why is compliance management so important in the food industry? 

Legal and regulatory compliance is crucial in any line of business but in the food industry, it's particularly critical to the health and safety of customers as well as brand reputation. Food safety and quality are basic requirements, and many of the laws food businesses must follow were passed to protect public health. For example, effective allergen management and guarding against contamination can save lives.  

While non-compliance in certain industries could result in little more than fines and penalties, it can have much more serious consequences in the food industry. Aside from avoiding the legal consequences of non-compliance, good compliance management fosters customer trust and protects your business’ reputation while reducing the risk of product recalls. 

What are the challenges in compliance management? 

Food businesses face an array of unique challenges when navigating regulatory compliance, but there are actionable solutions. In this section, we will consider compliance challenges before examining the practices that will help you to overcome them.  

A complex & continuously evolving legal environment  

Food manufacturers, retailers and service providers operate in a complex legal environment. The regulatory requirements for a single product can span several laws and sets of regulations. For example, if you are producing a meat-based product, it must comply with a multitude of regulations such as the Food Safety Act, the Animal Welfare Act and traceability and sustainability requirements. Packaging must also comply with a range of regulatory requirements, with examples relating to food composition and labelling to nutrition, health claims and food composition. 

Supply chain traceability & transparency 

Supply chain traceability and transparency are crucial for compliance. The classic farm-to-fork approach may sound straightforward, but industry professionals understand the intricacies of tracing multiple ingredients all the way back to their source. Often, ingredients change hands several times before they are processed, and at every step, compliance must be verified.  

Continuous vigilance 

With public health and business reputations at stake, vigilance is a continuous responsibility. Apart from monitoring supply chains, food businesses must oversee their own daily activities, keeping detailed and meticulous records to show they’ve met the necessary standards. At its best, this constant attention to regulatory compliance can prevent incidents that would otherwise lead to substandard or dangerous products reaching the market.  

Data management 

Compliance management depends on vast data sets, from supply chain information to laboratory analysis results and data collected during processing. Data must be gathered, analysed, interpreted and stored, and the data format as well as its security add to the challenges of compliance management. In addition, data must be shared as evidence of compliance, so while data should be secure, it should also be well-organised, accessible and transferrable.  

Best practice tips for improving compliance management in the food industry 

Demand planning

  • Stay current with developments in the regulatory environment. Since this task is a complex one, engaging experts to help you interpret and implement regulations may be helpful. 
  • Conduct regular internal inspections and third-party audits: Your internal compliance inspections should be a regular routine, but it’s possible to miss important details. Commission periodic third-party audits to achieve an objective assessment while also identifying potential skills gaps that can be remedied through compliance training. 
  • Implement effective supplier selection and management: Require suppliers to provide evidence that their products are safely and ethically produced. Traceability will be a key principle to follow. Collaborate with them so that they understand your compliance needs and can implement any improvements you require.   
  • Formulate a crisis management plan: No matter how committed you are to food safety and regulatory compliance, errors can creep in. Prepare your business for potential recalls so that they can be implemented quickly and efficiently.  
  • Leverage your data to drive continuous improvement: Your organisation will use its data to achieve and track compliance. Use it to find areas for improvement in which you can reduce risks. Track your performance by setting compliance KPIs for employees, departments, and your business as a whole and aim for continuous improvement.  

Compliance management solutions from Foods Connected 

Foods Connected helps you to manage compliance across your supply chain including real-time data for traceability, templates for risk assessments, food safety audits and data-driven performance tracking. We can also help you to monitor important internal activities like HACCP management and document control. Talk to us about your needs. We’ll help you select the compliance management tools you need to make compliance management simpler yet more effective than ever before.  

To find out more about our safety, quality and compliance software, request a demo today.