Adopting digital capabilities to transform operations and processes holds immense promise for utilities. Indeed, it’s the best path to growth.
Waking Up To Compliance Risk
Do you know what your legal exposure is?
be ineffective tomorrow because of changing circumstances. If control weaknesses are detected, the timetable for corrective action should be governed by the risk ratings (discussed above).
CRM enables an organization to better anticipate compliance problems, thereby avoiding surprises, through a better understanding of how compliance risks evolve. In addition, CRM improves the decision-making process by providing more information on compliance risks and mitigating strategies, thereby assisting managers in better understanding risk/reward tradeoffs.
Before the enactment of EPACT, FERC brought some significant enforcement actions and suggested that its penalties would have been tougher had it the authority to impose them. Now that FERC has that expanded penalty authority, we can expect that FERC will use it. The stakes are higher now. That is why the need for CRM is so much more compelling. CRM enables energy companies to self-police their conduct by identifying, assessing, and correcting compliance problems before they are discovered by regulators. Moreover, given the recent damage to the franchise value of several major corporations, having an early warning process in place capable of detecting compliance threats is a sound and essential risk-management tool.