Two-Thirds of companies say compliance is key barrier to growth according to new study from Fyllo and Harris Poll
Cannabis Among the Most Impacted Industries; Challenged by Patchwork Legislation and Outdated Technology
A new study by The Harris Poll and Fyllo, the leader in digital marketing and compliance solutions for cannabis and other highly regulated industries, reveals that nearly two-thirds (63%) of companies see compliance issues as a critical barrier to growth.
The study titled, “Leading With Compliance: The Key To Growth In Highly Regulated Industries“, which surveyed 305 compliance leaders at companies in highly regulated industries including cannabis, healthcare, financial services, alcohol and pharmaceuticals, revealed surprising commonalities: all struggle with a complex web of federal and local legislation and an outdated compliance approach that impedes growth.
Despite the fact that more than three-quarters (82%) of companies in highly regulated industries currently accept that compliance is a cost of doing business, over the past five years, these companies have been cited on average 12.6 times for noncompliance. This results in extensive operational, reputational, and financial risks. Moreover, the majority of compliance leaders admit that they are often uncertain as to whether or not that the organization is compliant due the dynamic nature of the regulatory environment.
When asked if their company could adapt quickly to sudden changes in its regulatory or compliance environment, 61% did not believe their company could, with 28% pointing to outdated technology as the cause.
“In the face of fast-paced regulatory demands, outdated processes can’t keep up and that derails growth.” said Chad Bronstein, CEO and founder of Fyllo. “This survey revealed that companies want to utilize technology to understand regulatory updates, whether new laws or even just local legislative conversations.”
The study revealed hidden impacts of compliance problems:
Higher Costs: Nearly 50% said non-compliance results in higher costs to attract new investors and win new customers.
Diminished Growth: The vast majority (82%) report that adhering to regulations saps resources that would otherwise drive expansion into new markets (43%), new products/services (43%) , and innovation (38%).
Lost Revenue: 25% said problems led to a loss of customers; 20% said it led to employee turnover.
Damaged Trust: 73% of companies say compliance issues damage trust among consumers, regulators, and employees.
Interestingly, while Pharmaceutical and Financial Services were cited as the gold standards for compliance models, more than a quarter of companies in highly regulated markets said they look to the cannabis industry as a model for compliance best practices.
Commenting on this finding, Bronstein said, “Cannabis professionals are operating in a regulatory environment that changes daily across federal, state and local levels. As such, cannabis businesses have been quick to embrace tech solutions that streamline compliance processes to free up resources for growth, with the industry becoming the benchmark for effective management of compliance processes at scale.”
A full copy of The Harris Poll/Fyllo study can be downloaded here.
About Fyllo:
The Fyllo Compliance Cloud is a suite of software and services built to overcome the complexities of highly regulated industries. We deliver data, media, retail and regulatory solutions that enable organizations to streamline compliance, increase efficiencies, and scale with speed. Mainstream brands also seek out Fyllo’s Data Marketplace to target previously inaccessible cannabis and CBD consumers.
About The Harris Poll:
The Harris Poll is one of the longest-running surveys in the U.S., tracking public opinion, motivations and social sentiment since 1963. It is now part of Harris Insights & Analytics, a global consulting and market research firm that strives to reveal the authentic values of modern society to inspire leaders to create a better tomorrow. We work with clients in three primary areas; building twenty-first century corporate reputation, crafting brand strategy and performance tracking, and earning organic media through public relations research. Our mission is to provide insights and advisory to help leaders make the best decisions possible.