5 Must-Haves for Managing Outside Activities Before They Become Inside Problems
Side Gigs, Board Seats & Political Heat: Is Your Compliance Program Ready?
A recent study by the Society of Corporate Compliance and Ethics (SCCE) found that over 60% of compliance officers rank employee conflicts of interest as a top concern, yet only 40% of organizations have a formal process for tracking employee outside activities (OA). With regulators increasing scrutiny on undisclosed engagements—ranging from board memberships to freelance work—businesses must establish a clear, efficient framework to mitigate risk and ensure compliance.
Instilling a culture of compliance throughout the organization is crucial, ensuring that employees understand their responsibilities and proactively disclose outside activities to protect both themselves and the company.
Industry trends indicate that organizations are facing growing regulatory expectations around employee outside business activities. As firms expand globally, employees increasingly engage in extracurricular activities, side businesses, political activities, and external board roles. Employee compliance teams are under greater pressure to monitor and mitigate conflicts of interest, with leading organizations turning to automated compliance solutions to improve oversight and reduce risk exposure.
Five Essential Elements of an Effective Outside Business Activities Compliance Program
1. Customizable Declaration Forms for Seamless Compliance
A strong compliance program begins with a user-friendly declaration process. Employees should be able to declare outside activities effortlessly through tailored forms that capture only the necessary information. Configurable declaration forms allow compliance teams to collect specific data points while reducing friction for employees.
2. Automated Workflows for Reviews and Approvals
With many organizations still relying on manual oversight, automation is essential. Smart workflows ensure that outside activity declarations are automatically routed to the right compliance personnel based on risk level, employee role, or business unit. This reduces processing time, enhances accuracy, and ensures compliance consistency.
3. Integrated Certifications for Ongoing Compliance
Aligning outside business activity tracking with annual certification programs strengthens compliance efforts. Employees should periodically review and certify their outside activities, ensuring their records are up to date. Automated reminders and escalation protocols help organizations maintain continuous compliance with minimal administrative burden.
4. Identifying Conflicts Instantly with Centralized Data
A single source of truth for compliance—integrating outside activity data with gifts, personal trading, and other compliance areas—gives organizations a comprehensive view of potential conflicts. As industry best practices evolve, compliance teams are increasingly adopting centralized company datasets to quickly detect and resolve conflicts before they escalate and to ensure better coordination across compliance functions.
5. Data-Driven Insights for Smarter Decision-Making
Organizations that integrate compliance analytics into their risk management strategies are seeing improved efficiency and stronger oversight. Leading firms are prioritizing centralized reporting and real-time insights to proactively address risks and enhance transparency, ensuring compliance teams can quickly identify patterns and prevent potential regulatory violations.
The Path Forward: How StarCompliance Can Help
Regulatory expectations are evolving, making technology-driven compliance solutions essential. The StarCompliance (Star) suite provides a configurable platform that streamlines outside business activity declarations, automates workflows, integrates certifications, centralizes compliance data, and delivers powerful analytics. By leveraging Star, businesses can enhance oversight, minimize administrative burdens, and foster a culture of compliance and integrity.
Managing outside business activities shouldn’t be a compliance bottleneck—it should be a seamless component of corporate risk management. Automating workflows, centralizing data, and leveraging analytics enable companies to strengthen compliance while optimizing efficiency.
To learn more about how Star partners with firms to improve their overall employee compliance programs, schedule a personalized demo here.
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