How to achieve better compliance with your company's contracting policy

Why Contract Compliance Matters in Business Operations

 In-house counsel design their contracting policies to better manage contract risks. One risk is employees signing contracts that have not been reviewed and approved by the right people. Another risk is that contracts are not properly stored and managed.

Creating a policy is an important first step, but making sure everyone is following it is what really matters. So who makes sure everyone is following these rules?

Legal could get involved in every transaction. But that approach is expensive, inefficient, and Legal ends up the scapegoat for slow processes.

In some companies, Supply Chain and Sales Ops manage this. But unless these teams are embedded in the business unit, they may not know everything that’s going on.

How to Improve Contracting Policy Compliance

My favorite solution?

Designate a contract compliance lead in each business unit.

Each department has one employee coordinate all of the department’s non-disclosure agreements and random contracting.

I found the best people for this role have a compliance mindset and report to a senior VP or director. I provide detailed training, so they know the requirements. Then this person would field all first-level questions from their team.

I saw much better compliance rates than relying on every person to understand and follow all the policies’ intricacies.

What's your favorite approach to improving contracting policy and procedure compliance?