Why compliance alone is no longer enough. In an increasingly regulated and digitalised world, compliance has become indispensable for any reputable company. Only those who act in accordance with the rules can minimise risks and protect the company.. The significance of compliance has undergone a fundamental shift in recent years. Whilst it was previously understood exclusively as a tool for prevention, it has increasingly come under the spotlight in legal disputes and regulatory investigations. Failure to be prepared for this can result in irreversible damage to a company.. The growing number of regulatory and internal investigations, as well as legal actions in the context of compliance, has many causes:. Regulatory requirements that provide for sanction mechanisms are constantly increasing. The General Data Protection Regulation (GDPR) was arguably the best-known pioneer in this regard. Meanwhile, the following are also playing a greater role at European level: the Data Act, the Cyber Resilience Act (CRA), the Data Governance Act (DGA), the AI Act, the EU Whistleblower Directive and the EU Pay Transparency Directive.. At the same time, supervisory and investigative authorities have been structurally strengthened, enabling violations to be prosecuted more efficiently (including the Cum-Ex scandal).. Private enforcement is also gaining in importance. Class actions (e.g. the diesel emissions scandal) or strategically deployed lawsuits by competitors (so-called weaponised litigation) have long been established and entail significant economic and reputational risks.. Added to this are internal corporate conflicts such as proceedings for directors’ and officers’ liability, labour law disputes or internal investigations.. Sometimes companies also create their own vulnerabilities by, for example, promoting ambitious ESG (Environmental, Social, Governance) targets for publicity purposes, but simply failing (or being unable) to implement them. Such behaviour not only carries risks under competition law, but can also give rise to claims for damages or even have criminal consequences – for instance, in connection with so-called greenwashing.. For companies, therefore, compliance is only as valuable as the ability to not only claim, but also prove, that they have acted in accordance with the rules when it really matters.. What is litigation readiness?. In relation to the compliance challenges discussed, litigation readiness describes the ability to respond swiftly and in a manner that preserves evidence in the event of a dispute.. This encompasses the entire process, from strategic planning and securing evidence, through out-of-court negotiations, to the judicial defence against claims. The aim is to protect one’s own company in civil, administrative or arbitration proceedings.. But how can litigation readiness be effectively embedded within a company?. Implementing litigation readiness within the company. The question of what constitutes effective preparation must be answered individually for each company and requires a structured analysis. Litigation readiness encompasses not only legal measures but also technical and organisational measures that enable companies to act swiftly and in a legally compliant manner.. In our experience, the key elements of litigation readiness in any organisation include at least:
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