The Importance of Third party Compliance Audits in the cannabis industry
The cannabis industry has grown significantly in recent years, with many states legalizing cannabis for medical and/or recreational use. As the industry continues to expand, it is important for licensed cannabis businesses to ensure that they are in compliance with all relevant regulations and standards. One way to do this is through third-party cannabis compliance audits.
Third-party cannabis compliance audits are conducted by independent companies, like Konopé Compliance, which specializes in assessing compliance with state regulations and established standards in the cannabis industry. It’s important to vet the consulting firm performing the audit to ensure they are qualified to identify non-compliant issues as well as correct and prevent any non-compliant issues from becoming a larger issue down the road. The consulting firm should come with recommendations from previous clients, case studies, and cannabis industry experience! They should have practiced what they preached first.
At Konopé Compliance, we set ourselves apart from other consulting companies by providing practical and theoretical experience in the cannabis industry. For the past 14 years, we’ve lived the execution. The ultimate goal is for our clients to have peace of mind that they can continue operations without worrying about the risk of a recall or adverse health event, and their staff is prepared for an inspection OR investigation.
Compliance audits are important for licensed cannabis businesses for a number of reasons.
First, third-party audits provide an objective assessment of a company's compliance with regulations and standards. This is important because it can be difficult for companies to assess their own compliance objectively. By using an independent third-party, companies can ensure that the assessment is unbiased and that any areas of non-compliance are identified and addressed. Think of us as your compliance person’s favorite compliance person.
Second, third-party audits can help licensed cannabis businesses to identify and mitigate risks associated with non-compliance. These risks include potential legal and financial penalties, damage to the company's reputation, and loss of business. By identifying these risks early, companies can take steps to mitigate them and avoid potentially costly consequences. Nothing hurts the bottom line more than unnecessary fines.
Third, third-party audits can help licensed cannabis businesses to improve their operations and practices. Compliance audits often include recommendations for how to address areas of non-compliance, and these recommendations can help companies to improve their operations and practices, reduce costs, and improve the quality and safety of their products.
Fourth, third-party audits can help licensed cannabis businesses to build trust with stakeholders. By demonstrating a commitment to compliance with regulations and standards, companies can build trust with regulators, investors, and customers. This can help to attract investment, support, and repeat business.
Fifth, third-party audits can help licensed cannabis businesses stay up-to-date with evolving regulations and standards. The cannabis industry is evolving rapidly, with new regulations and standards being introduced regularly. Compliance audits can help companies to stay up-to-date with these changes and ensure that they are in compliance with the latest regulations and standards.
Finally, third-party audits can help licensed cannabis businesses to promote sustainability in the industry. By ensuring compliance with regulations and standards regarding sustainable business practices and responsible production and cultivation techniques, compliance audits can help to reduce the environmental impact of the industry and promote a more sustainable future. This can include odor control plans which can decrease the amount of volatile organic compounds released into the environment, social impact and community engagement plans, or assisting companies in finding alternative solutions for packaging and labeling their products.
At the end of the day, third-party cannabis compliance audits are important for licensed cannabis businesses for a number of reasons. They provide an objective assessment of compliance, help to identify and mitigate risks associated with non-compliance, improve operations and practices, build trust with stakeholders, keep companies up-to-date with evolving regulations and standards, and promote sustainability in the industry. By prioritizing compliance and taking steps to address any areas of non-compliance, licensed cannabis businesses can position themselves for success in this rapidly growing and dynamic industry.