How spend orchestration prepares you for SOX compliance

For publicly traded companies or firms with IPO aspirations, the Sarbanes-Oxley Act (SOX) is an essential regulatory hurdle to clear. Typically seen as a legal checkpoint on the road to going public, SOX compliance is often viewed through a narrow lens.

However, limiting this perspective to a mere regulatory exercise is missing the forest for the trees. SOX compliance is not just a regulatory checkbox; it's about laying the groundwork for a robust, transparent, and efficient accounting and procurement process that safeguards against fraud and enhances operational integrity across the business.

Procurement Orchestration offers a holistic approach to SOX compliance, evolving it from a statutory obligation to a pathway towards seamless and comprehensive reporting.

Let’s take a look at how a procurement orchestration strategy can turn optimizing compliance for SOX into a holistic strategic advantage for your company.

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Where SOX overlaps with procurement

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SOX was enacted in 2002 in response to high-profile scandals like Enron, aimed at preventing fraudulent practices by increasing transparency in financial reporting and establishing a system of internal checks and balances. 

Compliance is indeed a legal mandate, but it also serves as a framework for smarter business practices—protecting data, limiting access to financial systems, and reducing risks of insider threats and cyberattacks.

Because of this broad scope, SOX compliance is just one piece of the broader puzzle that enterprise and enterprise-level companies are faced with solving.

The ultimate goal for a company is not just to comply but to thrive, ensuring full visibility into the entire scope procurement activity, eliminating room for fraudulent behavior. 

This is why the concept of Procurement Orchestration is so important. A fully-orchestrated platform offers a streamlined approach to procurement from beginning to end, allowing for a level of transparency and top-level control that goes well beyond the scope of SOX.

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Procurement Orchestration for SOX and beyond

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When we first approached the challenge of creating a 'single front door' solution for intake requests at Zip, we knew there was a larger opportunity to build a holistic, integrated overview of the entire procurement process.

A user-friendly, consumer-grade experience starting at Intake ensures that the procurement process is easy to initiate by any employee—greatly increasing adoption across an organization—and at every step, every action by each and every stakeholder is logged with full transparency.

This level of cross-department Procurement Orchestration ensures not only compliance with SOX, but fosters a corporate environment where fraudulent activities are significantly hindered. Every procurement-related duty and task is visible to all stakeholders, from initial requests, approvals, sourcing and vendor management, through to payment.

This kind of early-capture visibility radically diminishes the possibility to engage in unethical practices, such as working with vendors who engage in bribery or collusion—the kind that SOX was specifically designed to combat.

For a procurement orchestration system to ensure integrity holistically, it needs to integrate seamlessly with Third-Party Risk Management (TPRM) tools. This is a key integration that allows for rigorous vetting of vendors for anti-bribery and corruption, ensuring that all vendors align with a company's ethical standards and legal requirements. 

A comprehensive and fully-integrated platform environment ensures that legal, security, IT, and other stakeholder approvals are seamlessly orchestrated and working in parallel, making for a robust platform that solves for managing procurement for SOX compliance and beyond.

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Automating audits for the Enterprise

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We’re fortunate at Zip to have a team comprised of procurement experts who have lived experience at every stage of scale. We know different levels of organizations have different needs. 

This is why we’ve prioritized intelligent automation features specifically designed to facilitate the auditing needs of companies at every stage of growth, whether they’re on the way towards, or already beyond-IPO. 

For this, and so many more reasons, we’re believers in the power of procurement orchestration to unify and prepare companies what’s needed now, and what’s coming next.

The ability to capture all processes end-to-end allows for the detailed tracking of user and permission groups, and provides simple and advanced audit trail exports. By streamlining the audit process, a company demonstrably affirms a commitment to transparency and accountability for independent auditors.

We have lots of experience here. At Zip, we understand that if you're mired in manual processes for audit preparation, you have far less time to focus on the core goals of procurement: saving money, sourcing the best partners, focusing on broader initiatives with regards to ESG, DEI, and other long-term strategic goals.

While many platforms have offerings for SOX, our vision of Procurement Orchestration goes further by ensuring that all procurement processes are channeled through the system, from intake to pay. This not only guarantees compliance, but offers a holistic view of all procurement activities, enabling better decision-making and control throughout a company's lifecycle from pre-IPO to post-IPO maturity.

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Zip: Accelerating business innovation at every stage of scale

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Our mission at Zip is to increase the pace of innovation for every business in the world.

This doesn't stop at SOX. By offering the fastest way to facilitate business purchasing, by providing insights to help make more confident spending decisions while also simplifying transactions, our goal is to empower companies to easily navigate the complexities of procurement and compliance. To ensure not only adherence to SOX, but also to guide and conquer every challenge that follows.

Managing the requirements of the Sarbanes-Oxley Act is mandatory for companies aiming for IPO. It's a step towards more integrated, transparent, and efficient processes. 

Procurement Orchestration is the strategic approach that not only ensures this compliance, but also sets the stage for sustainable growth and innovation. 

At Zip, we don't just consider ourselves a tool for compliance, but a partner in redefining procurement for modern companies, helping to accelerate business innovation worldwide.

‍See for yourself how Zip can drive your procurement function forward.