New laws can be perceived as a burden. But what if we saw new legal requirements as a catalyst for innovation instead? With the new EU directives on sustainability and cybersecurity, companies can not only minimize risks but also strengthen their long-term competitiveness. By embracing new laws, you have the opportunity to create new business opportunities for the future. So writes David Wahlbeck, CPO at Stratsys.
Let me start with a confession: I hate new laws.
New laws are like little Pacman monsters, gobbling up everything in their path. They're cumbersome, demanding, moody and, as I said, they're resource-hungry. Some of them are not so small, by the way, such as the extensive directives coming from the EU.
I don't think I'm alone. Maybe you feel something similar. A justified frustration, because no matter how good the intentions behind new laws, what sane leader looks forward to a Christmas present that redirects organizational resources from value-creating efforts to, well, what?
Catalyst for innovation
But perhaps there is another side to the coin, one where laws are not just a headache but can contribute positively from a business perspective? Where they can create competitive advantage, strengthen the brand and drive growth?
Before you click away my text, give me a minute to explain.
Many companies implementing new legislation choose to comply with legal requirements on a superficial level. It easily becomes something that legal is tasked with managing. Which isn't surprising, given that we tend to see new legislation as cumbersome, time-consuming and costly. A necessary evil, even.
We often fail to use legislation as a catalyst for business development and innovation.
The approach is perfectly understandable, even reasonable. But the risk of seeing new legislation as a burden is that we miss the opportunity to use it as a catalyst for business development and innovation.
Sustainability also on the bottom line
One area where opportunities are emerging is in sustainability. The EU is imposing new and much tougher requirements in the form of the CSRD Directive, for example, which means that companies affected by the legislation will need to take it seriously. But what if your company doesn't just choose to meet the minimum requirements, but takes it a step further? What if sustainability legislation is integrated into the core of your business strategy?
By putting sustainability at the heart of both product development and marketing, initiatives such as CSRD offer the perfect opportunity to take a big step towards meeting customer demand for green solutions - a trend that will only grow stronger in the years to come.
By investing in sustainability, you can increase the value of what you offer.
By investing properly - and honestly - in sustainability, you have the opportunity to lay the foundations for increasing the value of what you offer. Put simply: charging a premium price for products that contribute to a sustainable society. It has the potential to create business value for you that goes far beyond the letter of the law.
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David Wahlbeck, CPO at Stratsys
Increased confidence, reduced risks
So far, I have emphasized the opportunity perspective. The fact is, however, that new legislation can also help by reducing risk. In the area of Governance, Risk and Compliance (GRC), the EU is currently rolling out new requirements. Legislation such as NIS2 and DORA both place high demands on organizations' ability to manage and protect sensitive information.
Instead of just ticking off checklists, what if we were to develop procedures and processes that can withstand the storm? What if we didn't just follow the law, but did our utmost to minimize the risk of cyberattacks, protect ourselves from damage and prevent costly disruptions?
Good risk management can build trust, foster relationships and open the door to new opportunities.
Again, I am convinced that you have a lot to gain by taking the longer view. Good risk management is not primarily a good idea to please the legislator. It allows you to strengthen trust with customers and partners, foster long-term relationships and open the door to new business opportunities.
Drop the millstone around your neck
Of course, tough laws are a burden, there's no getting away from that. By definition, it is not something you or I have chosen, but something that is imposed on us. But my firm view is that it is time to stop seeing new laws as a millstone around your neck.
See new legislation as a springboard to be better equipped for the future.
Precisely because legislation is an inescapable fact, it presents us with a choice. Do we choose to turn our backs on what is happening and do as little as we can? Or do we seize the opportunity to use the new legislation as a springboard to develop organizations and businesses, so that they are better equipped for the future?
Look at new laws in the same way as any other change - as an opportunity to adapt and shift gears. So my message to both of us is to embrace new legislation, even if we find it hard to love.
