A penalty is OK (8)
I believe the answer is:
sanction
This clue is a double definition.
'a penalty' is the first definition.
(thesaurus)
'ok' is the second definition.
('sanction' can be a synonym of 'ok')
'is' acts as a link.
(Other definitions for sanction that I've seen before include "Allow; penalty" , "Penalty for breaking law" , "Go-ahead" , "Threatened penalty; official permission" , "Permit - punishment for breach of treaty" .)