Service Standard Compliance – Following the Royal Commission’s scathing 2019 report into the banking and financial services sector, there has been a renewed focus on compliance. A pulse-check in our latest experteq Compliance Index – now in its fourth edition – shows that compliance management, regulation and risk, continue to be top of mind for business leaders.
Research and analysis for the experteq Compliance Index was conducted by Manning & Co. and drawn from responses gathered through a targeted online survey and a series of interviews. The responses were collected from a diverse range of C-suite and senior managers employed across banking, finance, insurance, superannuation and IT/tech. The Index explores the barriers to effective compliance management, the increasing complexity in regulatory standards and the steps leaders must take over the next 12 months to meet evolving expectations.
More so than in previous years, leaders and their organisations are concerned about the threat posed by a lack of effective compliance management to business operations. This is particularly the case in the current pandemic-affected business environment. While the COVID-19 situation presently consumes businesses, the challenges of compliance and security are here to stay and must continue to be dealt with appropriately.
Compliance management feeds into multiple processes across all areas of business. As the experteq Compliance Index finds, leaders are feeling the pressure on several fronts. And there is still a long way to go before the industry practices compliance management at a best practice standard.
According to the leaders and professionals we interviewed for our latest Compliance Index, the most pressing challenges leader’s face is changing regulations standards and cybersecurity. And according to experteq CEO, Shane Baker, “As we enter a new decade, risk and compliance are centre stage, yet there is still work to do in moving the conversation forward.”
While it can be tempting to be distracted by the evolving COVID-19 situation, compliance issues remain a top priority and leaders must remain vigilant. In fact, in times of increased financial uncertainty when there are internal pressures to manage business continuity, the probability of risk-taking rises. Any unwanted risks now can lead to lasting negative consequences.
Leaders at all levels must continue to develop robust risk-mitigation plans. Managing compliance and security during and after the crisis is essential to business continuity. Here are five of the most significant barriers to achieving optimal service standard compliance:
Resource constraints. Leaders are grappling with servicing increased communication channels, changing customer needs and a subsequent rise in the cost of dealing with compliance across these multiple avenues.
Time management. Truly effective compliance means an overhaul of current systems, addressing gaps in existing protocols and identifying where shifts need to happen. This requires investing in the right tools and training, all of which take time.
A skill gap internally. Organisations who haven’t invested in the right training are starting to find that outside of the primary compliance officer, the skill of managing compliance is lacking, leaving the workforce ill-equipped for new standards.
A siloed view of management. Compliance should be the responsibility of every single person in the organisation, not just the compliance officers, and leaders have to create compliance-first cultures that encourage this thinking.
Underappreciated value. Compliance has historically seen as a chore where it is an opportunity. It’s critical to effective business operations and managing customer expectations, especially post the Royal Commission.
Despite organisations recognising the risks associated with data breaches and failing to meet regulatory standards, there is as still a way to go in the quest for best practice compliance management. A vital part of this will be a shift in mindset, from viewing compliance as a tick boxing exercise to a business imperative and a critical opportunity for leaders to leverage in building a competitive edge.
Don’t risk being left behind. Learn more in the fourth edition of the experteq Compliance Index here.