The business’s compliance need is growing while its compliance budget is under pressure to shrink: This is the circumstance described by chief compliance officers surveyed for Accenture’s 2019 Compliance Risk Study. Seventy-one percent face cost reduction targets. Yet more than one in three (35 percent) say business growth is the most important driver of transformation in the compliance function. Talent concerns, such as higher-than-expected unmanaged employee attrition, add a third dimension to the challenge.
How can the compliance function lower costs, retain talent and keep pace with fast-changing demands?
These competing pressures suggest a cautious approach to risk and compliance management can no longer cut it. Compliance leaders should push to become agile business partners, able to identify new risks and guide the business through today’s state of permanent disruption.
The compliance risk study’s findings illustrate the challenge facing compliance officers. They need to revamp the function to fit a new business model, while facing cost cutting and resource pressures.
Seizing the compliance reins
To drive the compliance function forward, chief compliance officers may want to consider the following actions:
- Upset the pace: If traditional compliance approaches do not seem fit for the future, it’s up to the compliance leader to modernize the function’s thinking and remain relevant.
- Re-state the “first line of defense”: A re-scoped compliance model has the front office stepping up as the “first line of defense,” freeing the compliance team to focus on higher risk activities.
- Pivot and adopt the New: Facing quantifiable cost reduction targets, compliance should move quickly to execute its strategy via larger-scale transformation, tapping technologies such as Artificial Intelligence (AI), Robotic Process Automation (RPA) and Regulatory Technology (RegTech).
- Empower the next-gen compliance officer: Compliance leaders can build a dynamic, higher touch work environment that identifies risk and connectivity to bad actors earlier in business transactions.
- Accelerate to Compliance 2.0: Deploying a clear and inspiring strategy, leaders can deliver a Compliance 2.0 state that innovates at scale to empower a new generation of compliance officers.
Get the journey started
To tackle these steps—and start the journey toward Compliance 2.0—the function can begin by focusing on:
- Developing a next-gen compliance officer who is digitally fluent, analytical and proactive in cultivating relevant risk insights
- Defining new roles to support the re-shaped operating model, so the business can better manage risk and while keeping compliance’s “seat at the table”
- Incorporating new technology to identify risks and bad actors early in transactions—in an automated way
With compliance facing cost reduction targets, driving substantial change can be challenging. But it is essential for compliance to be decisive in its leadership, bold in its thinking and transform the function into one that is fit for the information age.