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Navigating global finance regulations to enable continuous compliance

Navigating global finance regulations to enable continuous compliance

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Across the globe, there are numerous regulations in place which are designed to safeguard both businesses and end users. But these regulations are not without their challenges, as organisations need to ensure continuous compliance.

The International Compliance Association (ICA) is one organisation which is helping businesses to manage these challenges by increasing the knowledge and skills of regulatory and financial crime compliance professionals across the globe.

Intelligent spoke to Pekka Dare, VP of ICA, to find out more about the organisation.

Pekka Dare, VP of ICA

Can you tell us about the ICA and its key objectives?

The International Compliance Association (ICA) is the leading professional body for the global regulatory and financial crime compliance community. ICA’s mission is to inspire and enable this community to conduct the right business in the right way though enhancing knowledge, skills and behaviour. Working with regulated sectors including financial services, energy, betting and gaming and telecoms as well as regulators and regional bodies, ICA is committed to helping raise standards of conduct and integrity through education.

Since 2001, ICA has trained over 160,000 professionals either through its internationally recognised portfolio of professional qualifications (awarded in association with Alliance Manchester Business School, the University of Manchester) or through in-company training. ICA has more than 17,000 members in over 150 countries.

What are some of the key challenges that organisations [in different regions] are grappling with right now when it comes to compliance?

The challenges facing the compliance community are wide-reaching and the pandemic has certainly created additional pressures and risks that impact compliance professionals. The recent Pandora Papers scandal has meant that money laundering is firmly in the spotlight and making sure organisations continue to have the right processes in place to assess, document and manage financial crime risk is essential.

According to the Annual AML Industry Benchmark Report 2021 from Arctic Intelligence, one in four risk and compliance professionals say that rolling out and managing the risk assessment process is a challenge, while 53% confirmed that they conduct risk assessments just once a year, with 68% advising that the process takes up to six months to complete.  

Digital Transformation, the increasing use of Artificial Intelligence to support due diligence processes and training – for all staff, not just compliance heads – all remain high on the corporate agenda to ensure staff are fully equipped with the skills and technology to help question, assess, identify, escalate and manage associated risks – whether that’s related to money laundering, sanctions, through to cyber, fraud risk or people trafficking.

The emergence of Environmental Social Governance (ESG) has raised the profile of the need for excellent GRC standards, as business operations impact on – for example – climate considerations (Environment) labour and societal impacts (Social) and the consequent imperative to manage, control and target business activities in a sustainable direction (Governance). ESG also focuses on combatting the risks of financial crimes within any organisation, such as bribery and corruption, so being able to understand and coordinate ESG standards and requirements is increasingly critical.

How do you help organisations address these key challenges?

ICA is committed to increasing the knowledge and skills of regulatory and financial crime compliance professionals across the globe. We therefore work across a variety of sectors including financial services, oil and gas, telecoms and betting and gaming to provide continuous learning, qualifications, resources, events and access to insightful information. The key, as we see it, is to demonstrate the tangible benefits of investing in staff as part of an integral approach to combatting the increasing range of risks they face.

We provide knowledge, guidance, information and practical skills as part of an ongoing strategy to constantly improve business performance and, to do this we seek global partnerships and alliances with regulators, firms and local compliance associations. Fundamentally, we aim to help individuals and firms continuously improve to face the challenges, both now and in the future.

What best practice advice would you offer organisations keen to improve their strategies for managing compliance?

Five key pieces of advice:

  1. Obtaining business buy-in is vital – compliance must be an ongoing consideration of those in the boardroom and filtered throughout the entire organisation. It’s a challenge, but one that can be overcome by engaging directly with teams and individuals, by being open and honest, and by working and communicating in a collaborative way. 
  2. Automation and technology are of great utility – but don’t overlook the ‘human’ aspect. Getting out there and conveying to teams the importance of regulatory updates remains a key part of compliance professional’s core duties.
  3. Giving the reason ‘why’ helps colleagues get on board. More is achieved by giving context to compliance updates and information, helping staff relate it to their everyday responsibilities. 
  4. Think creatively and acknowledge the role of others. Showing that you understand the often heavy duties placed on certain areas demonstrates empathy and helps foster positive, reciprocal relationships.  
  5. Share your successes and concerns. Giving voice to issues is the first step towards getting them resolved, whilst illustrating to others effective compliance helps other areas obtain a better picture of what it is compliance does.

Technology also has an important role to play in aiding compliance with regulations, particularly for financial services firms.

Douglas Greenwell, Head of Commercial Strategy, Duco

Douglas Greenwell, Head of Commercial Strategy, Duco, tells us more…

Financial services firms are struggling to meet reporting requirements required for regulations due to their legacy systems and manual data management processes. To better navigate global regulations, financial services organisations need to replace these outdated data processes. 

Data is the key to managing organisational compliance and reporting against regulatory standards. One error in a data set could lead to inaccurate reporting, resulting in regulatory fines and reputational damage. Being handled by humans, manual processes bring a huge element of risk through our tendency to make mistakes.

Manual tasks can become tedious, and humans can tire, leading to errors. A computer, on the other hand, won’t become bored and performs consistently. Consistency is crucial when dealing with large datasets and compliance. 

In embracing intelligent data automation (IDA), organisations can remove the element of human error. Financial services organisations must move away from ineffective legacy systems and processes that produce undependable data which fails to meet regulatory standards.

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