Are compliance departments prepared for a technological future?
The future of many industries is becoming increasingly reliant on technology, as companies begin to automate more processes, digitise channels and provide customers with greater choice over their interactions and transactions.
This shift provides opportunities and challenges for corporate governance departments because while they now have access to more innovative tools to perform their jobs, this also opens the door to a greater number of threats.
Cybersecurity issues, legacy IT systems and new regulations are just some of the risks that the boards of companies must now combat to ensure the smooth operation of their business. The need for technological nous and skills at the senior executive level is now essential – but are compliance officers prepared for these responsibilities?
The need for better compliance
Two industries where digital innovation is having a particularly large impact on compliance departments are finance and, unsurprisingly, technology.
A recent Accenture study, citing Gartner figures, noted that financial services is the biggest spending industry on IT, with an estimated $360 billion (£270 billion) invested in 2016.
The same report acknowledged that there is a lack of technology skills on the boards of many financial services firms. However, the UK is one of the most tech-savvy countries in the world in this area, with more than 14 per cent of board members possessing professional technology experience – only the US had more at 15.7 per cent.
Meanwhile, a PwC article outlined the importance of compliance in the technology sector, which is expected to experience significant technological breakthroughs over the next ten years.
Compliance officers will therefore be expected to build resilient strategies that not only withstand the disruption that technology causes but also drive their business forward as innovators.
Preparing for the future
Organisations must begin addressing technology skills shortages within the boardroom and across their compliance departments. The Accenture study suggested personalised coaching programmes to enable professionals to better understand the business implications of technology developments.
Sadly, PwC’s 2015 State of Compliance survey showed only 33 per cent of enterprises believed their compliance functions had technological acumen. The same proportion said they had data analytics experience within their ranks.
“Building a more diverse team that includes business, sector, and technology skills and knowledge will signal that the compliance function is not just a legal watchdog but also a strategic partner focused on business outcomes, and that will help gain support from the C-suite,” the report read.
Research from NextAngles indicated that financial services businesses may also need to update their systems in order to facilitate compliance processes. In fact, 27 per cent of respondents claimed their organisations still primarily use spreadsheets, despite the availability of advanced artificial intelligence-based platforms for compliance functions.
Mallinath Sengupta, chief executive of NextAngles, said: “The survey shows increasing anxiety among financial institution executives that they are insufficiently staffed and equipped for today’s compliance challenges.”
Are your compliance teams ready?
There are many approaches businesses can take to attract and retain compliance officers with the right mix of skills to meet the technological needs of the future.
Businesses can offer competitive compensation and benefits, provide clear career paths towards senior positions and actively recruit people through undergraduate and graduate programmes.
Barclay Simpson found that 30 per cent of compliance professionals were looking for salary improvements when considering a job switch in 2016. Better career prospects were a key factor for 55 per cent of respondents.
However, according to PwC, nearly one-third of global organisations aren’t using any of these techniques in order to entice the best candidates to their business. Only 25 per cent are offering clear promotion, meaning many could be missing out when trying to appeal to the majority of professionals who are looking to move their career forward.
Are you looking to strengthen your compliance departments? Or are you looking to shake things up in your career and switch to a new role? Click here to discuss your needs with a consultant at Barclay Simpson.
Our 2016 Compensation and Market Trends Report combines our review of the prevailing conditions in the compliance recruitment market with the results of our latest employer survey.
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