New research from Accenture confirms that compliance risk management in the banking and capital markets sectors has grown in size and stature in the wake of recent industry events. The key concern now is whether such growing importance has achieved the required shift in behaviors and whether compliance programs can sustain the investment required to maintain their seat at the table and become a true strategic business partner.Accenture’s 2014 Compliance Risk Study – based on surveys with compliance officers at 100 banking and capital markets firms across Europe and North America – indicates that compliance risk management is at a critical juncture in its evolution toward a control function that is relevant and can establish long term stature and respect within financial service organizations. Five key themes emerged from our study, including
1. The size and shape of compliance programs continue to evolve.
Compliance has made significant progress in increasing its stature and role within the organization. A majority of compliance programs now report directly to the Board or the Chief Executive Officer (CEO), but there remain challenges in driving influence as strategy and processes are still relatively immature.
2. Further investment in compliance is needed to achieve strategic goals.
Investment in compliance shows no sign of slowing, with firms in Europe and North America both viewing analytics and risk modeling as a focus for current investment to help predict and mitigate future compliance events.
3. The competition for talent has become a barrier to success.
Securing sufficient compliance talent will be key to addressing sources of financial and reputational damage to an organization. Firms need to re-think identification, recruitment and, especially, retention of talent in a fiercely competitive market environment.
4. With a “perfect storm” brewing in compliance, firms need to demonstrate effectiveness and think beyond traditional solutions.
As they confront both a growing need to invest and a scarcity of talent, firms need to re-think their growth plan so they can help ensure long term sustainability, help maximize human capital and demonstrate their success.
5. The horizon is continually moving, and compliance programs are already setting priorities for the future of their compliance function.
Proactive, strategic planning by compliance programs will be critical to building and maintaining competitive advantage. In addition, programs need to adopt a global mindset that reflects local priorities as they plan for the skills and technology required to sustain their development.